Employee Management and AI

Digital transformation and the rise of modern technologies are fundamentally reshaping the workplace. Artificial intelligence, process automation, and digital tools are no longer just supportive means; they have become integral to how companies recruit, evaluate, and manage employees. While these innovations bring clear operational benefits, they also introduce new legal and compliance challenges that managers and HR professionals must address.

AI Act and Employee Protection

The European Union has adopted the Artificial Intelligence Act (AI Act), which sets strict rules for the use of AI in employment-related processes. Employers who rely on AI for recruitment, performance evaluation, or monitoring will face new obligations to ensure that AI use is:

• Transparent and understandable – employees must know when AI is used and for what purpose,

• Subject to human oversight – decisions affecting employees cannot be fully automated without human review,

• Fair and safe – systems must be designed to avoid discrimination, biased outcomes, or misuse.

For companies, this means reviewing how AI systems are implemented and ensuring clear internal policies that guarantee compliance with the upcoming regulation.

GDPR: Data Protection in the Digital Workplace

In addition to the AI Act, GDPR continues to play a crucial role in defining how employers may collect and process employee data. With the growing use of digital tools, the following points are particularly important:

• during recruitment, candidates must be clearly informed about how their data will be used,

• in performance evaluation and monitoring, data processing must be proportionate, relevant, and transparent,

• automated decisions cannot be the sole basis for hiring or employee assessment.

Employers must therefore ensure that all AI and digital systems are set up in a way that fully respects employees’ privacy rights. 

Labor Law and the Digital Reality

Rules on home office and employee monitoring are not new; they have long been addressed under labor law. What changes in the digital era is the way these rules are applied in practice.

Modern tools now allow much more detailed oversight of employees’ work, which raises both opportunities and risks. Employers need to:

• clearly define rules for remote work and employee availability,

• ensure that monitoring practices remain proportionate and transparent,

• take responsibility for cybersecurity, as the protection of sensitive employee and company data is a legal obligation as well as a business necessity.

When Will the New Obligations Apply?

• The AI Act will become effective 20 days after publication in the EU Official Journal, but obligations for companies will only apply after a transition period (typically 1–2 years, depending on the type of AI system).

• GDPR has been fully binding since 2018, and all data processing – including through AI tools – must already comply.

• Labor law obligations apply immediately, and digitalization only increases the importance of their proper implementation. 

What Employers Should Do Now

• Review your company’s use of AI and digital tools.

• Establish internal policies that ensure fair and transparent use of these technologies.

• Prioritize cybersecurity and safeguard employee data.

• Prepare early for AI Act obligations and stay up to date with legal developments. 

Conclusion

AI and digital technologies are transforming how companies manage their workforce. They bring efficiency and new opportunities, but also new legal responsibilities. By setting clear rules and processes now, employers can embrace innovation while ensuring compliance, employee trust, and legal certainty.

By Mgr. Dagmar Junková

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