GLOBAL PAYROLL MAGAZINE
23
“AI platforms have shown tendencies to produce inaccurate information or even ‘hallucinate’; meaning information is made up based on existing data. Errors have the potential to create
significant consequences for employers.”
What considerations must be made while using AI? While the above demonstrates that AI has the potential to significantly transform the payroll industry, risks that may arise from using AI must be considered. The risk of inaccuracy with AI is especially prevalent. AI platforms have shown tendencies to produce inaccurate information or even ‘hallucinate’; meaning information is made up based on existing data. Errors have the potential to create significant consequences for employers. For example, errors in calculating deductions from an employee’s remuneration can result in unlawful deductions being made. Unlawful deductions from an employee’s remuneration may result in an employer facing fines of up to AED 1,000,000 according to Article 63 of the UAE Labour Law. Furthermore, making inaccurate deductions may also damage the trust between employers and employees, and lead to disputes. Subsequently, it is important for payroll professionals to maintain human involvement and supervision when using AI, in order to mitigate the
risk of inaccuracy. Human involvement may also be required in light of the Federal decree by law No. 45 of 2021 Concerning the Protection of Personal Data (the ‘UAE Data Protection Law’). The UAE Data Protection Law sets out guidelines for the use of automated processing, meaning the processing of data through an electronic program or system which operates in an automated manner. Under Article 13 of the UAE Data Protection Law, data subjects have the right to know whether a decision was made based on automated processing. Furthermore, under Article 18 of the UAE Data Protection Law, data subjects have the right to object to, and require review of, decisions made based on automated processing. However, data subjects may not object if they give explicit consent. This means that employers may need to not only maintain human supervision when using AI but also have an established review mechanism with payroll professionals if an employee decides to object to a payroll decision made through automated processing.
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