Preparing For An AI-Transformed Workforce - Analyzing Job Impacts, Legal Structures, And Government Policies
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Category: Administrative & Regulatory Law
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PREPARING FOR AN AI-TRANSFORMED WORKFORCE:
ANALYZING JOB IMPACTS, LEGAL STRUCTURES, AND GOVERNMENT POLICIES Mr. Rishabh Jayasimha, B. Com LLB (Hons.), Jindal Global Law School, Sonipat
ABSTRACT
This paper primarily focuses on the ever-increasing relevance and presence of Artificial Intelligence within the employment sector in India. To begin, it first analyzes the existing state of artificial intelligence and the various sectors that have raised concerns about impending automation. Further, it discusses the nature of legal frameworks in place to ensure adequate recourse to workers that face displacement due to the onset of AI/ automation of their respective jobs. The paper briefly also provides a comparative study of recourse available to workers in a global context to manage unemployment due to technological advancements and the onset of AI1. The paper also highlights a few case studies that focus on the rising redundancy of tasks such as programming, accounting, and consultancy.
Although AI is estimated to eventually ‘create’ a large pool of jobs, namely engineering, data science, among others, this paper will restrict itself to the recourse available to workers among the existing workforce that are on the verge of displacement. Through a consideration of available alternatives to the existing workforce, along with central governmental initiatives, this paper highlights the employment sector’s efforts of attempting to ensure re-skilling efforts, and transitions into other alternative positions within the sector to maximize workforce efficiency. The paper also dwells on governmental initiative surrounding the impending issue and delves into policy recommendations put forward to combat the same.
Overall, the paper attempts to address the challenges of integrating Artificial Intelligence within the workforce and discusses existing and prospective legal reforms to ensure maximum worker retention2. (No date) Ris. Available at: https://www. ris. org. in/sites/default/files/Publication/Policy%20brief- 104_Amit%20Kumar. pdf (Accessed: 19 March 2024). 2 Valerio De Stefano (no date) Automation, Artificial Intelligence and labour protection, Negotiating the algorithm”: Automation, artifi cial intelligence and labour protection. Available at: https://www. ilo. org/wcmsp5/groups/public/---ed_emp/---emp_policy/documents/publication/wcms_634157. pdf (Accessed: 19 March 2024).
There is consensus that existing legislation may not adequately ensure worker protection especially from AI caused displacement. However, this creates a larger onus to ensure a balance between innovation on one hand and workers’ rights on the other. One such example that Indian legislation can draw from is the EU’s approach to AI regulation, that could provide some guidance to base new legislation off, and ensure safeguards are in place just as such technology is permeating across sectors as we have seen recently.
This paper aims to further the discourse into legal recourse that is already available for workers that face displacement due to AI led unemployment, as well as provide insight into other policy recommendations for Indian legislation drawn from other global administrations to implement that may prove fruitful in maximizing workers’ rights while balancing the need for technological development across the employment sector3. Introduction With the introduction of Artificial Intelligence into the workforce across industries, there have undoubtedly been apprehensions regarding the redundancy of human workforces. This application of AI is seeing sideway growth into numerous industries which is raising concern regarding worker recourse in situations of AI led unemployment.
Existing labor and employment legislation in the Indian setting has not considered workers’ recourse in the case of technological advancements causing layoffs4. To address labor protection in undeniable situations of Artificial Intelligence taking over in manufacturing, IT, accounting, creative work etc. , it becomes important for policy recommendations to arise & amend existing legislation to consider the current status quo in a timely manner. This involves entering a comparative legal study with other jurisdictions that have tackled similar problems and analyze shortcomings prior to policy implementations. Such policy recommendations involve the integration of AI into a workforce that offers the least displacement of existing human workforce, through methods of retaining human capital in manners ‘supplemental’ to the application of AI within such fields5.
This paper will analyze the impact of AI on different sectors, view and criticize the existing legal framework, provide comparative legal studies of other jurisdictions, and finally propose means of policy intervention for the integration of AI into employment fields, 3 19, A. M. (2023) The impact of artificial intelligence on employment law and worker protections in India. , The Amikus Qriae. Available at: https://theamikusqriae. com/the-impact-of-artificial-intelligence-on-employmentlaw-and-worker-protections-in-india/ (Accessed: 19 March 2024). 4 ‘AI Impact on India: Jobs and Employment’ (INDIAai) accessed 17 April 2024. 5 (Automation, Artificial Intelligence and labour protection) accessed 17 April 2024 i. e. , re-training & skilling initiatives to ensure the most inclusivity regarding a prospective workforce with both Artificial Intelligence and human capital6.
Impact Analysis In terms of the sectoral impact within the workforce, AI can do three things, namely: create new work opportunities for human workers, offer methods to supplement existing human workers, and finally, outrightly replace human workers altogether. In the Indian context, the consensus seems to involve the rising redundancy within tasks/jobs that are highly repetitive & those involving the analysis or processing of large bulks of data; a job that AI has proved itself more than capable in the current day and age. On the bright side, there is also a growing consensus over the emergence of newer roles involving supplementing AI systems, developing better AI systems, and others within the immediate AI sphere itself. Within the workforce, there are naturally certain sectors that raise concern considering the prospects of automation within them.
Apart from manufacturing & production sectors, especially within the automative and electronic subsets, sectors like banking & finance, retail, information technology and even agriculture sectors are at risk. The common triggers that the impact analysis can point toward are clearly reduction of costs, task performance with greater durability and precision, and overall task to task efficiency7. To provide more clarity regarding the common triggers, if we observe the overall trend within the above identified industries, we see a high degree of ‘routine’ and ‘repetitiveness’ within the manufacturing and production industries, along with higher labor costs and a lower degree of efficiency compared to substituting workers out for AI.
Similarly, within banking and finance, there exist huge amounts of data to be processed that AI has specifically in some iterations been created for and can perform much better than humans. Within the information technology sector, there seems to be a greater risk of redundancy due to more rapid technological change and more efficient software automation that leaves human programmers moot. Lastly, within the agricultural sector, the use of precision AI systems can make the entire farming process more efficient, timely, and reduce or even remove the need for manual labor within agriculture.
In terms of the ability to scale up operations too, AI systems dwarf their human counterparts (Ris) accessed 17 April 2024 7 M R, ‘Risks and Benefits of Artificial Intelligence for India’s Employment and Agrarian Economy’ (LinkedIn, 2 July 2021) accessed 17 April 2024 due to their ability to ramp up scales of production at much lower costs than having to spend on more labor8. While the sectors highlighted above are the ones at the higher end of the spectrum concerning automation of tasks within the workforce, there are other sectors too that are seeing a boom in terms of automation within the field of AI and its application. Healthcare is seeing a large chunk of technological advancement in terms of AI application as a supplemental tool of sorts within the sector, to aid doctors to perform their services in a manner that reduces any existing risk of negligence.
However, as discussed above within the common trigger points, healthcare, and a few other sectors, although in possession of good tech improvements, are not yet in the focus of the debate of widespread job displacement. This is primarily because of the social aspect, human interaction and social intelligence factors that still are at the forefront of practicing individuals within these sectors and relatively still ‘in development’ with respect to AI’s evolutionary characteristics that keep them out of risk’s eye in the present. Existing legal framework & Policy Recommendations As laid out above, with AI systems starting to develop and get more proficient at the tasks they’re designed to perform, the reliance on human capital to get the same tasks done will begin to reduce and virtually become null.
To address this, it becomes important to determine any existing protections or recourse already available to workers within the identified sectors in Chapter I and determine their efficacy in ensuring equitable alternatives or specific worker protection & redressal systems9. Overall, India does not have a specific law governing Artificial Intelligence yet, and as for the labor codes concerned, i. e. , the Industrial Disputes Act10, and The Shops and Establishments Act; they both deal with a relatively outdated understanding of employer-employee relationships. Either way, neither of these acts address AI based termination or loss of employment explicitly. The idea of ‘jobs’ and ‘work’ as highlighted by our codified labor laws
8 CA F, ‘Govt Admits AI Can Lead to Job Losses in India’ (The New Indian Express)
accessed 17 April 2024 9 19 AM, ‘The Impact of Artificial Intelligence on Employment Law and Worker Protections in India. ’ (The Amikus Qriae, 30 April 2023) accessed 17 April 2024 (The Industrial Disputes Act, 1947) accessed 20 April is one that is growing to be outdated in the nature of a lot of roles shifting to remoter conditions in the present context. Similarly, worker protections also need to be aligned with the existing status quo in terms of ‘nature of work’ and ‘technological changes’ over time; both of which change with time and technology11. Under Chapter III and IV of the Constitution of India12, the right to ‘work’ has been enumerated time and again under Article 21 as a right that stems from the right to life.
Further, as Directive Principles of State Policy also highlight under Articles 38, 39, 39(a), and 41 of the Constitution, the state is bound to ensure welfare of people through provisions of employment as and when necessary. In addition, the state holds a duty to uphold social justice and well-being, which intrinsically include the protection of individuals against widespread unemployment. Even though the DPSP’s highlighted are not immediately justiciable, the state must embark of fruitful endeavors to ensure the success of such DPSP’s in the intent of which they were inserted into the Constitution13. Next, under the Seventh Schedule of the Constitution, the Union and State are both empowered to decide upon labor matters enumerated within their respective lists.
Entry 55, 61 & 66 of the Union list permits the Union to legislate on certain labor matters while Entry 22, 24 & 33 of the Concurrent list enable both the union and states to legislate over labor matters concerning industrial and labor disputes, as well as unemployment situations. Under the Industrial Disputes act 194714, the right to workmen laid off for compensation is enumerated under Chapter VA, clause 25C, subject to exceptions under clause 25E. The conditions for retrenchment and procedure for such retrenchment is also laid out. The act also prohibits lay-offs except under certain situations which unfortunately do not seem to address lay-offs due to technological improvements/changes, therefore leaving the argument pertaining to AI induced lay-offs unanswered.
Similarly, the Factories Act 194815, the recent Industrial 11 arifimam0090, ‘Artificial Intelligence and Employment Law: Balancing Innovation and Workers’ Rights’ (Lexosphere, 19 November 2023) accessed 17 April 2024 12 (The constitution of India) accessed 20 April 2024 13 taxguru_in and Shrivastava C, ‘Constitutional Protection of Labour Rights in India’ (TaxGuru, 26 April 2023) accessed 17 April 2024 (The Industrial Disputes Act, 1947) accessed 20 April 15 (The Factories Act, 1948) accessed 20 April Relations Code 202016, and the Code on Social Security 202017 fail to address termination of employment on the grounds of technological advancements brought about by the onset of AI within the workforce18. There are naturally some policy recommendations concerning all these labor codes at our disposal that fail to address termination caused by AI19.
Within the Industrial Disputes act 1947, specific sections for technological unemployment that details the procedure behind termination on the grounds of tech advancements are useful. In addition, higher severance pay due to the nature of redundancy caused, along with a mandate for employers to contribute to re-skilling initiatives of terminated workers is feasible. Reemployment benefits may also be offered to employees wherever new roles are created simultaneous to termination of redundant ones20. As for the Factories Act 1948, mandatory re-skilling initiatives must be introduced to ensure safety and training for workers that are retained to work alongside technological introductions. A mandate to consult workers’ unions could also prove fruitful to technological ‘integration’ and better understanding of the tradeoffs.
The Industrial Relations Code 2020 can expand existing ‘definitions’ to include and define what constitutes tech advancement and the nature of workers’ rights under such a situation. This can be logically drawn from other jurisdictions, and we will revisit it in the succeeding chapter when we compare jurisdictions and their respective policies. Lastly, under the Code on Social Security 2020, a specific introduction of benefits available to 16 (Industrial Relations Code, 2020) accessed
20 April 2024
(The code on Social Security, 2020) accessed 20 April 2024 18 (Rethinking Indian labour law and policy in the age of artificial intelligence: A Futuristic Analysis - International Journal of Legal Science and Innovation) accessed 17 April 2024 19 ‘Ethics and the Future of Work’ (Deloitte Insights) accessed 18 April 2024
20 Bensha C Shaji and Angel Shaji, ‘ANALOGY BETWEEN THE DEVELOPMENT OF ARTIFICIAL
INTELLIGENCE AND EMPLOYMENT SECTOR - NATIONAL AND INTERNATIONAL ASPECTS’ (NALOGY BETWEEN THE DEVELOPMENT OF ARTIFICIAL INTELLIGENCE AND EMPLOYMENT SECTOR
NATIONAL AND INTERNATIONAL ASPECTS) accessed 18 April 2024.
terminated workers on grounds of technological advancements that stem from a fund that employers are mandated to set up to consider such situations would prove to be fruitful. Another recommendation across all the above statutes would be to uniformly increase notice period requirements for such terminations caused on the ground of AI taking over jobs/any other such technological introduction leading to employment redundancy. Comparative Legal studies For the purposes of a comparative analysis, we will focus on the jurisdictions of the United States, the United Kingdom, & the EU. In the United States, individual states have begun to adopt initiatives to protect workers. These state-initiated actions have also been backed by central administration’s efforts through the Biden presidency issuing orders that lay out certain ‘guiding principles’ into the application of AI into the workforces.
These include the cultivation of standards to mitigate the harm caused to inadvertently to workers being displaced in the process. The order also recognizes the importance of cultivating a more skilled workforce through the processes of re-training/skilling programs, along with better education and alternate employment opportunities21. Further, another noteworthy feature is the robustness of the existing social security scheme in place across the US which naturally offers for a more streamlined approach between establishing statutory notice periods for companies seeking to terminate workers, and the emergence of other work opportunities for terminated workers22. As for the United Kingdom, the government has mandated regulators to make available to the public, their approaches to managing AI systems23.
It has identified high risk jobs likely to be automated across sectors and amped up local education opportunities to adapt to new employment created, as well as targeted intervention facilities to intimate employees likely to 21 Bklemm@foley. com, ‘Highlights from the Biden Administration Executive Order on Ai’ (Foley & Lardner LLP, November 2023) accessed 18 April 2024
22 Grimshaw A, ‘Mounting a Response to Technological Unemployment’ (The Century Foundation, 27 April
2022) accessed 18 April 2024 ‘UK Signals Step Change for Regulators to Strengthen AI Leadership’ (GOV. UK) accessed 18 April 2024 lose their jobs and ensure higher retention rates within businesses24. The European Union is once again at the forefront of AI regulation with their ‘Artificial Intelligence Act’25. As for the state of their employment and labor regulations, it is safe to say that the EU has ensured promotion of worker benefits in the event of ‘market changes’ that include technological improvements26. Social Security efforts have also been ramped up with the introduction of the European Employment Strategy (EES)27, and the European Pillar of Social Rights (EPSR)28. The Europe 2020 strategy29 can also be seen accommodating ideas to ensure lower unemployment rates, skill development and job creation.
The existence of an emergency fund to support unemployment risks is also another definitive move in the direction of ensuring a secured workforce30. Even OECD countries have begun employing strategies like hikes in minimum wage, promotion of collective-bargaining techniques among workers, especially due to low skilled labor being the most susceptible to widespread displacement and the worry of an already exacerbated income gap31. Programs to help workers navigate transitions between termination, to re-skilling and finally productive employment is what governments are beginning to focus on32.
WEF publications also discuss the future of job markets and the imperativeness to prepare 24 aiforgoodstg2, ‘Ai and Jobs: 4 Key Steps Governments Can Take to Limit Job Displacement’ (AI for Good, 2 September 2021) accessed 18 April 2024 25 ‘“on Artificial Intelligence, Trust Is a Must, Not a Nice to Have,” One Lawmaker Said.
#AI’ (World Economic Forum) accessed 18 April 2024 26 ‘Social and Employment Policy: General Principles: Fact Sheets on the European Union: European Parliament’ (Fact Sheets on the European Union | European Parliament) accessed 18 April 2024 27 ‘European Employment Strategy’ (European employment strategy - Employment, Social Affairs & Inclusion - European Commission) accessed 20 April 2024 28 Leyen P von der, ‘European Pillar of Social Rights - Building a Fairer and More Inclusive European Union’ (European Pillar of Social Rights - Building a fairer and more inclusive European Union - Employment, Social Affairs & Inclusion - European Commission) accessed 20 April 2024 (Europe 2020) accessed 20 April 2024 30 ‘Social and Employment Policy: General Principles: Fact Sheets on the European Union: European Parliament’ (Fact Sheets on the European Union | European Parliament) accessed 18 April 2024 31 ‘Home’ (OECD Employment Outlook 2023 : Artificial Intelligence and the Labour Market | OECD iLibrary) accessed 18 April 32 ‘Home’ (OECD.
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for such radical transformations like the one caused by the introduction of AI into the workforce and promote methods like re-skilling initiatives, creation of new jobs, and policy implementations33. The common link between all such jurisdictions is the importance of devising new labor and employment policies, in line with preparing for constantly fluid job markets, while ensuring that the displaced workforce is provided ample opportunity to avail re-training and alternate employment opportunities. These policies when applied effectively will conclusively result in a more productive workforce. Government Intervention The Indian government furnished the NITI AAYOG’s ‘National Strategy for AI’ which laid out recommendations to ensure that workers are protected from widespread displacement.
Much like the US’s approach, one of the key recommendations was reskilling of redundant workers by employers themselves. Further, the strategy also addresses the grassroot problem and suggests an alignment of the education system to include relevant skills from an AI driven economy. This would involve an alteration in curriculum & encouraging professional AI education through supplementary courses. The third recommendation was to set up a ‘task force’ to continuously monitor the spread of AI into other sectors and to ensure notice to employees under threat. The establishment of a task force would also ensure availability of market analytics for successive policy decisions.
The strategy focuses on ensuring a responsible market driven approach to the implementation of AI within the workforce which involve upholding privacy norms, security standards, and maximizing the commercial benefit brought about by AI34. The Ministry of Electronics (MEITY) in its ‘Vision of India AI Report’ reiterates the challenges within the NITI AAYOG’s report that include an unskilled and untrained workforce without access to adequate AI expertise or skilling opportunities35. 33 ‘The Future of Jobs Report 2023’ (World Economic Forum) accessed 18 April 34 (National strategy for artificial intelligence) accessed 18 April 2024 35 ‘The Aidea of India : Generative AI’s Potential to Accelerate ...
’ (The AIdea of India Generative AI’s potential to accelerate India’s digital transformation) accessed 18 April 2024 36 ‘AI Impact on India: Jobs and Employment’ (INDIAai) accessed 18 April 2024 has borrowed policy implementations from other jurisdictions and molded them to fit our context37. As the phrase goes, “The US creates, the EU regulates, and India follows”, it is clear from the discussion that the EU’s labor policies lead the issue concerning the worker protection from AI induced unemployment. With the spread of AI across sectors, it becomes imperative to reassess and revamp workers’ recourse in such situations and put in place mechanisms that provide insurance and viable alternatives to mere unemployment. 37 Pew Research Center, ‘2. Solutions to Address AI’s Anticipated Negative Impacts’ (Pew Research Center: Internet, Science & Tech, 10 December 2018) accessed 18 April 2024