Big Data, Big Problems: The Liability Pitfall Lurking Beneath The Shiny Surface Of "People Analytics"

The use of big data in employment decisions—a practice often referred to as "people analytics"—has exploded in recent years. Lately, however, the concept is gaining more and more attention not only for its appeal of faster and more efficient hiring, but also for the significant risks it can pose. One key risk is the potential for a disparate impact claim, particularly on a class-wide basis. So while proponents of using software tools and algorithms to identify and select job candidates claim people analytics is more efficient and effective than traditional recruiting and selection procedures, employers should take care when choosing tools and vendors, and should proactively monitor their implementation to avoid big liability.