The gig economy has made misclassification one of the most significant compliance concerns for HR managers. With new regulations and laws being created left and right, it’s hard for HR managers to keep up with all of the changes.
If you misclassify an employee, then you could be fined by the government for noncompliance. And that’s just the beginning. That’s why AI is so important in this space: it can help manage compliance concerns by following current regulations and automatically classifying workers based on the latest information.
In addition to following changes in regulations and laws, AI also helps with paperwork errors and other tedious mistakes humans easily make. This article explains why it’s time that HR professionals took advantage of AI to solve many of their biggest challenges.
AI is a cost effective way to avoid misclassification
The gig economy is changing how we view employment opportunities but also giving rise to major compliance issues like classification by worker status (i.e., independent contractor vs employee). The lines between “employee” and “independent contractor” can often become blurred in the uncharted waters of the Future of Work.
Artificial Intelligence is a cost effective way to mitigate compliance risk because it is able to follow the latest changes in regulations and laws. One reason it’s cost effective to use AI for regulatory monitoring is because you don’t have to hire as many people. AI does the job of a whole team with just the click of a button.
AI helps avoid worker misclassification by automating the process of thoroughly and consistently verifying classification. Our AI uses more than 50 data points to determine a worker’s proper classification. When you use GreenLight’s AI-powered worker classification, our AI algorithm determines the correct worker classification. In order to mitigate compliance risk, we either make them an employee of GreenLight, or we contract them as an approved contractor.
AI is able to process large amounts of data and make sense of it
The amount of data we have today is overwhelming. AI can process it and learn what the data means, which will help us understand more about our world than ever before. InfoWorld points out that, “AI systems have the ability to process enormous amounts of data, and their accuracy increases along with the data volume.” Because AI can process and learn from so much data, it helps HR professionals improve data accuracy and efficiency.
Accurate data is a significant part of compliance, but it’s not enough to have accurate information. You also need to protect it and most importantly keep the data relevant. AI does this work at lightning speed and maintains the highest standards.
As an automated system, AI can provide better results than humans alone. You still have an obligation to understand how worker classification plays out in your organization, but using AI means you’ll be prepared to support any risk assessment claims with legitimate data.
AI is capable of more impartiality and less bias than humans
While we are moving toward a world where AI is completely impartial and unbiased, we are still haunted by stories like the one about Amazon’s AI recruiting tool that learned from biases within the data and learned to prefer men over women. Stories such as this one created mistrust around AI for many, and yet it was an excellent learning opportunity for a tool that will inevitably be used in the future.
AI is still new technology, and it is getting more intelligent and fair every day. New technology comes with benefits and also the potential for new discoveries. Thankfully, when it comes to compliance and worker classification, it’s possible to create an AI-algorithm that is less susceptible to bias.
AI is able to utilize information from regulations and laws, like California’s ABC test, in a way that is impartial and free of human emotion and ulterior motives. AI’s application of machine learning algorithms and deep neural networks enable businesses to more accurately tailor their turnover or payroll tax obligations, saving time and money in the process.
AI makes 24/7 support accessible
Artificial Intelligence has made it easier for employees and employers alike to ensure around-the-clock support. A worker who is able to look into their invoices and tax documents outside of normal business hours is a more satisfied worker.
A payroll system that uses AI gives you best-in-class workforce analytics that allow your extended workforce mechanism to function as a well-oiled machine. Technology has made it easier than ever before for businesses, no matter their size or location, to offer 24/7 support without needing a staff member available at all times.
AI is a great way to make your workforce compliant and reduce hiring expenses; it allows you to on-board workers in just minutes without needing additional training for your employees or workforce. A great support system is a key retention mechanism, and AI makes constant support accessible so your workforce can have peace of mind and clear communication at their fingertips.
Implementing AI is simple and saves on labor
Some new technology may sound helpful, but often people don’t make the change because the tool is too difficult to implement. When it comes to certain new AI platforms and tools, utilization is much more simple than you’d expect. GreenLight, the world’s first AI-driven classification engine, is safe and simple to use.
GreenLight’s innovative system uses all of the data and industry knowledge at our disposal in order to classify workers with an exceptionally high level of confidence. We’re classification experts who rigorously update and maintain our systems in compliance with the most recent laws, mandates, and court rulings.
With GreenLight, all you have to do is find the right person for the job. We’ll handle the rest. Schedule a demo today.
