17 May 2023

Legal Challenges of Using AI Tools in the Workplace

  • Articles
  • Legal
  • Blockchain / Digital Assets
  • Data / Technology / IP

AI-powered applications bring many benefits to businesses, but also legal challenges.

Software applications that use artificial intelligence ("AI Tools") (e.g., ChatGPT, Midjourney, Bard, Stable Diffusion etc.) are used by many companies in their daily work. The benefits of these AI Tools are obvious: work processes are optimized and accelerated. As a result, costs and time can be saved.

However, from a Swiss law perspective, several aspects need to be considered when using AI Tools, as their use touches on various areas of law. Before using AI Tools, an appropriate and individual legal analysis should be carried out. In particular, the following legal parameters should be considered in your business in order to avoid pitfalls (non-exhaustive list):

1.              Data Protection

Before using AI Tools, it should be checked whether the data used or entered into the AI tool (including, for example, images and text) qualifies as personal data within the meaning of the Swiss Federal Act on Data Protection ("FADP") and for what purposes the data is processed, since according to the FADP, personal data may only be processed lawfully. Where personal data is processed, it is required by law and advised by the Federal Data Protection and Information Commissioner (FDPIC) (link) that the principles and obligations under data protection legislation are complied with in relation to such processing (e.g., accuracy of the data, proportionality of the processing, cross-border disclosure of personal data, information obligations, protection of data subjects' rights).

2.              Secrecy Obligations

It is important to consider legal and contractual confidentiality obligations when using AI Tools. Therefore, it is necessary to assess in advance whether the use of AI Tools violates legal and/or contractual confidentiality obligations. It is also important to assess the impact of using AI Tools on your own business and professional secrets, as the use of AI Tools could lead to their (unintentional) disclosure. Thus, it must be ensured that corresponding duties of confidentiality are complied with.

3.              Intellectual Property Rights

Depending on the respective AI Tool and its specific use, intellectual property rights, in particular the copyrights of third parties (e.g., in works of art or literature), must be considered. For example, training AI Tools with copyrighted works or publishing outputs generated by AI Tools that are too similar to existing copyrighted works, may infringe the copyrights of third parties.

4.              Transparency Obligations

EU's future Artificial Intelligence Act ("AI Act") may also entail (in particular, but not exclusively) transparency obligations for Swiss companies. These may also arise from other legal provisions or self-regulation.

Even without a legal obligation, transparency may be worth considering for reasons of trust and reputation.

5.              Reliability and Correctness of the Output

It is also important to consider that the use of AI Tools for artificial generation and modification of data can lead to incorrect or discriminatory results. The output of AI Tools should not be relied upon but should be subjected to human review.

6.              Conclusion and Recommendation

Due to the above-mentioned pitfalls and complex legal requirements, you should only use AI Tools in your business after conducting an in-depth legal analysis and conducting regular reassessments. In doing so, you should also check whether you fall under the scope of foreign law (e.g., the General Data Protection Regulation ("GDPR") or the AI Act.

Furthermore, we recommend that you establish internal guidelines to regulate the use of AI Tools. These guidelines should, among other things, define appropriate framework conditions as well as instructions for action, roles, and responsibilities in connection with the use of AI Tools. In addition, the training of employees in the use of AI Tools has proven to be effective not only with regard to legal pitfalls but also with regard to an efficient handling of such tools.

Would you like more information on the use of AI Tools in your organisation? Our legal experts are available to answer your questions on this and other AI topics. We look forward to hearing from you.