But new report highlights importance of transparency in how AI is used
Employees are increasingly getting comfortable with the idea of artificial intelligence tools having a hand in compensation decisions, according to a new report, which reiterated to employers that transparency remains essential in the process.
Findings from a new Resume Now poll indicate that 67% of jobseekers are more likely to accept a job at a company that uses AI in compensation decisions.
According to the report, 90% of the respondents are at least somewhat comfortable with AI in compensation, so long as it is paired with clear expectations and managerial oversight.
Nearly half of the respondents (42%) said they were comfortable with AI deciding up to 25% of their compensation. A further 39% would allow up to 50% and 13% would allow more than half.
Only 6% of the respondents said they would not leave AI to decide on their compensation. Another 66% also believe that managers' pay decisions should take priority.
What makes AI great in pay?
The growing trust in AI tools when it comes to pay decisions stems from the perception that the technology can be consistent with market benchmarking and does not have biases.
"For job seekers, AI in compensation signals market benchmarking and an attempt to reduce favoritism," the report read.
But the report underscored that AI's role should be relegated to an input provider, not the sole decision-maker.
According to the findings, 59% of employees would trust their managers more than AI when it comes to pay decisions. In fact, 66% believe that managers' pay decisions should take priority over AI's when they disagree about pay.
The findings come amid HR leaders' growing pay-related use cases for AI tools.
A survey by MHR last year revealed that 88% of employers are already using AI in their payroll processes, with the top benefits being reduced errors, automated tasks, and enhanced data security.
Transparency is still essential
But even if employees are slowly getting comfortable with AI use in payroll decisions, the Resume Now report underscored the need for organisations to remain transparent.
"The biggest gains come when employers explain how AI informs offers and where human oversight applies," the report read.
It stressed that organisations earn trust by explaining how AI benchmarks are built, how often market data is refreshed, and who has the final say if systems and managers diverge.
"With clear criteria, manager review, and an appeals path, candidates can compare offers with more confidence and negotiate specifics such as pay bands, location adjustments, and bonus rules," it added.
