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Key takeaways
- Ontario's new job posting disclosure requirements under the Employment Standards Act came into effect on January 1, 2026, mandating employers to disclose AI use in in the hiring process.
- Employers must clarify how AI is used to "screen", "assess", or "select" applicants, but the lack of detailed guidance raises questions on compliance.
- Employers should update job postings and relevant policies to reflect the AI disclosure requirement and ensure transparency.
On January 1, 2026, Ontario's new job posting disclosure requirements under the Employment Standards Act, 2000, SO 2000, c 41 (the ESA) came into effect.These disclosure requirements apply to employers with 25 or more employees on the day a publicly advertised job posting is posted.A "publicly advertised job posting" is defined as "an external job posting that an employer or a person acting on behalf of an employer advertises to the general public in any manner."However, this does not capture general recruitment efforts that do not advertise specific positions, internal job postings, or postings for roles performed outside Ontario (including roles inside and outside Ontario where the extra-provincial work is not a continuation of work performed in Ontario).
The new rules require, among other things, that employers disclose whether artificial intelligence (AI) is used to screen, assess, or select applicants in all publicly advertised job postings (see the December 2025 Employment and Labour Law blog: Reminder for Ontario employers: incoming public job posting requirements for more on all of the employer disclosure obligations that came into effect on January 1, 2026).
Scope of the AI disclosure requirement
In December 2024, we shared our preliminary views on Ontario's AI disclosure requirement (see the Employment and Labour Law blog: Working for Workers Four: 'artificial intelligence' disclosure requirement), and, since then, little has changed. The Ministry has yet to issue guidance on what is captured by the broad definition of "artificial intelligence", how to interpret key terms such as "screen," "assess," or "select", or the level of detail required when disclosing the use of AI. The lack of proactive regulatory guidance is somewhat curious given the increasing prevalence of AI in modern workplaces, including throughout recruitment processes (see the November 2025 Employment and Labour Law blog: AI in the workplace: what employers in Ontario need to know for further discussion of things to consider when leveraging AI in the workplace).
Given the absence of statutory definitions and Ministry guidance, employers are raising practical questions about how to comply with the AI disclosure requirement in practice.
Common employer questions
Q: What do we know about how to interpret AI-related terms that have not been defined in the absence of statutory definitions or Ministry guidance?
A: The accompanying regulations adopt a definition of AI that closely tracks the Organisation for Economic Co-operation and Development (OECD) framework, capturing machine-based systems that infer from inputs to generate outputs such as predictions, recommendations, or decisions that can influence outcomes. This, along with the discussions during the legislative record, suggests the disclosure requirement is intended to apply broadly to inference-based, machine-learning-enabled tools commonly used in recruitment that could typically exacerbate issues of fairness and bias (e.g., ChatGPT).
While the statutory terms "screen," "assess," and "select" are not defined, it is reasonable to assume they carry their ordinary meaning. The legislative record indicates that the disclosure requirement was introduced as a transparency measure for job seekers, particularly in response to concerns about bias, privacy and opacity where AI tools influence early hiring decisions, such as resume review and screening. Practically, the provision appears to be aimed at AI-enabled tools that influence whether and how applicants progress through the hiring process, including tools used to filter, rank, score, recommend, or otherwise evaluate candidates, even where a human ultimately makes the final hiring decision.
In the absence of prescribed thresholds, employers should adopt a defensible interpretation grounded in how AI is actually used in their recruitment workflows and be prepared to document why particular tools are, or are not, viewed as screening, assessing, or selecting applicants for the purposes of the disclosure requirement. Of course, this analysis remains subject to any forthcoming guidance issued by the Ministry.
Q: We use AI in the recruitment process — what should our AI disclosure statement look like?
A: While the ESA requires employers to disclose the use of AI in screening, assessing, or selecting applicants, it does not prescribe the form or level of detail of that disclosure. While a minimal statement confirming AI is used may satisfy the literal interpretation, the legislative record suggests the obligation is intended to promote meaningful transparency for inpiduals where AI may influence how they are evaluated or progress through the hiring process. Employers may, as a matter of business or strategic communications judgement, choose to provide additional information, such as the type of AI technology they use, the stage(s) of the recruitment process where it is used, and/or how human oversight is applied. While a more detailed disclosure statement may enhance perceived transparency and candidate engagement, it could also deter candidates from applying if they are not aligned with the company's use of the technology — or alternatively, it could lead to further questions or inquiries that may be a drain on internal resources.
In the current absence of guidance, there is no single best practice. The best approach will vary from workplace to workplace and depend on how AI is actually used in the recruitment process and the employer's broader communications, risk tolerance and hiring objectives.
Q: What documents should be updated in light of the AI disclosure requirement?
A: Employers should review and update key documents to reflect the new disclosure requirement. Job posting templates for publicly advertised roles should be revised to include the option to add the employer's AI disclosure statement should such technology be used to screen, assess, or select applicants. Recruitment policies and training materials should also expressly address the requirement and provide guidance for key personnel on determining when the disclosure requirement applies to a particular job posting; ensuring compliance when engaging third-party recruiters and job platforms; and responding to applicant inquiries about the company's use of AI in the recruitment process. In addition, if an employer maintains an AI policy — which we strongly recommend in almost all knowledge-based workplaces — the policy should be updated to incorporate the disclosure obligation.
Q: What are the consequences for non-compliance with the AI disclosure requirement?
A: Upon conviction, a corporation that contravenes or fails to comply with the ESA (or its regulations) is theoretically liable for a fine of up to $100,000, with higher fines for corporations with prior ESA convictions. Legal advice should be sought on any particular circumstances, although, in our experience, aggressive enforcement for non-monetary contraventions is generally not the first step Ontario regulators are likely to take. Further, employers may also experience reputational damage for non-compliance with the requirement. For example, candidates may equate a company's failure to disclose their use of AI with a lack of honesty or transparency, which may deter qualified candidates from applying for job openings, or hurt "word of mouth" referrals.
Employer best practices
- Identify AI usage across recruitment workflows: In light of the unresolved definitions and thresholds (e.g., what constitutes "screen," "assess," or "select" and "artificial intelligence"), employers could map recruitment workflows end to end, identify each AI-enabled step, and adopt a defensible disclosure position anchored in the text of the ESA and any available commentary. In practice, this would mean pinpointing where tools parse resumes, rank candidates, generate assessments, or otherwise influence applicant progression through the recruitment process — even where those steps are preliminary, embedded in third-party platforms, or subject to human oversight. Alternatively, given that AI is being integrated into even the most basic software suites (e.g., MS Teams, Outlook, Google Workplace, etc.), many employers are simply incorporating blanket disclosure in each job posting.
- Disclosure requirement as part of AI governance: Regardless of
the new ESA disclosure rules, these regulatory changes are a good
jumping off point for considering general AI-related risk
mitigation (see the September 2025 insight: Is your business ready for AI governance? for
more on how businesses can navigate the integration of AI systems).
Employers could consider the following approaches:
- Align internally: Employers should maintain consistent internal practices for complying with any AI-related regulatory requirements or risk mitigation best practices, and update these practices on an ongoing basis. To ensure uniform implementation across recruiters, hiring managers, and vendors, policies and training materials should specify the scope and purpose of AI usage in the workplace, including how to determine when and why it should be used during the hiring process, and how applicant inquiries will be addressed.
- Audit third-party tools: To help ensure sustainable and ongoing compliance and risk mitigation, employers should regularly inventory third-party recruiting tools and platforms to understand where AI is embedded and how those tools are configured. Vendor features may evolve and introduce new AI-enabled steps that could create evolving privacy, human rights, regulatory or other risks.
Conclusion
The AI disclosure requirement is now live, but some key interpretive questions regarding the details remain unanswered. We suspect these new Ontario requirements are the "tip of the iceberg" in terms of AI regulation in the employment context (at both the provincial and federal levels), and therefore represent an opportunity for employers to take stock of how and why AI systems are used in their workplace so that current and potential future regulatory requirements can be sufficiently addressed.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
