People Reduce Workers' Compensation for Using Artificial Intelligence (AI)

Jin Kim, Shane Schweitzer, Christoph Riedl and David De Cremer

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Abstract: We investigate whether and why people might reduce compensation for workers who use AI tools. Across 10 studies (N = 3,346), participants consistently lowered compensation for workers who used AI tools. This "AI Penalization" effect was robust across (1) different types of work and worker statuses and worker statuses (e.g., full-time, part-time, or freelance), (2) different forms of compensation (e.g., required payments or optional bonuses) and their timing, (3) various methods of eliciting compensation (e.g., slider scale, multiple choice, and numeric entry), and (4) conditions where workers' output quality was held constant, subject to varying inferences, or controlled for. Moreover, the effect emerged not only in hypothetical compensation scenarios (Studies 1-5) but also with real gig workers and real monetary compensation (Study 6). People reduced compensation for workers using AI tools because they believed these workers deserved less credit than those who did not use AI (Studies 3 and 4). This effect weakened when it is less permissible to reduce worker compensation, such as when employment contracts provide stricter constraints (Study 4). Our findings suggest that adoption of AI tools in the workplace may exacerbate inequality among workers, as those protected by structured contracts face less vulnerability to compensation reductions, while those without such protections risk greater financial penalties for using AI.

Date: 2025-01
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