Challenges of Digitalization in Labor Relations: Employee Monitoring and AI-Powered HR Systems
On March 5, 2026, the Pravo.ru portal published a commentary by KKMP partner Anna Maksimenko and KKMP senior associate Elena Poleva on the challenges of digitalization in labor relations.

Digitizing HR processes offers convenience but also carries risks. Electronic document management must be regulated, and geolocation tracking should only be permitted with written consent. While the risks associated with AI are still potential, transferring data to foreign services already carries the threat of actual fines.

There are already examples in court practice where the implementation of AI has led to layoffs and disputes with employees. Recently, a court ruled in favor of an employee who was fired after his duties were replaced by AI. The employee was offered the choice of switching to a two-hour workday with a reduced salary or resigning. Refusal to accept these terms led to dismissal due to a change in working conditions. The court found that a job reduction had in fact occurred, but the employer had failed to provide the employee with the guarantees required by law upon dismissal (Case No. 33-34099/2025).

The implementation of AI systems capable of performing employees’ functions does not, from the perspective of labor law, constitute a change in technological working conditions and cannot serve as an independent basis for terminating an employment contract,” comments Elena Polevaya.

An employer’s right to monitor employees’ activities using corporate equipment equipped with monitoring systems carries risks of violating labor laws and personal data protection laws.

To minimize risks, Anna Maksimenko recommends adopting local policies that clearly define the objectives, methods, and frequency of monitoring, as well as the scope of data and access to it, and obtaining employees’ written consent to the processing of their personal data, signed by them.

Monitoring should be conducted during working hours and using a corporate device equipped with monitoring capabilities. Requiring the use of personal devices is illegal,” comments Anna Maksimenko.

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