AI use in employment disputes soars, threatening to clog courts

08 October 2026

From sprawling personal grievances to confidential company information being fed into open AI tools, employment lawyer Rosemary Wooders says artificial intelligence is creating new risks across the workplace.

WATCH AND READ: The use of artificial intelligence in employment disputes has soared in the past year, threatening to clog up courts and risking leaks of confidential information, an employment law expert says.

Bell Gully partner Rosemary Wooders says AI is now embedded across the employment relationship from hiring through to disputes.

She says employers need to ensure that they have up to date policies in the workplace that deal with fast-changing technology and they should make the rules around AI use clear to employees.

How AI is changing employment disputes
How AI is changing employment disputes

Wooders tells Newsroom that before people started using AI, personal grievance letters tended to be relatively short in length and took some time to prepare, along with court documents.

AI has sped up the process exponentially and the paperwork is many times greater, she says.

Employees also need to be aware of AI’s tendency to produce overly favourable documents and make unrealistic recommendations to the user.

Wooders also warns that AI-related issues are emerging in other areas of the workplace relationship.

The confidentiality risks of AI at work
The confidentiality risks of AI at work

She says there are cases where workers have been unwittingly feeding confidential information into open AI which could end up in the wrong hands.

She cites a case with the Employment Relations Authority last year that highlights the dangers of using open Generative AI tools like Chat GPT to help draft documents and cutting and pasting confidential company details into AI.

Employers need to understand the difference between open and closed AI and set boundaries around how the technology is used, she says.

AI lawyers and access to justice
AI lawyers and access to justice

AI advances are now at a point where individuals are paying so-called AI lawyers to help win their case.

Wooders refers to a landmark case in the UK in June that it is believed to be the first time a trial has been won using an AI lawyer.

Supporters of AI lawyers say it opens up the justice system for small businesses and individuals who previously could not afford litigation and have had to write off debts.

Wooders says people should be wary of relying solely on AI.

The Guardian in June reported that the British legal profession had been “shaken by a number of high-profile AI blunders”.

Recently, it says, an international law firm referred itself to the Solicitors Regulation Authority after it revealed results from an internal AI search twice mislead a court.

Can AI replace human lawyers?
Can AI replace human lawyers?

As AI becomes more sophisticated many question whether there is still a place for human lawyers.

Wooders says there is no replacement for human expertise in the legal process.

AI is developing to a point where its first drafts for CVs and other documents will be more polished.

But while AI is becoming increasingly proficient at writing documents humans are still needed for oversight, to check the wording is accurate and to make judgement calls on the content.

When it comes to knowing the subtle differences about clients and their particular style, humans cannot be replaced, she says.

This article was originally produced by Newsroom in partnership with Bell Gully and is republished here with permission.


Disclaimer: This publication is necessarily brief and general in nature. You should seek professional advice before taking any action in relation to the matters dealt with in this publication.