GDPR vs CCPA for AI Interview Software: Compliance Guide (2025)

Artificial intelligence software is becoming part of everyday hiring. Companies employ AI to conduct video interviews, screen resumes, or grade responses. They save time and compare applicants equally. They also collect and process personal information. That implies companies have to abide by privacy regulations.

This guide describes the essential differences between the European Union General Data Protection Regulation, or GDPR, and California privacy legislation under the CCPA and its update, CPRA. It is about AI-interview software and the necessary steps for startups and recruitment agencies in the United States to remain compliant in 2025. Important legal sources, regulator views, and practical measures are included.

Brief Overview: GDPR And California Privacy Legislation

GDPR is an EU regulation that is applicable to organizations dealing with individuals' personal data in the EU. It provides strict rules on lawful processing, data subject rights, transparency, data protection impact assessments, and automated decision-making. The European Data Protection Board has published guidance on how AI aligns with GDPR principles.

California legislation started with the CCPA and was updated by the California Privacy Rights Act or CPRA. The legislation provides California residents with rights to their personal data, like the right to know, erase, and opt out of specific uses. California is also building regulations for automatic decision-making because AI can influence hiring and employment decisions.

Why AI Interview Software Poses Special Rules

AI interview software can record video or voice, transcribe voice, extract keywords, grade responses, or flag conduct. Some software can input these records into grading models or generate an automated suggestion. Due to the following features:

The software handles sensitive personal information and biometric or inferred characteristics in some cases.
Automated judgment or profiling can seriously impact a job applicant.
Model errors or bias can cause unfair results or bias.

Regulators want firms to be cautious when they employ AI in recruiting. American federal agencies and privacy regulators warned of dangers and called for transparency and protection.

Main Legal Distinctions That Are Significant to AI Interview Software

The following are the key points recruiters and startups must understand when it comes to comparing GDPR and California privacy law.

Legal Basis For Processing

GDPR: You must have a legal basis for processing personal information. In recruitment, the usual grounds are consent or legitimate interest. If special category data or high-risk automated decision-making are involved, additional rules are required. You need to document the basis and tell it to the data subject.

CCPA/CPRA: The California regulations do not have a requirement for a lawful basis like that. Rather, they need to notice and provide consumers rthe ight to control certain usage of personal information. Companies need to include privacy notices and enable consumers to exercise rights like access, deletion, correction, and opt out of selling or sharing. CPRA also adds rights and imposes new obligations on businesses and service providers.

Practical takeaway: If you process EU applicants, follow the GDPR legal basis and transparency. For California applicants, focus on clear notices and rights management under CCPA and CPRA.

Automated Decision Making And Profiling

GDPR: Article 22 gives an individual's right not to be subject to a decision based on automated processing alone, which has legal effects or similarly significant effects. When it comes to recruitment tools that produce or contribute to decisions, you will require safeguards, the right to human review, and transparent information for the candidate. The EDPB has highlighted careful handling of AI and impact assessments.

CCPA/CPRA: California legislation focuses on consumer rights and use constraints over a direct Article 22-type prohibition. CPRA and California regulators do, however, trend toward requirements of risk analysis and disclosure where automated decision-making impacts consumers, especially in employment. Draft guidance and agency documents show regulators anticipate transparency and risk control.

Practical takeaway: Handle automated job decisions as high risk. Provide candidates with clear information, let humans review critical decisions, and document how the system operates.

Data Subject Rights

GDPR: Robust rights include access, rectification, erasure, data portability, restriction, objection, and rights associated with automated decisions. Controllers have to respond within strict time limits and explain results.

CCPA/CPRA: California consumers have the right to know what is being collected, to delete personal data, to fix inaccurate information, and to opt out of some sharing or selling. CPRA included the right to restrict the use of sensitive personal information and provided the CPPA with enforcement authority. Companies need to implement processes to handle requests.

Practical takeaway: Construct workflows to handle requests for access, deletion, and correction. For automated decisions, provide clear notification and, where appropriate, allow individuals to challenge or request human review.

Risk Assessments And Documentation

GDPR: For high-risk processing, GDPR requires a data protection impact assessment or DPIA. Most AI hiring tools qualify as high risk since they influence employment. The EDPB has provided opinions stating that AI models need to be evaluated for risks related to privacy early and frequently.

CCPA/CPRA: CPRA and California policymakers are encouraging risk-based evaluations for automated decision tools. The CPPA drafts indicate they expect companies to evaluate risks and record controls for automated decision-making impacting rights.

Practical takeaway: Conduct a DPIA or similar risk assessment prior to the use of AI interview software. Document your mitigation actions and update them as necessary.

Enforcement And Penalties

GDPR: Penalties are also harsh, with fines of up to 4 percent of worldwide annual turnover or 20 million euros, whichever is greater. Orders and corrective actions are also employed by regulators.

CCPA/CPRA: Enforced by California statute under CPPA and by civil penalties for violations. There is also a private right of action for certain data breaches. CPRA enhances enforcement authority and responsibilities for businesses and service providers.

Practical takeaway: Non-compliance can be costly in both areas. Document everything in writing and be prepared to demonstrate your compliance measures.

Practical Compliance Steps For AI Interview Software

Below is a step-by-step checklist for startups and recruitment agencies utilizing AI video interview tools.

Know who you process for and where they are based

Chart out whether candidates are in the EU, California, or elsewhere. This determines which laws you are subject to.

Craft clear candidate notices

Inform candidates what information you collect, why you do so, for how long you hold it, and with whom you share it. Keep the notice simple to read prior to recording answers. This aids GDPR transparency and CCPA obligations.

Determine lawful basis or legal approach

If you process EU residents, select and record a lawful basis for processing, such as legitimate interest or consent, and tell the candidate. For California, be sure to comply with notice and rights requirements.

Evaluate automated decision risk

Conduct a DPIA or similar. Determine risks of bias, unfair treatment, or inappropriate outputs. Outline how you will address them. Regulators expect this for AI hiring.

Establish human review and appeal

For hiring-recommendation ones, include a human reviewer and an apparent appeal path. Allow candidates to request human review where the decision is important.

Limit data collection and retention

Collect only what you require to make the hiring choice. Establish retention periods and erase data when no longer required.

Vendor and contract checks

If you engage third-party AI tools, obtain written agreements regarding the use of data, security, sub processor lists, and assistance with data requests. Data processing agreements are mandated by GDPR and best practice under California law.

Test for bias and accuracy

Test models for disparate impact across protected groups on a regular basis. Keep records of testing and remediation procedures. U.S. enforcement agencies have referenced biased hiring tools in complaints.

Prepare rights-request processes

Implement straightforward mechanisms for candidates to request access, erasure, rectification, or opt-out where permitted. Monitor and record requests and feedback.

Train staff

Educate recruiters and hiring managers on how the tool operates, what decisions it assists, and respond to candidate inquiries.

Special Points for Recruitment Agencies and Startups

Transparency Fosters Trust: Inform the candidates precisely how their video will be utilized and if AI scores will impact the hiring. It minimizes controversy and complaint exposure.
Employee Vs. Consumer Regulations: Certain regulations differentiate between employee and applicant data. California had employee data temporary exemptions under CCPA. Nevertheless, it is better to adhere to robust privacy guidelines for applicants as well.
Cross-Border Data Transfers: If you transfer data outside the EU, use legitimate transfer mechanisms like standard contractual clauses or other authorized safeguards. Document transfers and safeguards.

Example: Brief Policy Summary You Can Use

Here is brief wording you can include in candidate notices or interview invitations:

We employ an AI-enabled platform to gather video responses for this position. We only capture the answers required for recruitment. Your answers will be checked by both humans and the assessment software. You are entitled to request access to your data, rectify inaccuracies, and erase where appropriate. If you are within the EU, you may have further rights in regard to automated decisions.

Adjust the wording to your legal review and to whether you're relying on consent or legitimate interest under GDPR.

Final thoughts

AI interviewing software can speed up and standardize hiring. It also raises genuine privacy and equity issues. In 2025, regulators in the EU and California are clear: businesses must be open, conduct risk assessments, and have humans in the loop when making significant hiring decisions. By following the real-world steps in this guide, startups and recruitment companies will be able to use AI for hiring responsibly.