Artificial Intelligence seems to be everywhere these days. As we wrote last month, generative AI tools are rapidly becoming a workplace temptation for employees seeking to streamline their job duties. Similarly, AI has taken on a role in recruiting and hiring at many companies, which has drawn scrutiny from the EEOC, as well as state and local regulators concerned about the potentially discriminatory effect of AI-driven Automated Employment Decision Tools (AEDT). One important example is New York City, whose AEDT Law became effective January 1, 2023. The NYC law bans employers from using AI tools unless, among other things, they have first submitted to an independent audit bias within a year of use. NYC will begin enforcing the AEDT Law on July 5.

While employers have a wide variety of computer-based AEDT available to assist them in hiring decisions, monitoring worker performance, determining pay or promotions, and establishing the terms and conditions of employment, potentially saving significant time and effort, use of AEDT may unintentionally disadvantage job applicants and employees based on their protected characteristics. This is a reminder that employers need to carefully implement AI tools to ensure they do not violate equal employment laws.

What is AEDT Exactly?

AEDT is defined under the NYC law as any tool that applies artificial intelligence to “substantially assist or replace discretionary decision making” of an employer, such that it does any of the...

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