On July 5, 2023, New York City is poised to begin enforcement of a law initially passed in 2021 that requires employers to take certain steps before implementing an automated employment decision tool (AEDT). The law reflects a growing focus on the use of artificial intelligence (AI) in employment decisions and addresses concerns pertaining to the use of AI, including that biased algorithms could create a disparate impact on certain candidates or employees, even without an employer's intent to discriminate.

NYC 144 Requirements

As previously detailed here, NYC Local Law 144 of 2021 (NYC 144) prohibits employers and employment agencies from using an AEDT to make a hiring or promotion decision unless they conduct a bias audit on the tool annually, publish an audit summary, and provide certain notice to candidates and employees about the tool. New York City previously deferred enforcement of the law pending final regulations, which were published on April 5, 2023, and the law will become effective July 5, 2023. These regulations provide further insight into what the law covers and how an employer should conduct a bias audit.

The New York City law applies to an employer's or employment agency's use of an AEDT to screen candidates for hiring or employees for promotion. The law does not cover other employment decisions, such as compensation, retention, and termination decisions. In the context of hiring, the law applies with respect to tools used to screen candidates who have ...

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