[co-author: Ardie Ermac]*
New York City has issued the first guidance related to its new "AI audit" law that will require employers and employment agencies to conduct bias audits of automated decision-making technologies used to evaluate job candidates or employees. Although the law will take effect January 1, 2023, there are still many unanswered questions about how the law will be interpreted and applied.
At least one of those questions has been answered by The Department of Consumer and Worker Protection's (DCWP) publication of new rules expanding on how the agency will apply statutory penalties for violations of the new law. Pursuant to § 6-81 "Automated Employment Decision Tools Penalty Schedule," each day an employer uses an automated employment decision tool in violation of N.Y.C. Admin Code § 20-871(a) counts as a separate violation. Additionally, an employer's failure to provide notice to a candidate or employee in violation of N.Y.C. Admin Code § 20-871(b) constitutes a separate (also daily) violation. Further, the DCWP rules make clear that the agency will view potential violations quite broadly, explaining that unless otherwise specified, "the penalties set forth for each section of law or rule shall also apply to all subdivisions, paragraphs, subparagraphs, clauses, items or any other provision contained therein."
The following is the penalty schedule promulgated by DCWP.
| Citation | Violation Description | First Violation | First Default | Second Violation | ... |
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