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December Guidance on New York AEDT Law (Local Law 144)

On December 23rd, NYC DCWP, the agency responsible for implementing the New York AEDT Law, released additional guidance. This guidance was in response to public commentary last November.

A new round of public commentary is scheduled for late January; we can be sure that there will be additional edits to the guidance.

Overall, DCWP seems to be using the public commentary process to make the law more restrictive rather than less. There was not, for example, a small business carve-out or other language to make compliance more streamlined.

Here is a rundown of the biggest changes in the revised guidance.

Definition of internal auditor

The guidance clarifies that an auditor does not qualify as independent if any of the following apply. Quoting from the guidance:

is or was involved in using, developing, or distributing the AEDT
at any point during the bias audit, has an employment relationship with an employer or employment agency that seeks to use or continue to use the AEDT or with a vendor that developed or distributes the AEDT; or
at any point during the bias audit, has a direct financial interest or a material indirect financial interest in an employer or employment agency that seeks to use or continue to use the AEDT in a vendor that developed or distributed the AEDT.

This clarifies any ambiguity as to whether the AEDT vendor can supply or commission the audit, or whether the auditor can be internal at the company. A true third party auditor will be required.

Data requirements

The guidance now includes specifications on the use of historical vs. test data.

If historical data exists, it must be used
If historical data is not available, test data may be run through the AEDT
Employers can rely on historical data and/or test data from other organizations

That final provision re-introduces some ambiguity, as it’s not clear whether an AEDT vendor may supply test data to multiple organizations. (It seems unlikely that companies will provide live historical hiring data to each other given privacy requirements).

Remaining ambiguity in alternative accommodations

Remaining ambiguity in alternative accomodations

One of the areas we believed NYC would clarify has to do with providing alternative accommodations. The previous guidance made clear that employers must give notice that candidates can request alternative accommodations (that don’t rely on AEDT). However, mere words later, the guidance makes clear that an employer does not actually have to provide an alternative process. As of now, we will certainly advise clients to prepare some kind of alternative process, as this ambiguity should hopefully be resolved.

John Rood

John is a sought-after expert on emerging compliance issues related to AI in hiring and HR. He has spoken at the national SHRM conference, and his writing has appeared in HR Brew, Tech Target, and other publications. Prior to Proceptual, John was founder at Next Step Test Preparation, which became a leader in the pre-medical test preparation industry before selling to private equity. He lives in the Chicago area and is a graduate of Michigan State University and the University of Chicago.