Lay of the land – regulations around automated and AI hiring to monitor

• Impacts companies hiring in NYC (whether based in NYC or not) that use a range of common HR tools for resume sorting, assessments, and interviewing
• Requires independent, third-party audit of certain systems for racial and gender bias
• Enforcement begins on July 5, 2023
• Fines are up to $3,000 per day per violation (large companies will likely have several violations) 
• Learn more

This is a NY statewide analogue to NYC Local Law 144. This bill has been referred to committee and is in its early stages. The current draft is likely to change but currently key provisions are: 

• Requires disparate impact assessments provided by the vendor to employers
• Employers in turn must make the assessment available to candidates and file the results with the state
• Helpfully, the bill identifies the following list of technologies likely to be covered: “personality tests, cognitive ability tests, resume scoring systems and any system whose function is governed by statistical theory, or whose parameters are defined by such systems…”

• In 2021, EEOC launched its Artificial Intelligence and Algorithmic Fairness Initiative
• EEOC’s 2023 enforcement plan lists AI hiring bias as one of its top 3 priorities for regulation
• Additional federal legislation is likely in late 2023 or early 2024

AB 331 has passed committee in the California Assembly and is undergoing public comment. The bill as currently written will go into effect on January 1, 2025. Key provisions include:

• Impact assessments to be submitted proactively to the state by both automated tool vendors and employers who use the tools
• List of protected classes is substantially larger than in the NYC law, including religion, sexual orientation, disability, and veteran status
• Substantial proactive notification requirements regarding the use of automated tools on employees and job candidates
• Private right of action — expect substantial litigation

• Like NYC Local Law 144, requires independent bias audits of automated hiring tools
• Puts compliance burden on the vendor — the vendor must offer the audit as part of its service at no additional cost, and may not offer an automated tool for sale without the audit
• Status: This regulation has passed committee on a vote of 8-1 and referred back to the assembly

Last hearing 09/20/2022
Advancement could happen Q1 2023

Requires organizations using algorithms in hiring:

• Audit algorithms for discriminatory patterns
• Report results and any corrective actions
• Disclose and explain when algorithms negatively impact consumers’ outcomes