Regulon — City+of+NY+-+Local+Law+144+of+2021 · NYC Local Law 144 (Automated Employment Decision Tools)

Summary

NYC Local Law 144 of 2021 prohibits employers and employment agencies in New York City from using automated employment decision tools (AEDTs) to screen candidates for employment or employees for promotion unless the tool has undergone an independent bias audit within the prior year and a summary of the audit results has been publicly posted. Employers must also provide at least 10 business days' advance notice to NYC-resident candidates or employees that an AEDT will be used, disclose the job qualifications and characteristics the tool will assess, and make data collection and retention information available upon written request. The DCWP final rules (6 RCNY Subchapter T) detail the bias audit methodology — requiring calculation of selection rates, scoring rates, and impact ratios across sex, race/ethnicity, and intersectional categories using EEO-1 Component 1 categories — and specify data requirements, independence standards for auditors, and permissible notice methods. Enforcement is by DCWP through civil penalties up to $1,500 per violation, with each day of non-compliant AEDT use and each failure to notify constituting separate violations.

Enforcement & Penalties

Enforcement Authority

The NYC Department of Consumer and Worker Protection (DCWP) enforces the law. The corporation counsel or designees on behalf of the department may initiate any action or proceeding in any court of competent jurisdiction for correction of violations, including mandating compliance. Civil penalty proceedings are returnable to the Office of Administrative Trials and Hearings (OATH) or any designated city agency. Enforcement began July 5, 2023. The law does not create a private right of action for violations of this subchapter, though § 20-874 preserves existing rights of candidates or employees to bring civil actions and preserves the authority of the Commission on Human Rights to enforce Title 8.

Penalties

Civil penalty of not more than $500 for a first violation and each additional violation occurring on the same day as the first violation, and not less than $500 nor more than $1,500 for each subsequent violation. Each day of unlawful AEDT use constitutes a separate violation. Failure to provide any required notice to each candidate or employee constitutes a separate violation. Per the penalty schedule, first violations carry $375 (or $500 default), second violations carry $1,350 (or $1,500 default), and third and subsequent violations carry $1,500. The corporation counsel may also seek injunctive relief or other appropriate relief.

Who Is Covered

What Is Covered

"Automated employment decision tool" means any computational process, derived from machine learning, statistical modeling, data analytics, or artificial intelligence, that issues simplified output, including a score, classification, or recommendation, that is used to substantially assist or replace discretionary decision making for making employment decisions that impact natural persons. The term "automated employment decision tool" does not include a tool that does not automate, support, substantially assist or replace discretionary decision-making processes and that does not materially impact natural persons, including, but not limited to, a junk email filter, firewall, antivirus software, calculator, spreadsheet, database, data set, or other compilation of data.

Compliance Obligations 4 obligations · click obligation ID to open requirement page

H-02 Non-Discrimination & Bias Assessment · H-02.6 H-02.7 · Deployer · EmploymentAutomated Decisionmaking

N.Y.C. Admin. Code § 20-871(a)(1)-(2)

Plain Language

Employers and employment agencies in NYC may not use an AEDT to screen candidates for hiring or employees for promotion unless two conditions are met: (1) the tool has undergone an independent bias audit within the preceding year, and (2) a summary of the audit results and the distribution date of the tool have been posted on the employer's or employment agency's website before the tool is used. The bias audit must assess disparate impact across EEO-1 race/ethnicity and sex categories. The summary must remain posted for at least 6 months after the last use of the AEDT. This creates both a mandatory independent audit obligation and a public disclosure obligation as preconditions to lawful AEDT use.

Statutory Text

In the city, it shall be unlawful for an employer or an employment agency to use an automated employment decision tool to screen a candidate or employee for an employment decision unless: 1. Such tool has been the subject of a bias audit conducted no more than one year prior to the use of such tool; and 2. A summary of the results of the most recent bias audit of such tool as well as the distribution date of the tool to which such audit applies has been made publicly available on the website of the employer or employment agency prior to the use of such tool.

H-01 Human Oversight of Automated Decisions · H-01.3 · Deployer · EmploymentAutomated Decisionmaking

N.Y.C. Admin. Code § 20-871(b)(1)-(2)

Plain Language

Employers and employment agencies must notify each NYC-resident candidate or employee at least 10 business days before using an AEDT that: (1) an AEDT will be used in the assessment or evaluation, with instructions for requesting an alternative selection process or reasonable accommodation; and (2) the specific job qualifications and characteristics the AEDT will evaluate. Per the implementing rules, notice may be provided on the employment section of the employer's website, in a job posting, or by U.S. mail or email. The notice must include instructions for how to request an alternative process or accommodation, though the law does not require employers to actually provide an alternative process.

Statutory Text

In the city, any employer or employment agency that uses an automated employment decision tool to screen an employee or a candidate who has applied for a position for an employment decision shall notify each such employee or candidate who resides in the city of the following: 1. That an automated employment decision tool will be used in connection with the assessment or evaluation of such employee or candidate that resides in the city. Such notice shall be made no less than ten business days before such use and allow a candidate to request an alternative selection process or accommodation; 2. The job qualifications and characteristics that such automated employment decision tool will use in the assessment of such candidate or employee. Such notice shall be made no less than 10 business days before such use;

D-01 Automated Processing Rights & Data Controls · D-01.1 · Deployer · EmploymentAutomated Decisionmaking

N.Y.C. Admin. Code § 20-871(b)(3)

Plain Language

Employers and employment agencies must make available to NYC-resident candidates and employees, upon written request, information about the type of data collected by the AEDT, the source of that data, and the employer's data retention policy. This information must be provided within 30 days of a written request. Per the implementing rules, employers may satisfy this by posting the information on the employment section of their website along with instructions for how to make a written request. A carve-out applies where disclosure would violate local, state, or federal law or interfere with a law enforcement investigation — in that case, the employer must explain why disclosure cannot be made.

Statutory Text

3. If not disclosed on the employer or employment agency's website, information about the type of data collected for the automated employment decision tool, the source of such data and the employer or employment agency's data retention policy shall be available upon written request by a candidate or employee. Such information shall be provided within 30 days of the written request. Information pursuant to this section shall not be disclosed where such disclosure would violate local, state, or federal law, or interfere with a law enforcement investigation.

Other · EmploymentAutomated Decisionmaking

N.Y.C. Admin. Code § 20-874

Plain Language

This savings clause confirms that Local Law 144 does not limit existing rights of candidates or employees to bring civil actions under other laws, nor does it limit the NYC Commission on Human Rights' authority to enforce anti-discrimination provisions under Title 8. It creates no new compliance obligation.

Statutory Text

The provisions of this subchapter shall not be construed to limit any right of any candidate or employee for an employment decision to bring a civil action in any court of competent jurisdiction, or to limit the authority of the commission on human rights to enforce the provisions of title 8, in accordance with law.