Laws & Statutes › NY › NY-A-05429
A-05429
NY · State · USA
NY
USA
● Pending
Proposed Effective Date
2025-01-01
New York Assembly Bill 5429-A — New York Workforce Stabilization Act
Requires New York employers with more than 100 employees (excluding small businesses) to conduct artificial intelligence impact assessments before implementing AI systems, covering system objectives, algorithms, training data, personal data use, and estimates of employee displacement. Impact assessments must be submitted to the Department of Labor at least 30 days before AI implementation and updated at least every two years or upon material changes. Separately imposes a 2% surcharge on a corporation's business income base if the corporation displaces at or above a threshold number of employees through AI or automation, or if the corporation uses AI for data mining. Surcharge revenues are directed to worker retraining, workforce development, and the unemployment insurance fund.
Passage Likelihood
Low
Chamber No passage
Committee No action
Majority party Yes
Bipartisan No
Prior session None
Legislative History
2025-02-14 committee referral referred to labor
2025-06-02 amend (t) and recommit to labor amend (t) and recommit to labor
2025-06-02 print number 5429a print number 5429a
2026-01-07 committee referral referred to labor
Mapped Requirements
H-02 Non-Discrimination & Bias Assessment R-02 Regulatory Disclosure & Submissions
Official Sources
Full Text ↗
Entry Last Reviewed
2026-04-02
AI generated
Summary

Requires New York employers with more than 100 employees (excluding small businesses) to conduct artificial intelligence impact assessments before implementing AI systems, covering system objectives, algorithms, training data, personal data use, and estimates of employee displacement. Impact assessments must be submitted to the Department of Labor at least 30 days before AI implementation and updated at least every two years or upon material changes. Separately imposes a 2% surcharge on a corporation's business income base if the corporation displaces at or above a threshold number of employees through AI or automation, or if the corporation uses AI for data mining. Surcharge revenues are directed to worker retraining, workforce development, and the unemployment insurance fund.

Enforcement & Penalties
Enforcement Authority
The Department of Labor receives and reviews impact assessments submitted by employers. The Tax Commissioner administers and collects surcharges under Tax Law § 186-h in the same manner as taxes imposed by Article 28 of the Tax Law. No private right of action is created. Enforcement is agency-initiated through the Department of Labor for impact assessment compliance and through the Department of Taxation and Finance for surcharge collection.
Penalties
The bill does not specify civil penalties for failure to conduct or submit impact assessments. Surcharges imposed under Tax Law § 186-h are set at 2% of the corporation's business income base. All provisions of Article 28 of the Tax Law, including those relating to collection and personal liability, apply to the surcharges. No damages framework or penalty schedule is specified for violations of the impact assessment requirement.
Who Is Covered
"Employer" means a business that: (i) is resident in the state, (ii) is not a small business, and (iii) employs more than one hundred people.
"Small business" means a business that: (i) is resident in the state, (ii) is independently owned and operated, (iii) is not dominant in its field, and (iv) employs one hundred or less people.
Compliance Obligations 7 obligations · click obligation ID to open requirement page
H-02 Non-Discrimination & Bias Assessment · H-02.3 · Deployer · Automated DecisionmakingEmployment
Labor Law § 201-j(1)(a)-(d)
Plain Language
Before implementing any AI system, covered employers must conduct and complete an impact assessment covering the system's objectives, its ability to achieve those objectives, a summary of its algorithms and computational tools, the training data used in its development, and how it handles sensitive and personal data. Assessments must be repeated at least every two years and whenever a material change to the AI system could alter its outcomes or effects. This obligation applies to New York-resident businesses with more than 100 employees that are not independently owned small businesses. The assessment covers the technical design and data governance aspects of the AI system but also extends to workforce displacement estimates (mapped separately).
Statutory Text
No employer shall utilize or apply any artificial intelligence unless the employer, or an entity acting on behalf of such employer, shall have conducted an impact assessment for the application and use of such artificial intelligence. Following the first impact assessment, an impact assessment shall be conducted at least once every two years. An impact assessment shall be conducted prior to any material change to the artificial intelligence that may change the outcome or effect of such system. Such impact assessments shall include: (a) a description of the objectives of the artificial intelligence; (b) an evaluation of the ability of the artificial intelligence to achieve its stated objectives; (c) a description and evaluation of the objectives and development of the artificial intelligence including: (i) a summary of the underlying algorithms, computational modes, and tools that are used within the artificial intelligence; and (ii) the design and training data used to develop the artificial intelligence process; (d) the extent to which the deployment and use of the artificial intelligence requires input of sensitive and personal data, how that data is used and stored, and any control users may have over their data;
Other · Deployer · Automated DecisionmakingEmployment
Labor Law § 201-j(1)(e)-(f)
Plain Language
As part of the required impact assessment, employers must include an estimate of how many employees have already been displaced by the AI system and how many are expected to be displaced or otherwise affected by increased AI use. This is a forward- and backward-looking workforce impact analysis that must be updated with each assessment cycle (every two years or upon material change). The obligation requires employers to affirmatively quantify AI's labor impact, not merely acknowledge it in general terms.
Statutory Text
(e) an estimate of the number of employees already displaced due to artificial intelligence; and (f) an estimate of the number of employees expected to be displaced or otherwise affected due to the increased use of artificial intelligence in the workplace.
R-02 Regulatory Disclosure & Submissions · R-02.1 · Deployer · Automated DecisionmakingEmployment
Labor Law § 201-j(2)
Plain Language
Employers must submit completed AI impact assessments to the Department of Labor at least 30 days before deploying the AI system that is the subject of the assessment. This is a proactive pre-deployment submission requirement — employers cannot wait to be asked. The 30-day lead time creates a mandatory waiting period between submission and implementation, though the statute does not expressly grant the Department authority to block implementation based on the assessment's contents.
Statutory Text
Any impact assessment conducted pursuant to this subdivision shall be submitted to the department at least thirty days prior to the implementation of the artificial intelligence that is the subject of such assessment.
Other · Deployer · Automated DecisionmakingEmployment
Tax Law § 186-h(1)(a)-(b)
Plain Language
Corporations that terminate or substantially reduce hours for at least a threshold number of employees due to AI or automation systems must pay an annual surcharge of 2% of their business income base. The threshold varies by employer size: 25+ employees for employers with 100–250 employees, 50+ for 251–500, 100+ for 501–1,000, and 250+ for 1,001+. The surcharge must be reported and paid to the Tax Commissioner at least annually. This is not a compliance obligation in the traditional AI governance sense — it is a fiscal mechanism to fund worker retraining programs.
Statutory Text
(a) A surcharge on corporations that terminate the employment or substantially reduce the hours of at least the threshold number of employees pursuant to this subdivision due to any system or process that uses algorithms, computational models, artificial intelligence techniques, robotic hardware, or a combination thereof, to automate, support, or replace human labor is imposed at the rate of two percent of the corporation's business income base. The threshold number of employees shall be: (i) for employers with between one hundred and two hundred fifty employees, twenty-five or more employees; (ii) for employers with between two hundred fifty-one and five hundred employees, fifty or more employees; (iii) for employers with between five hundred one and one thousand employees, one hundred or more employees; and (iv) for employers with one thousand one or more employees, two hundred fifty or more employees. (b) The surcharge shall be reported and paid to the commissioner no less frequently than on an annual basis. The payments shall be accompanied by a return in the form and containing the information the commissioner may prescribe.
Other · Government · Automated DecisionmakingEmployment
Tax Law § 186-h(1)(c)-(d)
Plain Language
The Tax Commissioner, in consultation with the Department of Labor, may waive the worker displacement surcharge for eligible corporations — those experiencing or anticipating labor shortages, agricultural businesses needing AI to protect commodity production, or small businesses needing AI to remain economically viable. The Department of Labor must annually report to the legislature on waivers granted, including the justification for each, and publish the report on its website. For corporations, this creates an available application-based safe harbor from the surcharge. For the Department of Labor, this creates an annual legislative reporting obligation. Neither constitutes a traditional AI compliance obligation.
Statutory Text
(c) The commissioner, in consultation with the department of labor, may waive the surcharge set forth by paragraph (a) of this subdivision for an eligible corporation. The commissioner, in consultation with the department of labor, shall establish a process whereby eligible corporations may apply to have the surcharge waived. For the purposes of this section, an eligible corporation shall be: (i) A business that is found by the department of labor to be experiencing or anticipating a labor shortage; (ii) A business that demonstrates that it requires the use of algorithms, computational models, artificial intelligence techniques, robotic hardware, or a combination thereof, to protect or improve the production of agricultural commodities within the state; or (iii) A small business, as defined by section one hundred thirty-one of the economic development law, that demonstrates that it requires the use of algorithms, computational models, artificial intelligence techniques, robotic hardware, or a combination thereof, to remain economically viable. (d) The department of labor shall annually report to the legislature on the number of waivers that it has granted pursuant to paragraph (c) of this subdivision, in the preceding year and the justification for why each waiver was granted. Such report shall be sent to the temporary president of the senate, the minority leader of the senate, the speaker of the assembly, and the minority leader of the assembly and shall be made available to the public on the website of the department.
Other · Deployer · Automated DecisionmakingEmployment
Tax Law § 186-h(2)(a)-(b)
Plain Language
Corporations that use AI for data mining — defined extremely broadly as any pattern-based queries, searches, or analyses of electronic databases — must pay an annual surcharge of 2% of their business income base. The definition of data mining is remarkably expansive and could encompass virtually any use of AI that involves querying or analyzing data in electronic form. This is a fiscal mechanism rather than a compliance obligation in the traditional AI governance sense.
Statutory Text
(a) A surcharge on corporations that use artificial intelligence for data mining is imposed at the rate of two percent of the corporation's business income base. For the purposes of this subdivision, the term "data mining" shall mean a process involving pattern-based queries, searches, or other analyses of one or more electronic databases. (b) The surcharge shall be reported and paid to the commissioner no less frequently than on an annual basis. Surcharge payments shall be accompanied by a return in the form and containing the information the commissioner may prescribe.
Other · Government · Automated DecisionmakingEmployment
Tax Law § 186-h(3)-(4)
Plain Language
This provision establishes the administrative framework for collecting the AI surcharges and directs how revenues are allocated. Surcharges are collected using the same mechanisms as Article 28 sales taxes, with limited exemption carve-outs. All revenues are deposited separately and paid to the Department of Labor for worker retraining programs, workforce development programs, or the unemployment insurance fund. This creates no new compliance obligation for regulated entities beyond the surcharge payment obligations already mapped — it is a fiscal administration provision.
Statutory Text
3. Applicable provisions. (a) Except as otherwise provided in this section, the surcharges imposed under this section shall be administered and collected by the commissioner in a like manner as the taxes imposed by article twenty-eight of this chapter. All the provisions of article twenty-eight of this chapter, including the provisions relating to definitions, exemptions, returns, personal liability for the tax, collection of tax from the customer, payment of tax, and the administration of the taxes imposed by such article, shall apply to the surcharges imposed under the authority of this section so far as those provisions can be made applicable to the surcharges imposed by this section, with such modifications as may be necessary in order to adapt the language of those provisions to the surcharges imposed by this section. Those provisions shall apply with the same force and effect as if the language of those provisions had been set forth in full in this section, except to the extent that any of those provisions is either inconsistent with a provision of this section or is not relevant to the surcharge imposed by this section. For purposes of this section, any reference in this chapter to a tax or the taxes imposed by article twenty-eight of this chapter shall be deemed also to refer to the surcharges imposed by this section unless a different meaning is clearly required. (b) Notwithstanding the provisions of paragraph (a) of this subdivision: (1) the exemptions provided for in section eleven hundred sixteen of this chapter, other than the exemptions in paragraphs one, two and three of subdivision (a) of such section, shall not apply to the surcharges imposed by this section. (2) the credit provided in subdivision (f) of section eleven hundred thirty-seven of this chapter shall not apply to this section. 4. Deposits of surcharge monies collected and received. Notwithstanding any provision of law to the contrary, all surcharge monies collected and received by the commissioner under this section shall be deposited daily to the credit of the comptroller with those responsible banks, banking houses or trust companies the comptroller may designate. Those deposits shall be kept separate and apart from all other monies in the possession of the comptroller. The comptroller shall require adequate security from all such depositories. All surcharge monies collected and received under this section shall be paid to the department of labor to be used, in a manner prescribed by the commissioner of the department of labor, for worker retraining programs administered by the department, workforce development programs administered by the department or to be paid to the unemployment insurance fund.