WHAT THIS BILL REGULATES · 2 REQUIREMENT TYPES
How Is This Bill Enforced
Verbatim statutory text on the left; plain-language analysis and a per-section checklist on the right. Numbered markers cross-link to the matching checklist row.
(1) "Automated decision systemAutomated decision system"Automated decision system" means a system, software, or process that uses computation, the result of which is used to assist or replace human decision-making, including, but not limited to, a system, software, or process derived from machine learning, statistics, or other data processing or artificial intelligence techniques.Labor Law § 750(1)" means a system, software, or process that uses computation, the result of which is used to assist or replace human decision-making, including, but not limited to, a system, software, or process derived from machine learning, statistics, or other data processing or artificial intelligence techniques.
(2) "Algorithmic wage-settingAlgorithmic wage-setting"Algorithmic wage-setting" means using an automated decision system to inform individualized wages based on surveillance data regarding an employee, including but not limited to, the use of real-time data to automate workforce compensation structures, or to automate wage calculations. "Algorithmic wage-setting" shall not include an employer's decision not to hire an individual who has not previously been an employee of such employer directly or through such employer's affiliates or subsidiaries.Labor Law § 750(2)" means using an automated decision systemAutomated decision system"Automated decision system" means a system, software, or process that uses computation, the result of which is used to assist or replace human decision-making, including, but not limited to, a system, software, or process derived from machine learning, statistics, or other data processing or artificial intelligence techniques.Labor Law § 750(1) to inform individualized wages based on surveillance dataSurveillance data"Surveillance data" means data obtained through observation, inference, or surveillance of an employee that is related to personal characteristics, behaviors, or biometrics of such employee, or a group, band, class, or tier in which such employee belongs.Labor Law § 750(3) regarding an employee, including but not limited to, the use of real-time data to automate workforce compensation structures, or to automate wage calculations. "Algorithmic wage-settingAlgorithmic wage-setting"Algorithmic wage-setting" means using an automated decision system to inform individualized wages based on surveillance data regarding an employee, including but not limited to, the use of real-time data to automate workforce compensation structures, or to automate wage calculations. "Algorithmic wage-setting" shall not include an employer's decision not to hire an individual who has not previously been an employee of such employer directly or through such employer's affiliates or subsidiaries.Labor Law § 750(2)" shall not include an employer's decision not to hire an individual who has not previously been an employee of such employer directly or through such employer's affiliates or subsidiaries.
(3) "Surveillance dataSurveillance data"Surveillance data" means data obtained through observation, inference, or surveillance of an employee that is related to personal characteristics, behaviors, or biometrics of such employee, or a group, band, class, or tier in which such employee belongs.Labor Law § 750(3)" means data obtained through observation, inference, or surveillance of an employee that is related to personal characteristics, behaviors, or biometrics of such employee, or a group, band, class, or tier in which such employee belongs.
Section 750 establishes the three core defined terms for this article. Automated decision system is defined broadly to encompass any computational system that assists or replaces human decision-making, including machine learning and AI. Algorithmic wage-setting combines that system definition with the use of surveillance data — data derived from observation, inference, or surveillance of an employee's personal characteristics, behaviors, or biometrics — to set individualized wages. The algorithmic wage-setting definition expressly carves out pre-hire decisions not to hire individuals who have never been employees of the employer.
(1) 1 No employer shall engage in algorithmic wage-settingAlgorithmic wage-setting"Algorithmic wage-setting" means using an automated decision system to inform individualized wages based on surveillance data regarding an employee, including but not limited to, the use of real-time data to automate workforce compensation structures, or to automate wage calculations. "Algorithmic wage-setting" shall not include an employer's decision not to hire an individual who has not previously been an employee of such employer directly or through such employer's affiliates or subsidiaries.Labor Law § 750(2).
(2)(a)–(b) 2 An employer shall be deemed not to have engaged in algorithmic wage-settingAlgorithmic wage-setting"Algorithmic wage-setting" means using an automated decision system to inform individualized wages based on surveillance data regarding an employee, including but not limited to, the use of real-time data to automate workforce compensation structures, or to automate wage calculations. "Algorithmic wage-setting" shall not include an employer's decision not to hire an individual who has not previously been an employee of such employer directly or through such employer's affiliates or subsidiaries.Labor Law § 750(2) otherwise prohibited pursuant to subdivision one of this section if such employer demonstrates that: (a) such employer offers individualized wages based solely on: (i) data specific to individual employees that is directly related to the tasks such employees are hired to perform; or (ii) differences in the cost to the employees of providing labor for such employer; and (b) such employer discloses in plain language before hiring employees to perform work, and to all employees whose wages are set in whole or in part through an automated decision systemAutomated decision system"Automated decision system" means a system, software, or process that uses computation, the result of which is used to assist or replace human decision-making, including, but not limited to, a system, software, or process derived from machine learning, statistics, or other data processing or artificial intelligence techniques.Labor Law § 750(1), what data is considered and how such automated decision systemAutomated decision system"Automated decision system" means a system, software, or process that uses computation, the result of which is used to assist or replace human decision-making, including, but not limited to, a system, software, or process derived from machine learning, statistics, or other data processing or artificial intelligence techniques.Labor Law § 750(1) considers such data.
Section 751 imposes the bill's core prohibition: employers may not engage in algorithmic wage-setting. A safe harbor in subdivision 2 allows employers to use automated decision systems for individualized wages only if two conditions are jointly met — the wages are based solely on task-specific data or cost-of-labor differences, and the employer provides pre-hire and ongoing plain-language disclosure of the data and methodology used. The safe harbor is affirmative-defense structured: the employer bears the burden of demonstrating compliance.
3 Pursuant to procedures as shall be specified by the attorney general, an employer that uses an automated decision systemAutomated decision system"Automated decision system" means a system, software, or process that uses computation, the result of which is used to assist or replace human decision-making, including, but not limited to, a system, software, or process derived from machine learning, statistics, or other data processing or artificial intelligence techniques.Labor Law § 750(1) to assist or replace human decision-making related to wages or prices, as authorized pursuant to subdivision two of section seven hundred fifty-one of this article, shall develop and publish reasonable procedures: 1. to ensure the accuracy of all data considered by such automated decision systemAutomated decision system"Automated decision system" means a system, software, or process that uses computation, the result of which is used to assist or replace human decision-making, including, but not limited to, a system, software, or process derived from machine learning, statistics, or other data processing or artificial intelligence techniques.Labor Law § 750(1); 2. to allow an employee to correct or challenge the accuracy of data considered by such automated decision systemAutomated decision system"Automated decision system" means a system, software, or process that uses computation, the result of which is used to assist or replace human decision-making, including, but not limited to, a system, software, or process derived from machine learning, statistics, or other data processing or artificial intelligence techniques.Labor Law § 750(1); and 3. for employees to request and receive information regarding what data is considered and how automated decision-making considered such data when setting particular wages.
Section 752 imposes procedural obligations on employers operating under the § 751(2) safe harbor. Employers using automated decision systems for wage-setting under the safe harbor must develop and publish procedures — pursuant to specifications from the attorney general — covering three areas: data accuracy assurance, employee correction and challenge rights, and employee transparency about what data is used and how. This section effectively operationalizes the safe harbor by requiring ongoing procedural infrastructure rather than mere one-time disclosure.
The attorney general shall adopt rules and regulations necessary for the implementation of the provisions of this article.
Section 753 grants the attorney general rulemaking authority to implement the article's provisions. This is a standard delegation of regulatory authority and does not itself impose compliance obligations on private parties.
The provisions of this article shall not supersede or invalidate any other laws of this state to the contrary.
Section 754 is a savings clause providing that this article does not supersede or invalidate any other state laws. This preserves all existing labor, privacy, and anti-discrimination protections that may independently apply to algorithmic wage-setting practices.
(1)(a)–(c) An employer who violates any provision of this article shall be liable for a civil penalty not to exceed ten thousand dollars for each violation. A violation with respect to each employee shall constitute a separate violation. (b) Civil penalties collected pursuant to paragraph (a) of this subdivision shall be paid to the general fund of the state. (c) The attorney general may be awarded costs and attorney fees with respect to the prosecution of any violation pursuant to this section.
(2)(a)–(b) In addition to other remedies provided under law, a person aggrieved by a violation of this article may bring a civil action on behalf of themselves or a group of similarly situated persons to restrain further violations and to recover damages, costs, and reasonable attorney fees, including: (a) the greater of: (i) the amount of actual damages sustained, including prejudgment interest of eight percent per year from the date on which the claim accrued; or (ii) three thousand dollars for each violation of this article, with each violation of this article constituting a separate violation with respect to each employee; or (b) if it is established by clear and convincing evidence that the employer violating this article engaged in bad faith conduct or intentionally violated this article, three times the amount of actual damages sustained.
Section 755 establishes the bill's dual enforcement regime. Subdivision 1 authorizes civil penalties of up to $10,000 per violation (with each affected employee constituting a separate violation) and permits the attorney general to recover costs and attorney fees. Subdivision 2 creates a private right of action allowing aggrieved persons to sue individually or on behalf of similarly situated persons, with statutory damages of $3,000 per violation (or actual damages with 8% prejudgment interest, whichever is greater), injunctive relief, and reasonable attorney fees. Treble actual damages are available upon clear and convincing evidence of bad faith or intentional violation.