New York City’s Local Law 144 asks employers to check their hiring tools for bias before putting them to use.
If your company uses automated systems to screen job candidates in NYC, this law probably affects you.
Companies have to run annual bias audits on their automated employment decision tools and share the results with the public. The law also changes how you post job ads and lets candidates know more about how they’re being evaluated.
A lot of employers are still trying to figure out the best way to follow these rules.
Getting it right means knowing what counts as bias detection and setting up the right testing steps.
Key Takeaways
- NYC Local Law 144 makes yearly bias audits a must for automated hiring tools used by employers
- You need to publish audit results and update job posting requirements to fit the law
- Real compliance means understanding detection methods and putting solid testing strategies in place
Understanding Bias Detection Under NYC Local Law 144
The law expects employers to audit their hiring tech for bias against protected groups and let job candidates know these tools are in use.
You have to follow rules about which tools need audits and how to give people notice.
Scope of Automated Employment Decision Tools
Local Law 144 covers tools that help make hiring or promotion decisions automatically.
Think software that screens resumes, ranks candidates, or suggests who should get an interview.
If you use these tools to hire or promote, this law probably applies.
It covers tools that make the final call and those that just give you scores or rankings to help you decide.
Some tools that count:
- Resume screening software
- Video interview analysis programs
- Personality test scoring systems
- Skills assessment ranking tools
You need to audit tools that have a real impact on your hiring choices.
Basically, any system that narrows down or ranks candidates for you.
The law doesn’t cover basic job posting websites or applicant tracking systems that just store info.
Tools that only schedule interviews or send out automated emails don’t count either.
Annual Bias Audit Requirements
Every year, you have to run a bias audit for each automated tool you use.
The audit checks if your tool treats different groups fairly.
A qualified third party must do this audit, not someone from your company or anyone who built the tool.
The audit looks at:
- Selection rates by race and gender
- Impact on different ethnic groups
- Effects on people with disabilities
Auditors calculate how often each group gets picked for interviews or jobs.
If there’s a big difference, it might show bias.
You have to post a summary of the audit results on your website.
This summary should share the selection rates and the testing methods.
The audit uses data from the previous year.
If you don’t have enough real data, you can use test data that matches your usual pool of applicants.
Candidate and Employee Notification Rules
You need to tell job candidates if you’re using automated tools to evaluate them.
Give this notice before you use the tool to make any decisions.
Post the notice right where you list the job opening, somewhere easy to spot.
Your notice needs to say:
- That you use automated tools
- The type of tool and what it evaluates
- How to ask for another selection process
Candidates can ask for different ways to be considered.
You must offer a reasonable alternative within a reasonable timeframe.
Current employees can ask for their individual scores from automated tools.
You need to provide this info within 30 days of their request.
Write the notice in plain language.
Skip technical jargon or complicated explanations about how the tool works.
Best Practices and Compliance Strategies
Companies need to set up reliable audit processes and keep detailed records to meet NYC Local Law 144.
Being open about AI tool usage helps you stay transparent and legal.
Establishing Reliable Audit Processes
You’ve got to run bias detection audits at least once a year before using any AI tool for hiring.
The audit should focus on your specific tool and your own data.
Key Audit Steps:
- Bring in a qualified third-party auditor or an internal team with the right skills
- Check for bias across protected groups (race, gender, age, disability)
- Calculate selection rates and impact ratios for each group
- Document all methods and data sources
Make sure your auditor has enough data to work with.
Small samples can give you unreliable results and might not meet the legal bar.
The audit should use your tool’s current version and settings.
If you make big changes to the tool, you need a new audit within 30 days.
Documentation Must Include:
- Keep all audit reports for at least four years
- Include results of statistical significance testing
- Record any steps you took to fix bias
- Track who handled the data and when
Documenting and Disclosing AI Tool Use
Post a bias audit summary on your website at least 10 business days before you use the AI tool.
Leave it up as long as you’re using the tool.
What to Disclose:
- Selection rates by race, ethnicity, and gender
- Impact ratios for each protected group
- Date the audit finished
- Date you posted the summary
Your job postings should say you use AI tools in hiring.
Name the types of tools and what parts of the process they affect.
Keep Internal Records:
- Note which candidates went through AI screening
- Log AI tool settings and changes
- Record any times humans overruled the AI
- Track when and why you used each tool
Write up policies for how employees should use AI hiring tools.
Include training and who needs to approve new AI tools.
Frequently Asked Questions
NYC Local Law 144 sets out rules for bias audits and automated employment decision tools.
The law spells out deadlines, penalties, and steps that affect both employers and people looking for jobs.
What are the requirements for conducting a bias audit under NYC Local Law 144?
You need to hire an independent auditor for the bias audit.
The auditor can’t be your employee or someone who helped make the tool.
The audit checks for bias based on race, ethnicity, and sex.
You have to calculate selection rates and impact ratios for each group.
Auditors use historical data from the tool’s real-world use.
If you’re short on actual data, you can use test data that matches your expected applicants.
Finish the audit within a year before you use the tool.
Post a summary of the audit results on your website.
How does Local Law 144 of 2021 impact the use of automated employment decision tools in New York City?
You can’t use automated employment decision tools for hiring or promotion in NYC unless you have a current bias audit.
This rule covers tools that screen resumes, score candidates, or rank applicants.
You have to post notice at least 10 business days before using the tool.
Put the notice in the same spot as your job posting.
Applicants who ask for it must get alternative selection processes.
This gives people another way to be considered if they don’t want the automated tool to judge them.
The law covers both employees and job seekers.
It applies to jobs performed in New York City.
What are the penalties for non-compliance with the AI bias detection regulations established by Local Law 144?
The NYC Commission on Human Rights can fine you up to $1,500 for each violation.
Every day you don’t fix the issue counts as a separate violation.
You could face extra penalties of up to $850 per day if you keep breaking the rules.
These daily fines can add up fast if you don’t address compliance issues.
The Commission might order you to stop using tools that don’t follow the law.
You may need to change your hiring processes until you’re back on track.
People can also sue under the law’s private right of action if they’re harmed by violations.
How do individuals opt out of automated employment decision tools, as permitted by NYC’s Local Law 144?
You can ask for another selection process instead of the automated tool.
If your request is reasonable, the employer has to offer a different way to evaluate you.
You can also ask for reasonable accommodations during the process.
This includes changes that help you take part in hiring or promotion decisions.
Employers must share these options in their notice.
They can’t retaliate against you for making a request.
Make your request soon after getting the notice about the automated tool.
The employer should respond quickly.
In what ways does Local Law 144 intersect with existing anti-discrimination laws in NYC?
Local Law 144 works together with the NYC Human Rights Law.
Both aim to stop discrimination in hiring.
Bias audit requirements help employers spot problems that could break anti-discrimination laws.
Finding bias early can keep you out of legal trouble.
The NYC Commission on Human Rights enforces both laws.
They can look into complaints about automated tools and regular discrimination.
Your duties under fair employment laws still apply.
Local Law 144 adds new steps but doesn’t replace other protections.
What are the key deadlines and implementation dates for Local Law 144’s bias audit requirements?
The law started on July 5, 2023.
If you use automated employment decision tools in NYC, you have to follow all the requirements.
You need to finish your bias audit within a year before you use the tool.
If the audit is over 12 months old, you can’t use that tool.
Post the required notices at least 10 business days before you use any automated tools.
This goes for each job posting or promotion you offer.
Put audit summaries on your website before you start using the tools.
Keep those summaries up as long as you’re still using the automated systems.