Postponement of NYC Law Regulating Use of AI in Employment Decisions
Summary
On April 6, 2023, the New York City Department of Consumer and Worker Protection (DCWP) announced that enforcement of the impending law regulating the use of automation and AI in employment decisions was postponed for a second time. The final rule will go into effect on May 6, 2023, and DCWP will begin enforcement on July 5, 2023. The law prohibits employers and employment agencies from using an automated employment decision tool, unless the tool has been subject to a bias audit within one year of use. The New York City Department of Consumer and Worker Protection Rules are amended to add a chapter on automated employment decision tools (AEDT). An employer or employment agency may not use or continue to use AEDT if more than one year has passed since its most recent bias audit. Where an AEDT selects candidates for employment or employees being considered for promotion to move forward in the hiring process or classifies them into groups, a bias audit must complete certain steps, including calculate the selection rate and impact ratio for each category. Where an AEDT scores candidates for employment or employees being considered for promotion, a bias audit must complete certain steps, including calculate the median score for the full sample of applicants and calculate the scoring rate and impact ratio in each category. A bias audit must use historical data of the AEDT, but an employer or employment agency can rely on a bias audit that uses test data if insufficient historical data is available to conduct a statistically significant bias audit. Before the use of an AEDT, an employer or employment agency in the city must make publicly available on the employment section of their website the date of the most recent bias audit of the AEDT and a summary of the results and the distribution date of the AEDT. The required notice to candidates and employees must include instructions for how an individual can request an alternative selection process or a reasonable accommodation under other laws, if available. The employer or employment is not required to provide an alternative selection process. Notice to a candidate can be provided through the employment section of the website, job posting, US mail, or e-mail at least 10 business days before using an AEDT. Notice to an employee being considered for promotion can be provided through a written policy or procedure, job posting, US mail, or e-mail at least 10 business days before use of an AEDT.
