NYC AI Bias Law Effective July 5th

New York City’s Automated Employment Decisions Tools (AEDT) law, which aims at reducing bias that can occur from using artificial intelligence technology, went into effect July 5. This law makes it unlawful for New York City employers to use an AEDT to screen a candidate, or employee, for employment decisions (including promotion) unless an independent auditor has completed a bias audit within one year of the use of the tool and that information regarding the audit and the AEDT is made public. The bias audit must include calculating the selection or scoring rate for each race/ethnicity, sex, and intersectional categories of sex, ethnicity, and race and determine an impact ratio for each category.

Automated Employment Decision Tools are tools that “substantially assist or replace discretionary decision making”. This has been further explained to mean:

• To rely solely on a simplified output (such as a score, classification or ranking etc..) with no other factors considered, or
• To use a simplified output as one of a set of criteria where the simplified output is weighted more than any other criterion in the set, or
• To use a simplified output to overrule conclusions derived from other factors including human decision-making

This law requires employers to give notice to NYC residing candidates at least 10 business days before the use of an AEDT. Before using an AEDT, employers and employment agencies must also make the following publicly available on the employment section of their website in a “clear and conspicuous manner”:

• The date of the most recent bias audit, the number of individuals the AEDT assessed that fall within an unknown (sex or race/ethnicity) category, the number of applicants or candidates, the selection or scoring rates, as applicable, and the impact ratios for all categories; and,
• The distribution date of the AEDT.

The law also requires employers to provide additional information regarding their AEDT’s data retention policy, the type of data collected for the AEDT, the source of the data, and instructions for how to make a written request for such information.

Employers who use artificial intelligence for employment-related decision-making should discuss this law with their counsel to ensure compliance. Resolution Economics and Berkshire have teamed up to offer AI analysis and validation services. Please reach out to us to find out more!