As we previously reported, New York City passed legislation that protects individuals from unlawful bias by the employer when automated employment decision tools are used. Pursuant to the law, employers must conduct AI tool audits to confirm that such tools are not biased. The results of those audits must be published on publicly-available websites. Furthermore, the employer is required to disclose the data that the AI tool collects either by disclosing it publicly or in a response to an inquiry. The new law will go into effect on January 1, 2023.
Recently, New York City has proposed rules for implementing this new law. The proposed rules would clarify the requirements for the use of automated employment decision tools within New York City, the notices to employees and candidates for employment regarding the use of the tool, the bias audit for the tool, and the required published results of the bias audit.
Specifically, the proposed rules provide the following:
- Clarify that the AI Law applies only when AEDT simplified output (such as a score, tag, classification, or ranking) is (1) the sole criteria relied upon, without considering other factors, (2) given more weight than any other criteria, or (3) used to overrule or modify conclusions derived from other factors, such as human decision making.
- Set forth minimum required elements for a bias audit, including (1) calculation of the selection rate for each race/ethnicity and a sex category; and (2) comparison of such “selection rates” to the most selected category to determine an “impact ratio” using a defined formula.
- Confirm that the prospective notice requirement to candidates and employees residing in New York City regarding the use of AEDTs can be met by clear and conspicuous writing on the employer website, job posting, or via US mail or email at least 10 business days prior to the use of the AEDT.
- Confirm that employers can meet the requirement to publish the distribution date of the AEDT, the date of the most recent bias audit and a summary of the results if they include a clear and conspicuous link to a website containing this information on the careers or job sections of their website. Employers must keep the summary of results and distribution date posted for at least six months after last using the audit tool.
- Define the following key terms that were not defined in the statute:
- “Screen” means “to make a determination about whether someone should be selected or advanced in the hiring or promotion process.”
- “Selection rate” means “the rate at which individuals in a category are either selected to move forward in the hiring process or assigned a classification by an AEDT. Such rate may be calculated by dividing the number of individuals in the category moving forward or assigned a classification by the total number of individuals in the category who applied for a position or were considered for promotion.”
- “Impact ratio” means “either (i) the selection rate for a category divided by the “selection rate of the most selected category or (ii) the average score of all individuals in a category divided by the average score of individuals in the highest scoring category.”
The proposed rules also indicate that covered employers must keep a summary of the audit results and distribution date posted for at least six months after last using the AEDT for an employment decision.
A public hearing will be held on the Proposed Rules on October 24, 2022. Prior to the hearing, any individual or group may submit comments on the Proposed Rules. While the proposed rules are subject to amendment, it is unlikely they will change significantly.
Employers should begin to prepare now, as the audits can take weeks or months to complete and they must have completed audits and published their results by January 1, 2023. We will continue to monitor developments regarding this new law. Should you have any questions or need assistance with the audit process, Ali Law Group is here to help.