Employers in New York City will face new regulations on using artificial intelligence in hiring decisions starting this week.
The city will begin enforcing Local Law 144 on Wednesday, a law banning employers from using automated employment decision tools unless the technology is audited annually for bias and they inform applicants of the screening tool.
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The law will be the first city-based AI restriction enacted within the United States and could set the standards for how other cities and states set guardrails for the practice.
The technology is fairly common, according to some local lawyers.
“More than half of all private employers are already using artificial intelligence in one form or another in recruiting and hiring,” Nicholas Pappas, a New York-based labor and employment lawyer at Dorsey & Whitney, told the Washington Examiner in a statement.
The affected tools are numerous, including resume scanners that search for keywords, chatbots used for virtual interviews, knowledge tests, and an assortment of other elements that may be used to determine if a subject is an ideal candidate.
The law extends well beyond New York’s borders. Pappas noted that the law applies to “not only workers located in New York City but also to applicants located outside of New York City for jobs to be performed in New York City.”
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The federal government is quickly moving to figure out how to set up guardrails to ensure that AI is reined in. Senate Majority Leader Chuck Schumer (D-NY) announced a new five-point framework for writing AI-related laws in June, set up an AI briefing for senators, and will host forums to ensure the legislative branch properly understands AI. Reps. Ted Lieu (D-CA) and Ken Buck (R-CO) introduced legislation to form a commission on AI.
The National Institute of Standards and Technology also launched a working group to understand the legal and regulatory problems that software such as ChatGPT presents.
