New York City Local Law 144 requires any employer or staffing agency that uses an automated employment decision tool (AEDT) to screen NYC candidates or employees for hiring or promotion to have that tool independently audited for bias within the past year, post a summary of the audit results on its website, and give affected individuals at least 10 business days’ notice before the tool is used.1Department of Consumer and Worker Protection. Automated Employment Decision Tools (AEDT) The law took effect January 1, 2023, with active enforcement by the Department of Consumer and Worker Protection (DCWP) starting July 5, 2023.
Who and What the Law Covers
The trigger is the candidate’s or employee’s location, not the employer’s. If someone living in any of the five boroughs applies for a job and the employer runs an AEDT on that application, the law applies, even if the company sits in another state and the role is fully remote.2New York City Administrative Code. New York City Administrative Code 20-871 – Requirements for Automated Employment Decision Tools Company size is irrelevant. A ten-person startup and a multinational bank owe the same duties, and third-party staffing agencies using these tools on behalf of clients are covered too. Employers cannot shift the obligation to the vendor that built the tool.
An AEDT is any computational process built on machine learning, statistical modeling, data analytics, or artificial intelligence that produces a simplified output — a score, classification, or recommendation — used to replace or substantially assist human decision-making in employment decisions.3New York City Administrative Code. New York City Administrative Code 20-870 – Definitions Resume-screening software that ranks candidates, chatbot interviews that score answers, and algorithms that flag employees as promotion-ready all fit.
“Substantially assist” trips up many employers. DCWP’s rules identify three qualifying scenarios: the employer relies solely on the tool’s output; the tool’s output carries more weight than any other single factor the employer considers; or the tool is used to override conclusions from other factors, including a human reviewer’s judgment.4American Legal Publishing. Rules of the City of New York – Title 6 – Chapter 5 – Subchapter T – Automated Employment Decision Tools A system that simply organizes applications alphabetically or runs a keyword search without scoring probably falls outside the definition. Anything that filters or ranks based on algorithmic analysis is in scope.
The Bias Audit Requirement
Before using an AEDT, the employer must have it evaluated in an independent bias audit performed no more than one year earlier.2New York City Administrative Code. New York City Administrative Code 20-871 – Requirements for Automated Employment Decision Tools This is not a one-time task. Every twelve months the audit must be refreshed and the posted summary updated.
What the Audit Measures
The auditor analyzes the tool’s historical data to calculate selection rates across the demographic groups used in federal EEO-1 reporting: race, ethnicity, and sex. The core question is whether the tool selects candidates from one group at a meaningfully different rate than another. The auditor produces impact ratios that compare each group’s selection rate to the rate of the most-selected group. A low ratio signals a possible disparate impact on a protected class.
The federal four-fifths rule provides useful context: the EEOC has treated a selection rate below 80% of the most-selected group’s rate as evidence of adverse impact, though the EEOC considers this a rough benchmark rather than a safe harbor. Passing or failing that test does not by itself determine Local Law 144 compliance. The audit report presents the numbers; what the employer does with them is a separate question.
When the tool is new and the employer’s applicant pool is too thin to analyze, the auditor may use data from other employers using the same tool, or other relevant test datasets.1Department of Consumer and Worker Protection. Automated Employment Decision Tools (AEDT)
Who Can Perform It
The auditor must be independent. DCWP applies three bright-line disqualifiers: the auditor cannot work for the employer, the employment agency, or the AEDT’s vendor; the auditor cannot have been involved in building or distributing the tool at any prior job; and the auditor cannot hold a direct or material indirect financial interest in any of those entities.5NYC Department of Consumer and Worker Protection. Automated Employment Decision Tools – Frequently Asked Questions The law does not require a particular credential or certification.
Notice, Posting, and Data-Disclosure Duties
Passing the audit is half the work. Employers also owe advance notice to individuals and public posting of results.
What Goes on the Website
Before using an AEDT, the employer must publish a summary of the most recent bias audit on its website, along with the distribution date of the tool the audit covers.2New York City Administrative Code. New York City Administrative Code 20-871 – Requirements for Automated Employment Decision Tools The summary usually lives in the careers section. It stays up for the life of the tool’s use and gets updated each time a new annual audit is completed.
Individual Notice
Every NYC candidate or employee who will be evaluated by an AEDT must receive individual notice at least 10 business days beforehand. The notice must say an AEDT will be used and describe the specific job qualifications or characteristics it will assess.2New York City Administrative Code. New York City Administrative Code 20-871 – Requirements for Automated Employment Decision Tools It must also tell the person they can request an alternative selection process or an accommodation.
Delivery can be by mail, email, or clear and conspicuous posting on the job application page. The method matters less than the timing. That 10-business-day window is firm, and missing it for even one candidate is a separate violation.
Data Disclosure on Request
A candidate or employee can send a written request asking what type of data the AEDT collects, where the data comes from, and how long the employer retains it. The employer has 30 days to respond.2New York City Administrative Code. New York City Administrative Code 20-871 – Requirements for Automated Employment Decision Tools The only permissible reasons to withhold are that disclosure would violate another law or interfere with a law enforcement investigation.
Penalties and Who Can Bring a Case
DCWP enforces the law and brings proceedings before the city’s Office of Administrative Trials and Hearings (OATH). The fine structure:
- Up to $500 for the first violation and any additional violations occurring on the same day.
- Between $500 and $1,500 for each subsequent violation after that first day.
Each day an employer uses an AEDT without a valid audit is a separate violation. Each person who does not receive the required notice is also a separate violation.6The New York City Council. New York City Administrative Code 20-872 – Penalties For a large employer running hundreds of applicants a day through a non-compliant tool, the numbers compound quickly.
There is no private right of action. Candidates cannot sue employers directly under Local Law 144; enforcement runs through DCWP. A tool that produces discriminatory outcomes can still expose the employer to separate claims under federal or state anti-discrimination law, which do allow private suits.
How To File a Complaint
If you believe an employer or staffing agency used an AEDT without a bias audit, without posting audit results, or without giving you the required notice, file a complaint through DCWP’s online complaint portal.1Department of Consumer and Worker Protection. Automated Employment Decision Tools (AEDT) You do not need an account to submit one, though having an account makes tracking easier.
Skip 311 for this. In test calls conducted by the State Comptroller’s office, 311 operators routed AEDT complaints to DCWP only 25% of the time; the rest were misdirected to the state Department of Labor or told to contact the employer directly.7Office of the New York State Comptroller. Enforcement of Local Law 144 – Automated Employment Decision Tools Use the online portal.
Where the Law Stops
Local Law 144 sits alongside federal law, not in place of it. Title VII of the Civil Rights Act and the Americans with Disabilities Act still apply to AI-driven hiring regardless of a clean bias audit. A tool that passes its audit can still support a federal disparate impact claim if its selection criteria are not job-related and consistent with business necessity. The audit is a floor, not a ceiling.
The law also does not cover employers outside NYC, and it does not satisfy obligations in other jurisdictions that regulate AI hiring. Illinois began requiring employers to notify applicants and employees whenever AI influences employment decisions as of January 1, 2026, with draft rules adding a four-year recordkeeping requirement. Colorado’s AI Act, effective June 30, 2026, requires employers to use reasonable care to protect against algorithmic discrimination based on any protected characteristic under state or federal law. If you hire across state lines, Local Law 144 compliance alone will not carry the load.