What does NYC Local Law 144 require?

NYC Local Law 144 (effective July 5, 2023) requires employers using automated employment decision tools (AEDTs) in hiring or promotion decisions for NYC-based roles to: (1) commission an independent bias audit completed before first use and annually thereafter; (2) post bias audit results on a publicly accessible website; and (3) provide written notice to candidates at least 10 business days before the AEDT is used. The NYC Department of Consumer and Worker Protection enforces LL 144 with penalties up to $1,500 per day per violation.

What is an automated employment decision tool (AEDT) under LL 144?

An AEDT under LL 144 is a computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output — scores, classifications, or recommendations — used to substantially assist or replace discretionary decision-making in employment decisions such as hiring, promotion, demotion, or termination. Tools that apply purely rule-based eligibility criteria without statistical scoring are generally not AEDTs. Resume screening software, video interview scoring tools, AI-based candidate ranking systems, and performance scoring AI are typically covered.

Who must conduct the bias audit under LL 144?

The bias audit must be conducted by an independent auditor — a person or entity that is not employed by the employer or the AEDT vendor, and that has no financial interest in the use of the AEDT. A vendor cannot audit its own AEDT, even if it engages an external statistics firm as a subcontractor if that firm has a revenue-sharing arrangement. The audit must calculate selection rates and impact ratios by sex, race/ethnicity, and intersectional categories, using historical data from the AEDT's use on real candidates (not test or synthetic data, unless historical data is insufficient).

What are the penalties for violating NYC Local Law 144?

DCWP enforces LL 144 with civil penalties: $375 for a first violation, up to $1,500 for subsequent violations within 12 months, and $1,500 per day for ongoing violations such as using an AEDT without a completed bias audit. Each candidate who did not receive required notice is a separate violation. For employers running high-volume hiring cycles (hundreds of candidates per month), penalties accumulate quickly — DCWP enforcement actions have resulted in settlements exceeding $500,000 for employers who used AEDTs through multiple hiring cycles without satisfying LL 144 requirements.

Does LL 144 apply to employers headquartered outside NYC?

Yes. LL 144 applies to employers using AEDTs for employment decisions affecting NYC-based employees or candidates for NYC roles — regardless of where the employer is headquartered. A company based in San Francisco using an AI resume screening tool for a NYC position is in scope. Remote employees working from NYC are covered even if the employer's office is elsewhere. The jurisdictional trigger is the location of the worker being evaluated, not the location of the employer or the AEDT vendor.

How does NYC LL 144 compare to California AB 2930?

Both require independent bias audits and public posting of results, but AB 2930 is broader and stricter. AB 2930 requires individual per-decision explanation rights (candidates can request why the AI scored them the way it did), formal opt-out rights with an alternative process, and covers a broader range of employment decisions including performance evaluation and compensation. LL 144 focuses on structural bias statistics without individual explanation rights. The penalties under AB 2930 (up to $10,000/day) are also higher. Employers operating in both jurisdictions should build to AB 2930's requirements — satisfying AB 2930 covers all LL 144 requirements as a subset.

What documentation must employers retain for LL 144?

LL 144 requires employers to retain bias audit records for at least three years: the auditor engagement documentation, the data provided to the auditor, the audit methodology, and the final audit report with selection rates and impact ratios. Employers must also retain notice records showing that candidates received required disclosures at least 10 business days before AEDT evaluation. Decision records showing which candidates were evaluated, when, and what the AEDT output was are essential for producing data for the next annual audit. Employers without per-decision records cannot provide auditors with the historical data the audit methodology requires.

NYC Local Law 144: Automated Employment Decision Tools — Bias Audit, Notice, and Enforcement Guide

New York City Local Law 144 (effective July 5, 2023) is the first AI employment law in the United States to reach active enforcement. It requires employers using automated employment decision tools (AEDTs) for NYC roles to commission an independent bias audit before use and annually thereafter, post results publicly, and provide written notice to candidates at least 10 business days before evaluation. The NYC Department of Consumer and Worker Protection enforces LL 144 with penalties up to $1,500 per day per violation. This guide explains who is covered, what the bias audit must include, DCWP enforcement history, and how LL 144 compares to California AB 2930.

Who NYC Local Law 144 Covers

LL 144 applies to employers that employ four or more employees in New York City and use an AEDT for employment decisions involving NYC-based roles — hiring, promotion, demotion, or termination. Remote employees working from NYC are covered. Employment agencies and staffing firms using AEDTs to screen candidates for NYC placements are also covered as employers. The law applies regardless of employer headquarters location — a San Francisco company using AI resume screening for NYC positions is in scope. An AEDT under LL 144 is a computational process derived from ML, statistical modeling, data analytics, or AI that issues simplified output (scores, classifications, recommendations) substantially assisting or replacing discretionary employment decisions.

Independent Bias Audit Requirements

The bias audit is the centerpiece of LL 144. It must be conducted by an independent auditor — not the employer, not the AEDT vendor, and not any party with a financial interest in the AEDT. The audit must calculate selection rates and impact ratios by sex, race/ethnicity, and intersectional categories (e.g., Hispanic females) using historical data from the AEDT's actual use on real candidates. Test data or synthetic data is insufficient unless historical data is unavailable. The audit must be completed before the AEDT is first used and within one year of the prior audit. A new audit is required after material changes to the AEDT including model architecture updates, training data changes, or scoring logic changes.

Notice Requirements

Employers must provide written notice to candidates at least 10 business days before the AEDT is used to evaluate them. Notice must disclose that an AEDT will be used, what job qualifications it evaluates, and how to request an accommodation or alternative process. Notice must be available in any language the employer regularly uses in job postings or candidate communications. For current employees subject to AEDT performance evaluation, notice must be provided by written communication. Unlike California AB 2930, LL 144 does not provide individual explanation rights — candidates cannot request why the AI scored them as it did. The law focuses on structural bias audit (aggregate statistics), not individual decision transparency.

DCWP Enforcement and Penalties

The NYC Department of Consumer and Worker Protection has conducted enforcement actions since the July 2023 effective date. Penalties: $375 for a first violation, up to $1,500 for subsequent violations within 12 months, $1,500 per day for ongoing violations. Each candidate who did not receive required notice is a separate violation. Employers running high-volume hiring without satisfying LL 144 requirements can accumulate penalties exceeding $500,000 per hiring cycle. DCWP considers good-faith remediation a mitigating factor in settlements. Retroactive documentation assembled after an investigation begins has limited defensive value — compliance documentation must predate enforcement inquiry.

NYC LL 144 vs. California AB 2930

Both laws require independent bias audits and public posting of results. AB 2930 is broader: it requires individual per-decision explanation rights (candidates can request why the AI scored them), formal opt-out rights with an alternative process guaranteed, and covers performance evaluation, compensation, and termination AI in addition to hiring. AB 2930 penalties are higher (up to $10,000/day). LL 144 focuses on structural bias statistics without individual explanation. Employers hiring in both jurisdictions should implement AB 2930 requirements across all AEDT deployments — AB 2930 compliance covers all LL 144 requirements as a subset, eliminating the need for separate New York-specific compliance programs.