She continued, "if, on the other hand, the AI is designed to put people into buckets, like these candidates have relevant experience, these have relevant education – pick your criteria – that's not a tool that would fall within the AEDT definition." "If you have an AI tool that runs through 1,000 applications and says, 'these are the top 20 candidates,' that is clearly a tool that falls within the definition of an AEDT." "We are only talking about those tools that take the place of humans making decisions," Camacho Moran said. Just using an AI tool isn't enough to mandate disclosure: It must have a direct effect on hiring outcomes in order for the law to apply. "This is narrowly focused on the use of AI in hiring or promoting employees but not any other employment lifecycle decisions. "It's the very first law that's specifically calling out automated decision employment tools and regulating those specifically," Littler Mendelson employment attorney Niloy Ray told CBS MoneyWatch.
It also mandates that employers conduct annual third-party "bias audits" of the technology or software they use, in order to make public the ways in which the AI could be discriminating against certain types of candidates. Specifically, it requires companies that lean on AI tools to make hiring decisions to disclose this fact to candidates. The narrowly tailored law is designed to offset potential misuses of AI in ways that could substantially affect workers' livelihoods. Other cities and states expected to gradually follow suit. The city's automated employment decision tools law, enacted in 2021 and scheduled to be enforced beginning July 5, positions New York City as a leader in regulating the use of AI in hiring. Starting today, job-hunters in New York City will be let in on a formerly hidden part of the application process, learning whether - and how - artificial intelligence is being used to make hiring decisions.
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