NYC Local Law 144 of 2021, Automated Employment Decision Tools

What it is

Local Law 144 of 2021 is a New York City law regulating automated employment decision tools (AEDTs) used in hiring and promotion. It sits in sections 20-870 to 20-874 of the city’s Administrative Code. The Department of Consumer and Worker Protection (DCWP) adopted final rules in 6 RCNY sections 5-300 to 5-304, and enforcement began on 5 July 2023.

It was the first law in the United States to require bias audits of AI used in employment decisions. The obligations are narrow and mechanical, which makes them easy to describe and, as enforcement has shown, easy to overlook.

Who it applies to

The law applies to employers and employment agencies that use an AEDT to screen candidates for employment or employees for promotion in New York City.

An AEDT is a computational process derived from machine learning, statistical modelling, data analytics or AI that issues a simplified output, such as a score, classification, recommendation or ranking, used to substantially assist or replace discretionary decision-making. The DCWP rules narrow “substantially assist or replace” to three cases. The tool is in scope if the employer does one of the following.

• relies solely on the simplified output, with no other factors considered
• uses the output as one of a set of criteria and weights it more than any other criterion
• uses the output to overrule conclusions from other factors, including human judgement

Tools that only translate or transcribe, such as converting a CV from PDF or transcribing an interview, are not AEDTs.

What it requires

Bias audit within one year. An employer may not use or continue to use an AEDT if more than one year has passed since its most recent bias audit. The audit is an impartial evaluation by an independent auditor. At a minimum it calculates the following for sex categories, race and ethnicity categories (using the EEO-1 categories) and intersectional categories of sex, race and ethnicity.

• the selection rate, the rate at which people in a category are selected to move forward or assigned a classification
• or, where the tool scores rather than selects, the scoring rate, the rate at which people in a category score above the sample median
• the impact ratio, each category’s rate divided by the rate of the most selected or highest scoring category
• the number of individuals assessed who fall into an unknown category

Audits use historical data from the tool’s use, which can be pooled across employers. An employer can rely on a pooled audit only if it supplied its own historical data to the auditor or has never used the tool. Test data can be used where there is not enough historical data for a statistically significant audit, and the summary must explain why.

Published results. Before using the tool, the employer posts on the employment section of its website the date of the most recent audit, a summary of the results (including the data source, the number of individuals, the rates and impact ratios), and the date the employer began using the tool. The summary stays up for at least six months after the tool’s last use.

Notice. At least 10 business days before using the tool, the employer tells candidates who reside in the city, through its website, the job posting or by mail or email, that an AEDT will be used, which job qualifications and characteristics it will assess, and how to request an alternative selection process or reasonable accommodation if available. Employees being considered for promotion get the same notice in a written policy, the posting or by mail or email. The employer also publishes its AEDT data retention policy and the type and source of data collected, or explains on request within 30 days.

The law does not require an employer to offer an alternative process, and it sets no threshold an impact ratio must meet.

Key dates

• 5 July 2023. DCWP rules take effect and enforcement begins.
• 2 December 2025. The New York State Comptroller published an audit of DCWP’s enforcement, covering July 2023 to June 2025, which found it ineffective. DCWP agreed to most of the recommendations, including better complaint routing and staff training.

The audit pointed to problems with how complaints were handled and to compliance reviews that missed violations, particularly where employers neither posted audits nor gave notice. Employers who decided the law was dormant should not rely on that.

How it relates to other frameworks

Local Law 144 is about disclosure of disparate impact, not a ban on it. Liability for discriminatory outcomes still comes from Title VII of the Civil Rights Act, the New York State Human Rights Law and the New York City Human Rights Law, and the impact ratios in a published audit can be used as evidence in those claims.

Other employment rules ask different questions about the same tools. Illinois requires notice and prohibits discriminatory effect. California’s ADS regulations treat anti-bias testing as relevant evidence and require four years of records. Colorado SB 26-189 and the CCPA ADMT regulations both include employment among their covered decisions from 2027. Under the EU AI Act, recruitment and promotion tools are high-risk. An employer using one tool across several places needs one view of it that each of these regimes can read.

Working with it in Aicura

US state framework content is available in Aicura on the Enterprise tier and is switched on in Settings under Frameworks. The AI Register records each hiring and promotion tool, its vendor and the business unit that uses it, and the Cadence view shows how long ago each tool’s risk assessment and vendor review were last done. Vendor records track due diligence on each tool’s supplier, the contract in force and when the next review is due. Each risk assessment is tied to the exact version of the tool’s register entry it read, and recording a material change, such as a new model version from the vendor, re-runs it. Aicura does not perform the bias audit, which the law requires an independent auditor to carry out, and it gives guidance for your own judgement and your advisers’.