NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A9314
SPONSOR: Alvarez TITLE OF BILL:
An act to amend the labor law, in relation to establishing criteria for
the use of automated employment decision tools
PURPOSE OR GENERAL IDEA OF BILL:
To limit bias and discrimination against any group on the basis of sex,
race, ethnicity, or other protected class that occurs when automated
employment decision tools are used to screen candidates for hire.
SUMMARY OF PROVISIONS:
Section 1 would prohibit employers from using automated employment deci-
sion tools unless they have a disparate impact analysis conducted annu-
ally, publish a summary of the audit and distribution date on their
website, and provide the Department of Labor with the summary of the
most recent disparate impact analysis no less than annually. The bill
would'also define relevant terms, such as "automated employment decision
tool" and "disparate impact analysis.." The Attorney General would be
authorized to initiate an investigation if suspicion of a violation is
established and subsequently pursue action against an employer.
Section 2 would set the effective date.
JUSTIFICATION:
In today's job market, employers may receive hundreds of job applica-
tions for a single role. To efficiently evaluate candidates, employers
rely on employment decision tools, like skills tests, resume reading
systems, and automated screening platforms. Many employment decision
tools are developed by third-party vendors, but this industry of HR tech
providers is largely unregulated.
Importantly, employers are not held to any meaningful standards when it
comes to disclosing the bias (legally defined as "disparate impact" or
"adverse impact") yielded by these products. As a result, many employers
continue to use hiring tools that disproportionately screen out racial
minorities. Additionally, candidates engaging with these assessments
often are not informed about their purpose or what they are designed to
measure.
PRIOR LEGISLATIVE HISTORY:
2023-2024: A567 - Referred to Labor; enacting clause stricken
2021-2022: A7244-A - advanced to third reading
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
To be determined.
EFFECTIVE DATE:
This act would take effect immediately..
STATE OF NEW YORK
________________________________________________________________________
9314
IN ASSEMBLY
February 28, 2024
___________
Introduced by M. of A. ALVAREZ -- read once and referred to the Commit-
tee on Labor
AN ACT to amend the labor law, in relation to establishing criteria for
the use of automated employment decision tools
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. The labor law is amended by adding a new section 203-g to
2 read as follows:
3 § 203-g. Use of automated employment decision tools. 1. For purposes
4 of this section, the following terms shall have the following meanings:
5 a. "Automated employment decision tool" means any system used to
6 filter employment candidates or prospective candidates for hire in a way
7 that establishes a preferred candidate or candidates without relying on
8 candidate-specific assessments by individual decision-makers. Automated
9 employment decision tools shall include personality tests, cognitive
10 ability tests, resume scoring systems and any system whose function is
11 governed by statistical theory, or whose parameters are defined by such
12 systems, including inferential methodologies, linear regression, neural
13 networks, decision trees, random forests and other artificial intelli-
14 gence or machine learning algorithms. The term "automated employment
15 decision tool" does not include a tool that does not automate, support,
16 substantially assist or replace discretionary decision-making processes
17 and that does not materially impact natural persons.
18 b. "Disparate impact analysis" means an impartial analysis, including
19 but not limited to testing of the extent to which use of an automated
20 employment decision tool is likely to result in an adverse impact to the
21 detriment of any group on the basis of sex, race, ethnicity, or other
22 protected class under article fifteen of the executive law. The results
23 of such analysis shall be reported to the employer implementing or using
24 an automated employment decision tool. A disparate impact analysis
25 shall differentiate between candidates who were selected and candidates
26 who were not selected by the tool and shall include a disparate impact
27 analysis as specified in the uniform guidelines on employee selection
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD02768-05-4
A. 9314 2
1 procedures promulgated by the United States equal employment opportunity
2 commission.
3 c. "Employment decision" means to screen candidates for employment.
4 2. It shall be unlawful for an employer to implement or use an auto-
5 mated employment decision tool that fails to comply with the following
6 provisions:
7 a. No less than annually, a disparate impact analysis shall be
8 conducted to assess the actual impact of any automated employment
9 decision tool used by any employer to select candidates for jobs within
10 the state. Such disparate impact analysis shall be provided to the
11 employer but shall not be publicly filed and shall be subject to all
12 applicable privileges.
13 b. A summary of the most recent disparate impact analysis of such tool
14 as well as the distribution date of the tool to which the analysis
15 applies has been made publicly available on the website of the employer
16 or employment agency prior to the implementation or use of such tool.
17 c. No less than annually, any employer using an automated employment
18 decision tool shall provide to the department such summary of the most
19 recent disparate impact analysis provided to the employer on that tool.
20 3. The attorney general may initiate an investigation if a preponder-
21 ance of the evidence, including the summary of the most recent dispa-
22 rate impact analysis establishes a suspicion of a violation. The
23 attorney general may also initiate in any court of competent jurisdic-
24 tion any action or proceeding that may be appropriate or necessary for
25 correction of any violation issued pursuant this section, including
26 mandating compliance with the provisions of this section or such other
27 relief as may be appropriate.
28 4. The commissioner may initiate an investigation if a preponderance
29 of the evidence, including the summary of the most recent disparate
30 impact analysis establishes a suspicion of a violation. The commission-
31 er may also initiate in a court of competent jurisdiction any action or
32 proceeding that may be appropriate or necessary for the correction of
33 any violation issued pursuant to this section, including mandating
34 compliance with the provisions of this section or such other relief as
35 may be appropriate.
36 5. The department may promulgate rules and regulations as it deems
37 necessary to effectuate the purposes of this section, on or before such
38 effective date.
39 § 2. This act shall take effect immediately.
