NYC Local Law 144 Guide

Overview

New York City Local Law 144 of 2021 regulates the use of Automated Employment Decision Tools (AEDTs) in hiring and promotion decisions. Enforced by the NYC Department of Consumer and Worker Protection (DCWP), it's the first law of its kind in the United States.

The law applies to any employer or employment agency that uses an AEDT to screen candidates or employees who reside in New York City.

Key Requirements

Annual Independent Bias Audit

Before using an AEDT, employers must have it independently audited for bias no more than one year prior to use. The audit must be conducted by an independent auditor with no financial interest in the employer or AEDT vendor.

Public Summary Posting

A summary of the audit results must be publicly posted on the employer's website. This must include the date of the most recent audit, the selection rates and impact ratios for all demographic categories, and the distribution date of the AEDT.

Candidate Notification

Employers must notify candidates at least 10 business days before using an AEDT. The notice must describe the job qualifications and characteristics the AEDT will assess, the data sources, and information about how to request an alternative selection process.

What the Audit Must Include

Per DCWP's final rules, the bias audit must calculate:

Selection rates for each demographic category (sex and race/ethnicity)
Impact ratios comparing each group's selection rate to the most-selected group
Intersectional analysis for sex × race/ethnicity combinations
Unknown category reporting for applicants with missing demographic data

If the AEDT produces a score rather than a binary selection, the audit must analyze "scoring rates" (the proportion of candidates scoring above the median or a specified threshold).

Enforcement & Penalties

Civil Penalties

Violations carry civil penalties of $500 for the first violation, $500–$1,000 for the second violation within 24 months, and $1,000–$1,500 for each subsequent violation. Each day an AEDT is used in violation constitutes a separate violation.

DCWP has authority to investigate complaints, conduct audits, and issue violations. The agency began enforcement in July 2023 with an initial focus on education and outreach.

How Paritas Helps

Paritas goes beyond LL144's minimum requirements:

Permanent public hosting at paritas.ai satisfies the public posting requirement
Three-tier classification (PASS/MONITOR/FLAG) provides clearer risk assessment than raw numbers
Statistical significance testing adds rigor beyond the four-fifths rule
Simpson's Paradox analysis identifies hidden disparity patterns
Multi-jurisdiction mapping shows how findings apply to Colorado, Illinois, and EEOC frameworks
Remediation recommendations tell you what to do, not just what's wrong

NYC Local Law 144