Home The Impact of NYC’s Anti-Bias Law on Hiring Algorithms

The Impact of NYC’s Anti-Bias Law on Hiring Algorithms

In recent years, there has been a rise in the prevalence of the application of artificial intelligence (AI) algorithms in the process of hiring new employees. However, because of concerns about bias and discrimination in these algorithms, new regulations have been implemented to ensure fair and equitable hiring practices. These regulations were created to ensure that fair and equitable hiring practices are followed.

One of these regulations is the anti-bias law that was just recently passed in New York City (NYC), which requires employers to submit their hiring algorithms for independent audits and disclose the results to job candidates. This regulation was recently implemented in NYC. In this article, we will investigate the potential implications of this ground-breaking law and how it might affect the development of hiring algorithms in the future.

In New York City, Local Law 144, also referred to as the anti-bias law, was recently passed with the intention of addressing the potential biases that may be present in hiring algorithms. Employers who make use of these algorithms are required to hand them over for auditing by an independent party and to make the findings of the audit public. In addition, the law mandates that employers must provide disclosures to their staff members as well as candidates for employment regarding the use of algorithms in the selection process.

According to the law, the reports that are made public must include information about the algorithms that are being used as well as the impact those algorithms have on candidates of varying races, ethnicities, and genders. This includes a “average score” that is given to candidates from various groups as well as “impact ratios” that compare the scores of various categories to one another. The law intends to do so by making this information available, with the goal of shedding light on any potential biases or disparities in the outcomes of hiring.

The inherent biases that can be amplified by AI algorithms are the root cause of the necessity for such a law to exist. The Chief Executive Officer of Applied, a company that develops technology for the recruitment industry, Khyati Sundaram, discusses how recruitment AI has the potential to exacerbate existing biases in the hiring process. She emphasizes the importance of human judgment and intervention when it comes to the hiring process, advising against placing sole reliance on computer algorithms to make decisions.

The existence of bias in various hiring algorithms has been extensively researched and documented. For instance, in 2018, Amazon got rid of a recruiting engine because it was discovered that it was biased against female job applicants. In a similar vein, an academic study conducted in 2019 discovered anti-Black bias in recruiting that was enabled by AI. These cases illustrate the urgent need to address biases in AI algorithms in order to ensure that hiring practices are fair and equitable.

It is essential to keep in mind that the application of Local Law 144 is not limited to workers based in New York City. As long as a person is working or looking for work in the city, they are within the purview of the law and are entitled to protection from it. Because of this comprehensive coverage, it is guaranteed that no individual, regardless of where they were born or where they currently reside, will ever be subjected to discriminatory algorithms.

It is the responsibility of the New York City Department of Consumer and Worker Protection to ensure compliance with the law; failing to do so may result in the imposition of severe fines. Companies that are found to be in violation of the law face potential fines that can range anywhere from $375 for a first offense to $1,500 for subsequent violations. Each day that a company continues to use algorithms that do not comply with the standards is considered to be a separate violation.

It is anticipated that the application of Local Law 144 will have a significant effect on the utilization of various hiring algorithms. The law brings a new level of accountability and transparency to the hiring process, despite the fact that nearly one in four companies are already using AI in their candidate selection processes. If a company does not take the necessary steps to ensure that its algorithms are just and unbiased, it runs the risk of being penalized.

There is a wide range of variety in the algorithms that are used in the hiring process. Text analyzers that classify resumes according to keywords, chatbots that conduct online interviews, and software that predicts a candidate’s problem-solving abilities and cultural compatibility are a few examples of common types of recruitment software. In order for businesses to remain in compliance with the law following the adoption of Local Law 144, it will be necessary for these algorithms to undergo careful analysis and, if necessary, be modified.

The passage of Local Law 144 is merely the first step in eliminating bias from hiring algorithms. The industry as a whole has come to the realization that there is a need for self-regulation and has begun taking preliminary steps to combat algorithmic bias. For instance, in December 2021, the Data & Trust Alliance was established with the intention of creating an evaluation and scoring system with the purpose of identifying and reducing bias in AI algorithms, particularly those used in the hiring process.

Even though there are organizations that believe that Local Law 144 does not go far enough, the law does mandate that independent audits be carried out by organizations that were not involved in the creation or distribution of the algorithms. This requirement aims to ensure that the auditing process is conducted in an objective and credible manner. On the other hand, some people believe that businesses shouldn’t be solely responsible for developing a certification system for their own artificial intelligence products because this could lead to inherent conflicts of interest.

The adoption of Local Law 144 in New York City establishes an important precedent for other jurisdictions that are contemplating the adoption of similar regulations. It is highly likely that the implementation of this law, whether it is successful or not, will have an effect on future legislation in other cities and states. For instance, the district of Columbia is mulling over the possibility of enacting a rule that would make employers legally liable for ensuring that automated decision-making systems are free from bias. In addition, legislation has been proposed in California to regulate the use of AI in hiring, and legislation has recently been proposed in New Jersey to reduce the likelihood of discrimination in hiring decisions that involve AI.

These legislative efforts reflect a growing recognition of the importance of addressing biases in AI algorithms, particularly in the context of hiring. This is especially the case when it comes to hiring. As technological progress continues to be made, it is of the utmost importance to check that these new developments are not exacerbating pre-existing prejudices or helping to maintain discrimination in the workplace.

The passage of the anti-discrimination law in New York City is a significant step toward achieving the goal of ensuring that hiring procedures are both fair and transparent. The law intends to identify and address any potential biases that may be present in these algorithms by mandating that independent audits and public disclosures be carried out. Although it is not yet known how effective the law will be in practice, it is likely that its impact will shape future legislation as well as industry practices. It is essential for businesses to place a priority on fairness and equity as they continue to integrate AI into their recruitment procedures in order to cultivate a workforce that is more inclusive and diverse.

First reported for TechCrunch

About ReadWrite’s Editorial Process

The ReadWrite Editorial policy involves closely monitoring the tech industry for major developments, new product launches, AI breakthroughs, video game releases and other newsworthy events. Editors assign relevant stories to staff writers or freelance contributors with expertise in each particular topic area. Before publication, articles go through a rigorous round of editing for accuracy, clarity, and to ensure adherence to ReadWrite's style guidelines.

Brad Anderson
Former editor

Brad is the former editor who oversaw contributed content at ReadWrite.com. He previously worked as an editor at PayPal and Crunchbase.

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