# NYC Local Law 144 in 2026: Bias Audits, Notices, and Penalties for Automated Employment Decision Tools

Source: https://superintelligencecompliance.ai/guides/nyc-local-law-144  
Publisher: ZSKFL Management  
Last updated: 2026-10-26. Not legal advice.

> NYC Local Law 144 requires an independent bias audit of an AEDT within a year before use, a posted summary, and candidate notice 10 business days ahead.

## At a glance

- NYC Local Law 144 (Administrative Code 20-870 to 20-874) bars employers and employment agencies from using an automated employment decision tool (AEDT) to screen candidates or employees for hiring or promotion in the city unless the tool had an independent bias audit no more than one year before use and a summary of the results is posted.
- Candidates and employees who reside in the city must get notice at least 10 business days before use, with instructions for requesting an alternative selection process or a reasonable accommodation.
- Penalties: not more than $500 for a first violation and each additional violation that day, then $500 to $1,500 for each subsequent violation. Each day of use without a current audit or posted summary is a separate violation.
- The law sets no pass or fail threshold. A December 2, 2025 State Comptroller audit found enforcement by the Department of Consumer and Worker Protection (DCWP) ineffective.

## What is NYC Local Law 144?

NYC Local Law 144 makes it unlawful for an employer or employment agency to use an AEDT to screen a candidate or employee for an employment decision in the city unless the tool has been the subject of a bias audit conducted no more than one year before use, and a summary of the most recent audit, with the tool’s distribution date, has been posted on the employer’s or agency’s website before use (Admin. Code 20-871(a)). It also requires advance notice to candidates and employees who reside in the city (20-871(b)).

The Council approved the bill, Int. No. 1894-A, on November 10, 2021; its record lists an enactment date of December 11, 2021, and the mayor returned it unsigned. It took effect January 1, 2023. DCWP published its final rule (6 RCNY 5-300 to 5-304) on April 6, 2023 and began enforcement on July 5, 2023.

**Local Law 144 duties, from the Administrative Code and DCWP’s rule**

| Duty | Section | What it requires |
|---|---|---|
| Bias audit | Admin. Code 20-871(a)(1); 6 RCNY 5-301, 5-302 | An independent audit no more than one year before use; no use or continued use once more than a year has passed since the most recent audit |
| Published results | 20-871(a)(2); 6 RCNY 5-303 | Date and summary of the most recent audit and the distribution date, posted before use on the employment section of the website and kept up at least 6 months after the latest use |
| Notice of use | 20-871(b)(1); 6 RCNY 5-304(a) to (c) | At least 10 business days before use, to candidates and employees who reside in the city, with instructions for requesting an alternative selection process or a reasonable accommodation under other laws, if available |
| Notice of what is assessed | 20-871(b)(2) | The job qualifications and characteristics the tool will use, at least 10 business days before use |
| Data information | 20-871(b)(3); 6 RCNY 5-304(d) | Type of data collected, its source, and the retention policy on the website, with responses to written requests within 30 days |
| Penalties and enforcement | 20-872 to 20-874 | Civil penalties per violation; daily violations for unlawful use; separate violations for missed notices; private suits and Commission on Human Rights authority preserved |

## What counts as an automated employment decision tool?

An AEDT is “any computational process, derived from machine learning, statistical modeling, data analytics, or artificial intelligence, that issues simplified output, including a score, classification, or recommendation, that is used to substantially assist or replace discretionary decision making for making employment decisions that impact natural persons” (Admin. Code 20-870). Tools that do not automate, support, substantially assist or replace discretionary decision-making and do not materially impact natural persons, such as a junk email filter, spreadsheet, or database, are excluded.

DCWP’s rule defines “to substantially assist or replace discretionary decision making” as one of three uses (6 RCNY 5-300):

- relying solely on a simplified output, such as a score, tag, classification, or ranking, with no other factors considered;
- using a simplified output as one of a set of criteria where it is weighted more than any other criterion in the set; or
- using a simplified output to overrule conclusions derived from other factors, including human decision-making.
The rule also defines the technique behind the tool. It must generate a prediction or classification, and a computer must at least in part identify the inputs, their relative importance, and, if applicable, other parameters. Output from a tool that only translates or transcribes existing text, such as converting a résumé from PDF or transcribing an interview, is not a simplified output.

The three prongs narrow the statute. A score a recruiter reads as one input among several, weighted no more than any other criterion and never used to overrule other conclusions, meets none of them; the Comptroller’s audit reads the rule the same way.

An employment decision means screening candidates for employment or employees for promotion within the city. DCWP’s FAQ says that includes screening at any point, not only the final decision. It does not include using a tool to scan a résumé bank, conduct outreach, or invite applications, because a candidate is a person who has applied for a specific position.

## Who does Local Law 144 cover?

The law covers employers and employment agencies that use an AEDT “in the city.” DCWP’s FAQ treats a use as in the city if the job is located at a New York City office at least part time, if the job is fully remote but the location associated with it is a New York City office, or if the employment agency using the tool is located in the city.

For remote roles, the test is the office the job is associated with, not where the worker sits. The FAQ does not reach a fully remote job tied to an office outside the city unless a city-based employment agency uses the tool.

The audit and the notice reach different people. The audit and posting duty applies to any covered use, but notice is owed only to candidates and employees who reside in the city (20-871(b)).

According to the FAQ, the vendor that built the tool is not responsible for the audit. A vendor may commission an independent audit, but the employer or agency must make sure an audit was done before use.

In the Comptroller’s audit, DCWP officials said the city’s Law Department advised that Local Law 144 does not apply to city agencies.

## What must a bias audit include?

A bias audit is an impartial evaluation by an independent auditor that includes, but is not limited to, testing the tool’s disparate impact on the sex and race or ethnicity categories employers report to the EEOC on the EEO-1 Component 1 report (20-870; 6 RCNY 5-300). Auditors need no DCWP approval.

An auditor is not independent if it is or was involved in using, developing, or distributing the tool, or if at any point during the audit it has an employment relationship with, or a direct financial interest or material indirect financial interest in, an employer or agency that seeks to use or continue to use the tool or the vendor that developed or distributes it. The Comptroller counted three of 22 employers’ audits as potentially not independent, including two where an independent auditor wrote the report but the vendor performed the testing.

**The two bias audit methods in 6 RCNY 5-301**

| Method | When it applies | Rate | Impact ratio |
|---|---|---|---|
| Selection rate (5-301(b)) | The tool selects people to move forward or classifies them into groups | Number in a category moved forward or assigned a classification, divided by the number in that category who applied or were considered | Category’s selection rate divided by the selection rate of the most selected category |
| Scoring rate (5-301(c)) | The tool scores people | Rate at which people in a category score above the median score of the full sample | Category’s scoring rate divided by the scoring rate of the highest scoring category |

Either way, the audit must calculate impact separately for sex categories, race and ethnicity categories, and intersectional categories, and state how many people the tool assessed who fall in an unknown category and were left out. A tool that sorts people into specified groups, such as leadership styles, needs the calculations for each group. In the rule’s example, if 100 Hispanic women apply and 40 are selected for an interview, their selection rate is 40%.

An auditor may exclude a category that represents less than 2% of the audit data from the impact ratio calculations, but the summary must give the justification and still report that category’s number of applicants and selection or scoring rate (5-301(d)).

No result fails the audit. The FAQ says the law requires no specific action based on the results, and neither the law nor the rule sets a cutoff, though DCWP describes the calculations as consistent with the EEOC’s Uniform Guidelines (29 C.F.R. 1607.4). Anti-discrimination laws still apply, and DCWP refers discrimination claims to the city’s Commission on Human Rights.

## What data can the audit use?

Historical data, meaning data from an employer’s or agency’s own use of the tool (6 RCNY 5-302(a)). An audit may pool historical data from several employers, but an employer may rely on a pooled audit only if it gave the auditor its own historical data or has never used the tool.

Test data is the exception. An employer may rely on an audit using test data if insufficient historical data is available for a statistically significant audit, and the summary must explain why historical data was not used and how the test data was generated and obtained (5-302(b)). DCWP has set no significance threshold and no test data requirements. Under the rule’s third example, an employer with three years of statistically significant data may not rely on test data.

The FAQ adds two points: imputed or inferred demographic data cannot be used, and if historical data was limited, for example to one region or period, the audit should explain why. The Comptroller found nine of 22 employers’ audits did not adequately give the source and explanation of the data.

## What must be published, and for how long?

Before use, the employer or agency must post clearly and conspicuously, on the employment section of its website, the date of the most recent audit, a summary of its results, and the tool’s distribution date, meaning the date the employer or agency began using the tool (6 RCNY 5-303(a)). The summary must include the source and explanation of the data, the number of people in an unknown category, and the number of applicants or candidates, the selection or scoring rates, and the impact ratios for all categories.

A clearly identified hyperlink to the results satisfies the rule. The summary and distribution date must stay posted for at least 6 months after the tool’s latest use for an employment decision (5-303(b) and (c)). Because an audit supports only one year of use, a tool in continuing use needs a new audit and summary yearly.

## What notices must candidates and employees receive?

Each candidate or employee who resides in the city must be told, at least 10 business days before use, that an AEDT will be used and which job qualifications and characteristics it will assess (20-871(b)(1) and (2)). The statute says the notice must “allow a candidate to request an alternative selection process or accommodation.” The rule requires instructions for requesting an alternative selection process or a reasonable accommodation under other laws, if available, and states that it does not require an employer to provide an alternative selection process (6 RCNY 5-304(a)).

- **Candidates:** a clear and conspicuous notice on the employment section of the website, in the job posting, or by U.S. mail or email.
- **Employees considered for promotion:** a written policy or procedure provided to employees, the job posting, or U.S. mail or email.
Per the FAQ, a website notice need not be position-specific, and use may begin 10 business days after it is posted, whatever the job’s posting date.

For data, the employer must post its AEDT data retention policy, the type of data collected, its source, and instructions for a written request, and must answer a written request within 30 days. Where disclosure would violate local, state, or federal law or interfere with a law enforcement investigation, the employer must explain why instead (5-304(d)).

## What are the penalties under Local Law 144?

A violator is liable for a civil penalty of not more than $500 for a first violation and each additional violation on the same day as the first, and not less than $500 nor more than $1,500 for each subsequent violation (20-872(a)). Each day a tool is used in violation of the audit and posting requirements is a separate violation, and failure to give any of the three required notices is a separate violation (20-872(b) and (c)). The Comptroller estimated $152,000 in fines for one AEDT vendor that said it had been using an AEDT since August 2024 without posting a bias audit as of June 2025. The report does not say whether the vendor used the tool in its own hiring; DCWP’s FAQ places the audit duty on employers and employment agencies that use a tool, not on the vendor that built it.

Penalty cases go to the Office of Administrative Trials and Hearings or another designated city tribunal; the Corporation Counsel, or persons it designates on behalf of DCWP, may bring a court action to correct a violation, including to compel compliance (20-872(d), 20-873). The law does not limit a candidate’s or employee’s right to sue, or the Commission on Human Rights’ authority under the City Human Rights Law (20-874).

## How is Local Law 144 enforced in practice?

Mostly through complaints. The State Comptroller’s December 2, 2025 audit, covering July 2023 through June 2025, found that approach ineffective.

- **Complaints:** DCWP received two AEDT complaints. One was outside the city’s jurisdiction; DCWP closed the other after the employer gave a sworn declaration that its tool only recorded interviews for human review.
- **311 routing:** nine of the auditors’ 12 test calls to 311 were not connected to DCWP; eight were referred to the State Department of Labor.
- **Compliance review:** DCWP reviewed 32 company websites, 22 employers and 10 vendors, and identified a single issue. The Comptroller found at least 17 instances of potential non-compliance among the same companies: three audits not by an independent auditor, five with improper calculations, and nine without an adequate explanation of the data. DCWP sent “demand” letters to two employers.
The audit describes no civil penalty imposed under the law in that period. DCWP generally agreed with the 13 recommendations, which include research beyond complaints and monitoring of the annual audit requirement, while disputing some findings. The Comptroller asked for an implementation report within 180 days.

Light enforcement is not low risk: a posted audit is public evidence, and Section 20-874 preserves private suits.

## What changed in 2026?

Nothing that changes employer duties. As of October 26, 2026, no local law had amended the Local Law 144 subchapter, and DCWP’s AEDT page still pointed to the 2023 rule and FAQ. Two Council actions touch the subject:

- **Local Law 25 of 2026** (Int. No. 1066-A of 2024), passed December 18, 2025 and returned unsigned by the mayor on January 20, 2026, directs the Department of Information Technology and Telecommunications to study how algorithmic tools and AEDTs, as defined in 20-870, affect city employees and to report to the mayor and the Speaker. It adds no duty for private employers.
- **Int. No. 919 of 2026**, introduced May 20, 2026 and in the Committee on Consumer and Worker Protection as of October 26, 2026, would create an office of artificial intelligence oversight within DCWP to take complaints about AI use that violates consumer protection laws DCWP enforces. It does not amend the Local Law 144 subchapter.

## How does Local Law 144 compare with Illinois, Colorado, and California?

New York City requires a test and publication. Illinois imposes liability for discriminatory effect plus notice, Colorado imposes procedural duties from 2027, and California adds privacy rules and a 2027 statute on discipline and termination.

**AI hiring and employment laws compared, as of October 26, 2026**

| Feature | NYC Local Law 144 | Illinois HB 3773 | Colorado SB 26-189 | California (CCPA ADMT rules, SB 947) |
|---|---|---|---|---|
| Status | Enforced since July 5, 2023 | In force since January 1, 2026 | Applies January 1, 2027; an order in *X.AI LLC v. Weiser* bars the Attorney General from enforcing it, including by investigation, for violations occurring on or before 14 days after the court rules on xAI’s preliminary injunction motion; no motion filed as of October 26, 2026 | ADMT duties January 1, 2027; SB 947 operative July 1, 2027 |
| Decisions covered | Screening for hiring or promotion in the city | Recruitment, hiring, promotion, renewal of employment, selection for training or apprenticeship, discharge, discipline, tenure, and the terms, privileges, or conditions of employment | Consequential decisions, including employment, that ADMT materially influences | ADMT rules: significant decisions, including employment; SB 947: discipline and termination |
| Testing | Annual independent bias audit, summary posted | No audit duty in the statute; liability for AI use that has the effect of discriminating; no zip codes as a proxy | No impact assessment or risk management program; duties are procedural | Risk assessments under the ADMT rules; under the FEHA rules, anti-bias testing, or its absence, is relevant but not required |
| Notice and human role | Notice at least 10 business days before use to candidates and employees who reside in the city; instructions to request an alternative selection process or accommodation | Notice to employees; the Department of Human Rights withdrew its proposed notice rules on June 2, 2026, and none had been adopted as of October 2026 | Notice before use; explanation within 30 days after an adverse decision; human review on request, to the extent commercially reasonable | Pre-use notice, access, and opt-out or appeal; SB 947 bars sole reliance, with narrow exceptions, and requires human corroboration and a stand-alone written notice where the employer relies primarily on a system |
| Enforcer | DCWP; private suits and the Commission on Human Rights preserved | Department of Human Rights | Attorney General | CPPA and Attorney General; for SB 947, the Labor Commissioner and public prosecutors |

A New York City audit covers sex and race or ethnicity, not age or disability, and does not supply the Illinois notice, the Colorado explanation, or California’s human corroboration. See the [Colorado guide](https://superintelligencecompliance.ai/guides/colorado-sb-26-189) and the [California guide](https://superintelligencecompliance.ai/guides/california-ai-laws).

## What should an employer do to comply with Local Law 144?

- Inventory every tool that scores, ranks, tags, or recommends candidates, and record which of the three rule prongs its use meets, if any
- Map each opening, including remote roles, to an office, and identify which candidates reside in the city
- Confirm the auditor meets all three independence tests and that the auditor, not the vendor, ran the testing
- Give the auditor your own historical data, even for a vendor’s pooled audit, unless you have never used the tool; use test data only if historical data is insufficient
- Check the summary for rates and impact ratios by sex, race and ethnicity, and intersectional category, the unknown-category count, any 2% exclusions with justification, and the data source
- Post the summary and distribution date before use, calendar the next audit before the one-year mark, and keep each summary up at least 6 months after last use
- Publish the candidate notice, with the qualifications assessed and accommodation instructions, at least 10 business days before use
- Post the data type, source, and retention policy, and route written requests so answers go out within 30 days
- Review impact ratios with employment counsel under other anti-discrimination laws
Related: the [AI in hiring and HR guide](https://superintelligencecompliance.ai/guides/ai-compliance-employment-hr) covers liability, Title VII, and the FCRA; the [employers and HR page](https://superintelligencecompliance.ai/industries/employers-hr) sorts rules by location and headcount; the [state AI laws hub](https://superintelligencecompliance.ai/guides/us-state-ai-laws) covers other states; the [updates page](https://superintelligencecompliance.ai/updates) tracks changes.

This guide is general information as of October 26, 2026, not legal advice; confirm the current text with DCWP, the City Council, or counsel before acting on it.

## Sources

- [Int. No. 1894-A, Local Law 144 of 2021 (Administrative Code 20-870 to 20-874), legislation text and history](https://legistar.council.nyc.gov/LegislationDetail.aspx?ID=4344524&GUID=B051915D-A9AC-451E-81F8-6596032FA3F9&Options=ID%7CText%7C&Search=), New York City Council, accessed October 26, 2026.
- [Notice of Adoption of Final Rule, Automated Employment Decision Tools (6 RCNY 5-300 to 5-304) (PDF)](https://rules.cityofnewyork.us/wp-content/uploads/2023/04/DCWP-NOA-for-Use-of-Automated-Employment-Decisionmaking-Tools-2.pdf), NYC Department of Consumer and Worker Protection, April 2023.
- [Automated Employment Decision Tools (Updated): rule status and effective date](https://rules.cityofnewyork.us/rule/automated-employment-decision-tools-updated/), NYC Rules, accessed October 26, 2026.
- [Automated Employment Decision Tools (AEDT)](https://www.nyc.gov/site/dca/about/automated-employment-decision-tools.page), NYC Department of Consumer and Worker Protection, accessed October 26, 2026.
- [Automated Employment Decision Tools: Frequently Asked Questions (PDF)](https://www.nyc.gov/assets/dca/downloads/pdf/about/DCWP-AEDT-FAQ.pdf), NYC Department of Consumer and Worker Protection, June 29, 2023.
- [Enforcement of Local Law 144: Automated Employment Decision Tools](https://www.osc.ny.gov/state-agencies/audits/2025/12/02/enforcement-local-law-144-automated-employment-decision-tools), Office of the New York State Comptroller, December 2, 2025.
- [Enforcement of Local Law 144: Automated Employment Decision Tools, audit report 2024-N-6 (PDF)](https://www.osc.ny.gov/files/state-agencies/audits/pdf/sga-2026-24n6.pdf), Office of the New York State Comptroller, December 2, 2025.
- [Int. No. 1066-A of 2024, Local Law 25 of 2026, legislation text and history](https://legistar.council.nyc.gov/LegislationDetail.aspx?ID=6874682&GUID=0B6A4E8B-4D49-437B-BB70-50B898D2BD7F), New York City Council, accessed October 26, 2026.
- [Int. No. 919 of 2026, Establishing an office of artificial intelligence oversight](https://legistar.council.nyc.gov/LegislationDetail.aspx?ID=8034442&GUID=669B5731-411B-40A9-99F2-6AD05E945AE8), New York City Council, accessed October 26, 2026.
- [Public Act 103-0804](https://www.ilga.gov/Legislation/publicacts/view/103-0804), Illinois General Assembly, 2024.
- [Illinois Postpones Proposed Regulations on AI in Employment](https://ogletree.com/insights-resources/blog-posts/illinois-postpones-proposed-regulations-on-ai-in-employment/), Ogletree Deakins, June 4, 2026.
- [SB26-189 Automated Decision-Making Technology](https://leg.colorado.gov/bills/SB26-189), Colorado General Assembly, 2026.
- [Docket, X.AI LLC v. Weiser, No. 1:26-cv-01515 (D. Colo.), Minute Order, ECF No. 24 (April 27, 2026)](https://www.courtlistener.com/docket/73171074/x-ai-llc-v-weiser/), CourtListener RECAP, accessed October 2026.
- [California Finalizes Regulations to Strengthen Consumers’ Privacy](https://cppa.ca.gov/announcements/2025/20250923.html), California Privacy Protection Agency, September 23, 2025.
- [Civil Rights Council Secures Approval for Regulations to Protect Against Employment Discrimination Related to Artificial Intelligence](https://calcivilrights.ca.gov/2025/06/30/civil-rights-council-secures-approval-for-regulations-to-protect-against-employment-discrimination-related-to-artificial-intelligence/), California Civil Rights Department, June 30, 2025.
- [SB-947 Employment: automated decision systems (Chapter 859, Statutes of 2026)](https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=202520260SB947), California Legislative Information, 2026.

## Common questions

**Does NYC Local Law 144 apply to remote jobs?**

It can. DCWP's FAQ treats use of an AEDT as in the city if the job is located at a New York City office at least part time, if the job is fully remote but the location associated with it is a New York City office, or if the employment agency using the tool is located in the city. Notice is owed only to candidates and employees who reside in the city.

**What does an NYC bias audit have to include?**

An independent auditor must calculate selection rates, or scoring rates for tools that score, and impact ratios separately for sex, race and ethnicity, and intersectional categories, and report how many people fell in an unknown category. It must use historical data unless too little exists for a statistically significant audit, in which case test data may be used. A category under 2% of the data may be excluded from the impact ratio calculations if the summary explains why and still reports its count and rate.

**What are the penalties under Local Law 144?**

Not more than $500 for a first violation and each additional violation on the same day, and $500 to $1,500 for each subsequent violation. Each day a tool is used without a compliant audit or posted summary is a separate violation, and each failure to give a required notice is a separate violation.

**Does a low impact ratio violate Local Law 144?**

No. The law sets no pass or fail threshold and, according to DCWP's FAQ, requires no specific action based on audit results. Federal, state, and city anti-discrimination laws still apply, and the posted audit can be evidence in a claim under them.