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NYC’s anti-bias law for hiring algorithms goes into effect

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Summary

New York City has begun enforcing a law that requires employers using algorithms to recruit, hire or promote employees to submit those algorithms for an independent audit and make the results public. It also mandates that companies using these types of algorithms make disclosures to employees or job candidates. The law extends beyond NYC-based workers and there is evidence of bias seeping into hiring algorithms. Despite the risks, adoption of AI for hiring processes is still increasing. The industry is attempting to self-regulate, but the law is seen as inadequate by some. The success of its implementation will affect laws to come elsewhere as other states are considering similar regulations.

Q&As

What is Local Law 144 and why was it created?
Local Law 144 is a law in New York City that requires employers using algorithms to recruit, hire or promote employees to submit those algorithms for an independent audit and make the results public. It also mandates that companies using these types of algorithms make disclosures to employees or job candidates. It was created to prevent discrimination in hiring.

What measures must companies take to comply with Local Law 144?
Companies must submit their algorithms for an independent audit and make the results public. They must also list the algorithms they’re using as well an an “average score” candidates of different races, ethnicities and genders are likely to receive from the said algorithms — in the form of a score, classification or recommendation. They must also list the algorithms’ “impact ratios,” which the law defines as the average algorithm-given score of all people in a specific category (e.g., Black male candidates) divided by the average score of people in the highest-scoring category.

What evidence is there of bias seeping into hiring algorithms?
Amazon scrapped a recruiting engine in 2018 after it was found to descriminate against women candidates. A 2019 academic study showed AI-enabled anti-Black bias in recruiting. Algorithms have been found to assign job candidates different scores based on criteria like whether they wear glasses or a headscarf; penalize applicants for having a Black-sounding name, mentioning a women’s college, or submitting their resume using certain file types; and disadvantage people who have a physical disability that limits their ability to interact with a keyboard.

What forms of algorithms are employers using in their hiring processes?
Some of the more common algorithms used in hiring processes are text analyzers that sort resumes and cover letters based on keywords. There are also chatbots that conduct online interviews to screen out applicants with certain traits, and interviewing software designed to predict a candidate’s problem solving skills, aptitudes and “cultural fit” from their speech patterns and facial expressions.

What are some efforts being taken to self-regulate the use of AI in hiring processes?
The Data & Trust Alliance was launched in December 2021 and aims to develop an evaluation and scoring system for AI to detect and combat algorithmic bias, particularly bias in hiring. Companies are also encouraged to exercise caution when using AI in hiring processes.

AI Comments

👍 This article highlights the important and overdue legislation enacted by New York City to ensure that algorithms used in hiring processes are not biased. It is encouraging to see that other states, such as California and New Jersey, are also introducing laws to regulate the use of AI in hiring decisions.

👎 This article fails to address the fact that many companies are already using AI to support their hiring processes, despite the potential for bias and discrimination. Furthermore, the scope of the law does not cover all hiring algorithms, leaving some workers vulnerable to bias.

AI Discussion

Me: It's about a new law in New York City that requires employers using algorithms to recruit, hire or promote employees to submit those algorithms for an independent audit and make the results public. It also mandates that companies using these types of algorithms make disclosures to employees or job candidates about the algorithms and their potential impacts.

Friend: That's interesting. What are the implications of this law?

Me: Well, this law is the first of its kind in the country, and it extends beyond NYC-based workers, so it could set a precedent for other cities and states to follow. It could also help reduce algorithmic bias in hiring, as it mandates that employers take steps to ensure their algorithms are fair and unbiased. On the other hand, some people are concerned that the law doesn't go far enough to address the issue of algorithmic bias, and that companies should be doing more to self-regulate. Overall, this law could be a good step forward in combatting algorithmic bias in hiring, but there's still a lot of work to be done.

Action items

Research the laws in your state or city regarding the use of algorithms in hiring decisions.
If your organization is using algorithms in hiring decisions, ensure that the algorithms are compliant with any applicable laws and regulations.
Consider joining the Data & Trust Alliance to help develop an evaluation and scoring system for AI to detect and combat algorithmic bias.

Technical terms

Algorithm: A set of instructions or rules used to solve a problem or complete a task.
Audit: An independent review of a company's financial records or practices.
Bias: Prejudice in favor of or against one thing, person, or group compared with another, usually in a way considered to be unfair.
Disclosure: The act of making information known or public.
Recruitment: The process of finding and hiring suitable candidates for a job.
AI: Artificial intelligence, a branch of computer science dealing with the simulation of intelligent behavior in computers.