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NextGen Magazine


New York City to Regulate Use of AI for Hiring and Promotion

S.J. Steinhardt
Published Date:
May 25, 2023

GettyImages-966248982 Robot Robotics Automation Ai Artificial Intelligence

New York City is ahead of many other jurisdictions in regulating one aspect of artificial intelligence (AI), The New York Times reported.

Hiring and promotion decisions are now governed by rules that the city’s Department of Consumer and Worker Protection adopted last month, for a law that the City Council passed in 2021. Enforcement is  to begin in July.

The law requires companies using AI software in hiring to notify candidates that an automated system is being used and to have independent auditors check the technology annually for bias. Candidates can request and be told what data are being collected and analyzed.

Unsurprisingly for New York City, the law is being criticized by both sides of the debate over AI regulation.

Julia Stoyanovich, an associate professor at New York University and director of its Center for Responsible AI, told the Times that the rules do not go far enough. She is concerned that it has loopholes that may weaken it. “But it’s much better than not having a law,” she said. “And until you try to regulate, you won’t learn how.”

Another critic, Alexandra Givens, president of the Center for Democracy & Technology, a policy and civil rights organization, said to the Times, “What could have been a landmark law was watered down to lose effectiveness” because the law defines an “automated employment decision tool” as technology used “to substantially assist or replace discretionary decision making,” she said. She explained that the rules appear to interpret that term narrowly, meaning that  AI software would require an audit only if it is the lone or primary factor in a hiring decision or it is used to overrule a humann.

On the other side, the Software Alliance, a trade group that includes Microsoft, SAP Software Solutions and Workday, said in a filing this year that the requirement for independent audits of AI was “not feasible” because “the auditing landscape is nascent,” lacking standards and professional oversight bodies, according to the Times.

Yet not all tech companies agree. “We believe we can meet the law and show what good AI looks like,” said Roy Wang, general counsel of Eightfold AI, a Silicon Valley start-up that produces software used to assist hiring managers, the  Times reported. Companies such as his see the requirement as a potential competitive advantage because it proves that their technology expands the pool of job candidates for companies and increases opportunity for workers.