New York City is deferring enforcement of its first-in-the-nation regulation of the use of AI-driven hiring tools (Local Law 144 of 2021), which was initially slated to go into effect on January 1, 2023.  This past Friday (December 12), the NYC Department of Consumer and Worker Protection (DCWP) announced that the law would not be enforced until April 15, 2023.  This is a welcome development for corporations across the country that are hastening to interpret and comply with the law’s notice and bias-audit requirements.

Following an initial round of public comments on the law in June 2022, the DCWP had already proposed clarifying regulations in September, and held a public hearing in late October.  Prompted by the high volume of the second round of public comments received in the lead-up to that hearing, the DCWP now plans to hold another public hearing (date TBD), and to hold off on enforcing Local Law 144 until that process is complete. We expect that DCWP will use this additional time and the public hearing to make additional changes to their proposed regulations; we are hopeful that the Department will not reverse course on a number of positive changes seen in the proposed regulations.

In the meantime, companies have an additional 15 weeks to work through the requirements of the law, including the critical question of whether or not their particular use of AI-driven hiring or promotion tools is within the scope of this law, given the significant narrowing envisaged by the proposed clarifying regulations

It is important to note that New York City is not extending the enforcement of the January 1, 2023 effective date, rather, it only deferring enforcement of the law. Nevertheless, because a proceeding to recover any civil penalty authorized by Local Law 144 of 2021 can only be filed within the office of administrative trials and hearings or within the DCWP, and because only the New York City corporation counsel or its designee can seek enforcement of the law in court, it is exceedingly likely that these agencies and entities will respect and abide by the deferral announcement.

Littler Workplace Policy Institute (WPI) will keep readers apprised of current developments.