Legal Roadblock For Automation In New York City

When we contemplate how far automation has come in the last ten years, we usually visualize big cities. New York, Los Angeles, even Seattle. These are the places where technology has been meaningfully developed or implemented in a way the public can see and experience. But local and state governments have long considered stricter regulations to determine what businesses can and cannot do. NYC recently experienced a legal setback in automation. Here’s why.

Specifically, the tools many employers use to streamline the hiring process are automated. They are based on algorithms that help them decide who deserves to be there and who does not. But research suggests those algorithms might be biased against people of color. This has resulted in state and local governments to reconsider whether they should be legal.

A new NYC law due to go into effect on January 1, 2023 will prohibit employers from using these systems during the hiring process.

The law states that an employer cannot use an “automated employment decision tool” to sift through prospective employees. There are exceptions. If the tool has been put through a bias audit within the last 12 months, it may still be used. More importantly, the results of that audit have to be published to the employer’s website and made available to the public before the systems can be used again. 

Automated employment decision tools are defined in the legislations as “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.” 

Excluded tools include those that do “not automate, support, substantially assist or replace discretionary decision-making processes and that does not materially impact natural persons, including, but not limited to, a junk email filter, firewall, antivirus software, calculator, spreadsheet, database, data set, or other compilation of data.”

Penalties for each violation of the new law will include a $500 fine. Additional violations will result in much steeper fines.

Will your business or employees be affected by new automation legislation or employment laws in New York? Check here for more information: www.woodslaw.com

Laws like these are cropping up all over the country while businesses implement ever more powerful automation processes. Only a short distance away in New Jersey, company NICE announced new AI software that will use Robotic Process Automation (RPA) that businesses can use to make tasks easier. 

President Barry Cooper of the NICE Workforce and Customer Experience Group tweeted, “The digital age is powering productivity, improving service experiences, and accelerating ROI. By digitizing processes and prioritizing automations that drive maximum business value, our latest RPA capabilities are accelerating the path to a digital-first strategy.”

New applications include click-to-document, ROI-based automation process recommendation, and a built-in resource center. Like all automation, these applications seek to reduce the number of — or eliminate — hourly expenditure by employees to save businesses money.

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