New York City to Require Salary Ranges in Job Listings, Audits of AI Hiring Tools
Author: Michael Cardman, XpertHR Legal Editor
January 14, 2022
New York City employers will soon be required to:
- List the minimum and maximum salary for any job, promotion or transfer opportunity they advertise; and
- Conduct annual bias audits of automated tools used to screen candidates for hire or for other employment decisions.
Salary Ranges Required for Job Listings
A new law enacted last week and projected to take effect in mid-May makes it a violation of New York City's discrimination law to omit salary ranges from advertisements, for which employers could be fined up to $125,000 (or $250,000 for a malicious violation) among other remedies.
The salary range may extend from the lowest to the highest salary the employer in good faith believes at the time of the posting it would pay. The law would not apply to advertisements for temporary employment at a temporary help firm.
It remains to be seen whether the law applies to all jobs advertised in New York City or only to jobs physically located in New York City, and whether salary ranges are expected for hourly positions. The New York City Commission on Human Rights (NYCCHR) is expected to issue rules to clarify the requirement.
New York City joins several other states that have passed similar wage transparency laws, including:
- California,
- Colorado and
- Massachusetts.
"It is long overdue that New York City address the cause of significant inequity in the local hiring process: employers' refusal to disclose a position's salary," New York City Councilwoman Helen Rosenthal, the law's primary sponsor, said in a statement. "Forcing employers to disclose salary ranges for available positions will also help us to more readily identify systemic pay inequities."
"This smacks as something someone who never has run a business would support, and is an unnecessary interference in a contract negotiation," responded Councilman Joe Borelli, one of the seven City Council members who voted against the law.
Annual Bias Audits Required for 'Automated Employment Decision Tools'
Another bill, which takes effect January 1, 2023, will prohibit New York City employers from using an automated employment decision tool unless they:
- Have had an independent auditor conduct an impartial audit of the tool to assess whether it has a disparate impact on persons of any category required to be reported in the federal EEO-1 Report Component 1 no more than one year before using the tool;
- Post on their website (or on the website of their employment agency) a summary of the most recent audit's results and the distribution date of the tool; and
- Notify each employee or candidate who resides in New York City and who has applied for a position or for an employment decision about certain information concerning the use of the tool.
An automated employment decision tool is defined 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." It does not include things like junk email filters, firewalls, antivirus software, calculators, spreadsheets, databases or other compilations of data.
Employers that violate this law will be subject to civil penalties of up to $1,500 per day.
"With a dramatic increase in working remotely, the use of automated employment decision tools is more pronounced than ever," Councilman Robert Holden said at a November hearing on the bill. "Many companies readily use such tools to scan resumes for keywords and assess candidates' public profiles for indicators of certain personality traits. They can also scan video interviews to evaluate the [candidates'] behaviors and mannerisms for indicators of professionalism and characteristics that are beneficial to the position."