What Is an AEDT? NYC Local Law 144 Explained for Recruiters

If you're recruiting in New York City, there's a law that's changing how you can use hiring technology. NYC Local Law 144 puts new rules on automated employment decision tools. And yes, this affects your day-to-day recruiting work. The law says you can't use these tools unless they have been subject to an independent bias audit before use and within the past year. Sounds complicated? Let's break it down.

What's an AEDT?

AEDT means Automated Employment Decision Tool. Think of it as any software that uses machine learning, statistical modelling, data analytics, or AI to produce a simplified output (like a score, classification, or recommendation) and substantially assists or replaces human decision-making in hiring. Here's the key part - not every recruiting tool counts as an AEDT. The law only cares about tools that substantially help or replace human decision-making in hiring.

What does count as an AEDT:

Software that ranks job candidates.
Systems that automatically screen resumes and give scores.
AI tools that filter applications based on criteria.
Video interview platforms that analyse what candidates say or how they look.
Personality tests when used to make hiring decisions and when they produce simplified outputs used in decisions.

What doesn't count:

Basic applicant tracking systems.
Tools that just search resume databases.
Software you use to reach out to potential candidates.
Systems that only collect applications.
The difference matters because only the first group needs to follow these new rules.

Who Has to Follow This Law?

This law applies to you if you're hiring for jobs “in the city” (i.e., positions located in NYC, including certain fully remote roles associated with a NYC office). Doesn't matter where your company is located - if the position is in New York City (even part-time), you need to comply. Employment agencies face the same rules if they work with NYC positions. Here's where it gets tricky with remote work. If you have remote employees who are technically tied to a NYC office, this law still applies to you. Candidate notice is required for candidates who reside in NYC.

The Bias Audit Thing Explained

A bias audit is basically having someone independent check if your hiring tool discriminates against certain groups of people. Right now, the audit has to look for bias based on race, ethnicity, and sex. But it also needs to check combinations - like how the tool treats Black women specifically, not just Black people or women separately. You can't audit your own tools. Has to be someone independent who doesn't work for your company and is not involved in developing or using the tool. And you need to do this every single year and before you use the tool.

Here's what happens during an audit:

An outside expert tests your tool.
They check if it's biased against protected groups.
You get a report showing the results.
Those results become public (yes, anyone can see them) via a summary posted on your website that includes selection/scoring rates, impact ratios, and the tool’s distribution date.
While the law doesn't require specific remedial actions based on audit results, you must still comply with all relevant federal, state, and NYC anti-discrimination laws.

You Have to Tell Candidates What You're Doing

The law requires you to be upfront with job candidates about using these tools. You need to give candidates at least 10 business days' notice before using an AEDT to evaluate them (for candidates who reside in NYC).

Your notice needs to explain:

That you're using automated tools to evaluate them.
What job qualifications the tool is checking (or other characteristics the tool evaluates).
What kind of data you’re collecting about them and the source of that data (posted on your site or provided upon written request within 30 days).
How long you keep their data (posted or provided upon request, per the rule).
How they can request a different evaluation process or a reasonable accommodation if they want.
This transparency rule exists because candidates deserve to know when algorithms are making decisions about their careers.

What Happens If You Don't Follow the Rules?

NYC takes this seriously. The Department of Consumer and Worker Protection handles violations, and they can fine you $500 for a first violation (and each additional violation on the same day) and $500–$1,500 for subsequent violations; each day of noncompliance and each failure to provide required notice can count separately.
But money isn't the only risk. When your bias audit results go public and show problems, it hurts your company's reputation. Candidates might not trust you if you're not following these transparency rules. The enforcement began on July 5, 2023, after multiple delays from the original January 1, 2023, effective date. You can't claim you didn't know about it.

Common Mistakes Recruiters Make

Many people think every piece of hiring software needs an audit. That's not true. The question you need to ask is: does this tool substantially help make hiring decisions? Your basic ATS that just organizes applications? Probably not an AEDT. That sourcing tool you use to find candidates on LinkedIn. Also, probably fine. But that resume screening software that gives candidates scores? That likely needs an audit. Another mistake - thinking you're off the hook because a vendor provides the tool. Wrong. If you use it to make hiring decisions in NYC, you're responsible for compliance (even if a vendor helps arrange an audit).

How TeamFill Fits into This

When you're looking at AI interview software, you need to think about compliance. TeamFill offers interactive interviews. The virtual interviewer asks your predefined questions and follows up with clarifying questions if responses seem incomplete. This kind of system can give you deeper insights into candidates' skills and experience while maintaining consistent evaluation standards. But like any tool that substantially assists hiring decisions, you'll want to work with your legal team to figure out if it needs a bias audit for your NYC positions.

Getting Compliant - Step by Step

Start by making a list of every tool you use in hiring. Not just the obvious ones - include anything that influences who gets hired.

For each tool, ask yourself:

Does this help me make hiring decisions?
Does it rank, score, or evaluate candidates?
Do I use it for NYC jobs?
If you answered yes to all three, you probably need a bias audit.
Next, find someone qualified to do the audit. They can't have any business relationship with your company that might create a conflict of interest. They need to understand both the technical side of your tools and what the law requires.
Set up your candidate notification process. Create simple, clear messages that explain how you use automated tools. Train your recruiting team on when and how to send these notifications.

Timing Your Audits

You need to complete bias audits every 12 months. That means planning ahead - these audits don't happen overnight.

Think about timing:

Audits take weeks or months to complete. Results must be published before you can use the tool. You might need time to fix problems the audit finds. Your team needs training on any new processes. Don't wait until the last minute. Schedule your next audit well before your current one expires, or you might have to stop using your tools.

Real-World Impact on Recruiting Teams

Let's talk about what this actually means for your day-to-day work. Many recruiting teams had to completely rethink their hiring processes when this law kicked in. Some companies discovered they were using way more automated tools than they realized. That personality assessment you've been using for years. Might need an audit. That AI-powered resume screener that saves you hours? Definitely needs one. The notification requirement changes how you talk to candidates too. You can't just spring an automated assessment on someone during the interview process. You need to tell them upfront, which means planning your hiring timeline differently. Here's what some recruiting teams learned the hard way: candidates have mixed reactions to these notifications. Some appreciate the transparency. Others get nervous about being evaluated by algorithms. You'll need to train your team on how to handle these conversations.

Industry Changes and Vendor Responses

The law pushed many HR tech vendors to get their tools audited proactively. Smart move on their part - it makes sales easier when they can show compliant audit results upfront. But here's the catch: just because a vendor has an audit doesn't mean you're automatically compliant. The audit results need to be recent (within 12 months) and the tool needs to be used the same way it was tested. Some vendors started offering "NYC-compliant" versions of their tools. Others built in features to help with candidate notifications. A few even created audit management dashboards to help track compliance deadlines. If you're shopping for new hiring tools, ask vendors about their audit status and compliance support. It'll save you headaches later.

What's Coming Next

NYC was first in the US to pass this kind of law, but other places are watching. California, Illinois, and other states are looking at similar rules.
If you hire in multiple states, get ready for more compliance requirements. The types of bias audits might expand beyond race, ethnicity, and sex to include age, disability, or other characteristics.
Technology changes faster than laws do. New AI capabilities will challenge how we define AEDTs. Stay on top of regulatory updates so you don't get caught off guard.

Final Words

NYC Local Law 144 changes how you can use hiring technology in the city. If your tools substantially assist hiring decisions for NYC positions, you need annual bias audits and must notify candidates who are NYC residents at least 10 business days in advance.

Don't wait until you're scrambling to comply. Make your list of tools, schedule audits, and set up notification processes now. The goal isn't to stop you from using technology - it's to make sure that technology doesn't unfairly discriminate against candidates.

The bottom line? This law isn't going anywhere, and similar regulations are spreading. Companies that get ahead of compliance now will have a competitive advantage when hiring top talent in major markets.