The NYC Local Law 144 bias-audit checklist: what the audit requires

For employers covered by NYC Local Law 144, verified at source. About 5 minutes.

What a compliant bias audit actually contains

Three pieces have to be right: who runs it, what it measures, and what data it uses.

An independent auditor. The auditor must be able to exercise objective, impartial judgment. Under the adopted rule (section 5-300), a person is not independent if they were involved in using, developing, or distributing the tool, if they have an employment relationship with the employer, agency, or the vendor at any point during the audit, or if they hold a direct or material indirect financial interest in any of them. An internal team that helped roll out the tool cannot audit it.

The right calculations. For a tool that selects or classifies, the audit must calculate the selection rate and the impact ratio for each category, computed separately for sex categories, race and ethnicity categories, and the intersectional categories of the two (section 5-301). For a tool that scores, it works from the median score and scoring rates instead. Two points trip people up: the categories are the federal EEO-1 Component 1 categories, not a list you choose, and the intersectional dimension is required, not optional. The audit must also report how many people fell into an unknown category.

The right data. The audit must use historical data from actual use of the tool (section 5-302). You may rely on an audit built on other employers' historical data only if you contributed your own use data or have never used the tool. Test data is allowed only when there is not enough historical data for a statistically significant audit, and then the published summary has to explain why historical data was not used. A long-time user with its own significant data cannot fall back to test data.

What you must publish, and what you must tell candidates

Publish the results before you use the tool. On the employment section of your website, in a clear and conspicuous way, post the date of the most recent audit and a summary of results: the source and explanation of the data, the number of people in the unknown category, the number of applicants or candidates, the selection or scoring rates, and the impact ratios for all categories, plus the tool's distribution date (section 5-303). A clearly labeled link to a page carrying the summary is acceptable, and you keep it posted for at least six months after your latest use of the tool.

Give notice at least ten business days before use. Tell candidates and employees who reside in New York City that an automated tool will be used, through your website, the job posting, or direct mail or email (section 5-304). The notice must include instructions on how to request an alternative selection process or an accommodation. Note the limit here: the law requires the instructions, but it does not require you to actually provide an alternative process. You also disclose the job qualifications the tool assesses, and, on written request, the type, source, and retention of the data, answered within thirty days.

Keeping it current, and where teams slip

The most common failure is treating the audit as one and done. The rule bars using or continuing to use a tool if more than one year has passed since its most recent audit (section 5-301), so this is a recurring obligation, not a launch task. The second is assuming a New York bias audit covers your EU work, or the reverse. It does not. A Local Law 144 audit is a narrow statistical snapshot of disparate impact. It is not the risk classification, documentation, human oversight, and ongoing monitoring that an EU AI Act high-risk hiring program demands, and an EU program does not automatically produce New York's public summary or ten-day notice.

The exposure for getting it wrong is cumulative. Penalties run up to 500 dollars on the first day and 500 to 1,500 dollars for each day after, with each day of non-compliant use and each missing notice treated as a separate violation (section 20-872). The law has been enforced since 5 July 2023.

Turn the checklist into your own files

Knowing the steps is the start. Doing them means an evidence trail an auditor can follow. Before that, a two-minute check tells you whether your tools are in scope and where to begin.

Not sure the law applies to you yet? Start with whether you are covered by Local Law 144. For the annual clock that catches teams off guard, read when a bias audit expires.

This is educational material and a starting point, not legal advice. New York City's Local Law 144 has its own rules and exceptions, and the rule's details matter for your specific tools and data. For how it applies to your situation, consult a qualified employment lawyer. Signato is not a law firm and does not certify compliance.