New York Passes Two Laws Protecting Employee Privacy – Privacy
United States: New York Passes Two Laws Protecting Employee Privacy
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The New York City and State governments have each recently passed laws to protect employee privacy – one law addressing the use of automated decision-making tools in job interviews. hiring and promotions, and the other on electronic monitoring of employee communications.
Automated hiring decision tools
New York has passed legislation to combat the use of automated decision-making tools in hiring and promotion decisions. Effective January 2, 2023, the law will require New York City employers or employment agencies to conduct a bias audit before using an automated employment decision tool to screen job applicants or evaluate employees for promotions.
This law is part of a growing effort to prevent bias when using automated employment decision tools. Similar legislation has been passed in Illinois and Maryland, where employers who rely on artificial intelligence or facial recognition technology to analyze a job applicant’s video interview must first provide advance notice and obtain consent. Additionally, the U.S. Equal Employment Opportunity Commission launched an initiative in October 2021 to gather information on the use and impact of employment-related technologies and publish technical guidance on the algorithmic fairness.
What is an Automated Job Decision Tool?
Under the new law, a tool will be classified as an “automated employment decision tool” if a computing process – derived from machine learning, statistical monitoring, data analysis or intelligence artificial – issues a score, classification, or recommendation that is used to either substantially aid or replace discretionary decision-making in hiring decisions. In practice, this will likely apply to any software or algorithm used to screen and screen applicants and employees, including those used to screen resumes, screen skills, rank applicants, or assess any other objective characteristics of applicants. It will also apply to employee productivity and performance assessment tools, tracking software and compensation analysis platforms.
What should employers and employment agencies do?
The law imposes certain notice requirements on applicants for employment and employees residing in New York. At least 10 business days prior to using the tool, applicants or employees should be notified of the following:
- An automated employment decision tool is used as part of the assessment, and the candidate or employee has the right to request an alternate selection process or accommodation.
- The tool will reference a specified list of job qualifications and characteristics when assessing the candidate or employee.
- Within 30 days of a candidate or employee’s written request, an employer or agency must provide information about the types of data collected for the tool, the source of the data, and the data retention policy. Alternatively, this information may be posted on the employer’s or agency’s website.
In addition, employers should conduct an independent bias audit of any automated employment decision tool no later than one year prior to the tool’s use to assess the tool’s disparate impact on individuals in any Federal EEO-1 “Category 1” (i.e., whether the tool would have a disparate impact on individuals based on their race, ethnicity, or gender) . A summary of the most recent audit, along with the release date of the tool to which the audit applies, should be available on the employer’s or agency’s website prior to use.
What are the penalties for breaking the law?
The first violation will result in a civil penalty of up to $500. Each use of the tool on the same day as the first violation will be treated as a new violation with a penalty not exceeding $500. All subsequent violations are subject to a civil penalty of not less than $500 and not more than $1,500. Each day the tool is used in violation of the law is treated as a separate violation.
Additionally, each failure to provide any of the three notification requirements will be treated as a separate violation.
Electronic employee monitoring
New York State has passed legislation on electronic surveillance of employee communications. Effective May 7, 2022, the law will require employers with a place of business in New York State who engage in electronic monitoring of employee communications to notify employees of the monitoring.
What forms of communication does it apply to?
The law covers the monitoring of employees’ telephone communications, emails, or Internet access or use by any electronic device or system. The law does not apply to surveillance that is for maintenance or protection purposes only.
What should employers do?
Employers must provide written notice of such monitoring when hiring any employee. The notice must explain that all telephone conversations or transmissions, emails or transmissions, or an employee’s access to or use of the Internet through any electronic device or system are monitored. The written notice must be in electronic form and acknowledged by the employee in writing or electronically. In addition, the notice must be posted in a conspicuous and visible place.
What are the penalties for breaking the law?
Employers will receive a civil penalty of $500 for a first violation. Subsequent violations will result in higher penalties: $1,000 for a second violation and $3,000 for a third violation.
The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.
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