New York State Comptroller Thomas P. DiNapoli released an audit on Tuesday criticizing the New York City Department of Consumer and Worker Protection (DCWP) for not effectively enforcing Local Law 144, which regulates the use of artificial intelligence (AI) in employment decisions.
The audit found that DCWP has struggled to identify when employers are not complying with the law, especially in cases where companies do not disclose their use of AI tools or fail to post required bias audits. As a result, job applicants may be unaware that AI is being used to screen them during hiring processes.
“Job seekers deserve a fair and transparent process when they apply for work, and that includes knowing if a company is using artificial intelligence to evaluate their resumes or video interviews, and whether the technology was vetted to eliminate biases,” DiNapoli said. “When New Yorkers have concerns about employers using AI in hiring, it’s not easy to get help. New York City’s Department of Consumer and Worker Protection must do more to ensure that employers follow the law and gives complaints the attention they rightfully deserve.”
Automated Employment Decision Tools (AEDTs), which include any computational process using AI or machine learning to assist or replace decision-making in employment, are intended to make hiring more efficient but can also amplify existing biases. To address these risks, Local Law 144 was passed by the New York City Council in 2021. The law requires employers and employment agencies to conduct annual bias audits on AEDTs, publish results online, and inform job candidates about how these tools will be used.
The audit noted that after initial outreach efforts ended in May 2023, DCWP did not continue public education despite recognizing its importance for effective enforcement. In reviewing compliance with LL144, DCWP checked websites of 32 employers and vendors but found only one likely case of non-compliance. However, auditors from DiNapoli’s office identified significant gaps in this review: their own examination uncovered 17 potential instances where companies were not following the law.
Furthermore, DCWP did not utilize procedures developed by the NYC Office of Technology and Innovation (OTI), even though OTI had agreed to provide technical support as part of its role.
Complaint handling was also highlighted as inadequate. Auditors found that complaints submitted through NYC’s 311 system were often misdirected—of twelve test calls made by auditors seeking help with AEDT-related issues, only three reached DCWP correctly; most were sent instead to the New York State Department of Labor or back to employers themselves.
To improve oversight and complaint handling related to AEDTs under LL144, DiNapoli’s audit issued thirteen recommendations for DCWP action.
While DCWP disagreed with some findings from the audit report, it agreed—at least partially—to implement most recommendations. Agency officials pointed out challenges such as reliance on employer self-reporting for posting bias audits or notifying applicants about AEDT use; without those steps taken by businesses themselves it becomes difficult for regulators like DCWP to track compliance fully. Officials also suggested combining stakeholder education efforts with complaint-based enforcement strategies could enhance adherence among employers.
The full agency response is included within the published audit document.
