NYC Local Law 144 (Automated Employment Decision Tools): Penalties
Civil penalties, enforcement mechanisms, and the structure of liability under this law.
Penalties and enforcement
Enforcement structure
NYC Local Law 144 (Automated Employment Decision Tools) is enforced by the New York City authority designated in the statute (typically the state Attorney General). Most U.S. state AI laws use civil enforcement with per-violation penalties; some include cure periods after notice.
For exposure scenario modeling across multiple applicable laws, use the Penalty Calculator.
Last verified: 2026-05-19
NYC Local Law 144 penalty exposure model
NYC Local Law 144 penalty exposure turns on how DCWP counts an AEDT violation: first-day violations are capped differently from later violations, daily use can compound, and missing notices can create separate counts.
How NYC Local Law 144 counts AEDT violations
Administrative Code § 20-872 sets a civil penalty of not more than $500 for a first violation and each additional violation occurring on the same day as the first violation, then $500 to $1,500 for each subsequent violation.
The same section makes each day of unlawful AEDT use a separate violation of § 20-871(a). It also treats each failure to provide a required candidate or employee notice under § 20-871(b)(1)-(3) as a separate violation.
NYC Local Law 144 penalty scenarios
A single unaudited AEDT used continuously for hiring or promotion can therefore compound by day even before counting candidate-specific notice failures. The table below models only the daily-use violation path, so it is a conservative planning floor rather than a worst-case candidate-volume model.
Notice failures can add a separate violation count for each candidate or employee who should have received the required AEDT notice, job-characteristics disclosure, or data-retention/data-source information.
DCWP enforcement and complaint path
DCWP states that employers and employment agencies may be reported for using an AEDT without the required bias audit, without posting a bias-audit summary, or without giving required notices. The agency began enforcement of the law and rule on July 5, 2023.
The law allows the corporation counsel or a designated enforcement official to bring an action or proceeding for correction of a violation, mandatory compliance, or other appropriate relief. Local Law 144 also preserves candidate and employee rights under other laws rather than replacing them.
Controls that reduce penalty exposure
The shortest path to reducing penalty exposure is evidence-first: keep the independent bias audit current, post the required summary before AEDT use, keep the summary available for at least six months after last use, and preserve a timestamped notice path at least 10 business days before use.
For vendor-managed AEDTs, employers should keep an internal file showing the distribution date, audit date, data source, selection or scoring rates, impact ratios, notice copy, and the URL where public results are posted. Those artifacts map directly to the items DCWP and the final rule identify.
Penalty exposure table
Daily-use-only model for one AEDT used without satisfying § 20-871(a); candidate-notice failures can add separate counts.
| Scenario | Calculation | Maximum exposure |
|---|---|---|
| First day of unlawful use | $500 first violation | $500 |
| 7 calendar days of continuous unlawful use | $500 + 6 x $1,500 | $9,500 |
| 30 calendar days of continuous unlawful use | $500 + 29 x $1,500 | $44,000 |
| 90 calendar days of continuous unlawful use | $500 + 89 x $1,500 | $134,000 |
| 365 calendar days of continuous unlawful use | $500 + 364 x $1,500 | $546,500 |
Primary sources
- NYC DCWP AEDT enforcement page (retrieved 2026-05-19)
- Local Law 144 of 2021 text, Admin. Code §§ 20-870 to 20-874 (retrieved 2026-05-19)
- DCWP Final Rule, 6 RCNY §§ 5-300 to 5-304 (retrieved 2026-05-19)
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