In response to the revocation of federal AI policies, state legislatures are addressing AI-related bias in employment, particularly through legislation regulating automated decision systems (ADS). New Jersey’s Division of Civil Rights issued guidance on algorithmic discrimination in January 2025. Meanwhile, New York’s proposed AI Act and California’s “No Robo Bosses Act” aim to enhance scrutiny of ADS, requiring human oversight and allowing for private lawsuits against firms mishandling AI tools. Algorithmic discrimination, where algorithms unfairly disadvantage individuals based on protected traits, is the focal point of these laws. The ongoing Mobley v. Workday, Inc. case highlights potential class actions against AI systems that disproportionately affect older applicants, raising significant legal implications. Employers must evaluate their AI policies to mitigate bias and ensure compliance with existing and upcoming regulations, safeguarding against legal repercussions and reputational damage in a continuously evolving landscape.
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