By Ty Hyderally Esq. and Jamie Davila, Esq.

January 17, 2025

The rise and usage of automated technologies (AI) has proven to become an integral part of the decision-making process previously reserved for humans. One of the most popular uses of AI in the work world, has been with companies using AI to screen and select applicants for employment.  Companies use tools that rely upon various algorithms that can quickly sift through numerous applicants and their resumes to determine who should be sent an acceptance letter and who should be sent a rejection letter.  Companies use AI tools and algorithm parameters to help sort and prioritize certain applicants whom the company is seeking.  One would hope – and expect- that AI is used in a legitimate fashion to select the very best applicants with the best resumes, blind to discriminatory factors such as race, age, disability, and gender, to name a few.  One would hope that decisions are made based upon the applicant’s experience or lack thereof, using certain key phrases or words.  However, there are absolutely nefarious purposes that AI can be used to support in the selection process.  AI can certainly be used to select a certain gender, a certain race, a certain age group, people without medical complications or disabilities, etc. In fact, the method of selection and filtering candidates, using AI, is often referred to as Algorithmic discrimination.  Algorithmic discrimination is the use of AI and automated decision-making tools that give rise to bias and discrimination.

On January 9, 2025, the Attorney General of New Jersey released a statement explaining how the New Jersey Law Against Discrimination (LAD) applies to discrimination stemming from the use of advanced technology.[1] The guide explains that the usage of automated decision-making tools may produce unequal outcomes resulting in impact discrimination, differential treatment discrimination, or the failure to provide or account for reasonable accommodations, if the AI technology is not meticulously evaluated, designed or tested. It is further clarified that regulated entities may be liable for algorithmic discrimination resulting from the use of automated decision-making tools, even if the tools were developed by a third party.

The Attorney General’s directive was clear that companies could not hide behind third party applications.  If the tool the company was using was found to be discriminatory, the company can be held liable, regardless of whether the tool was developed by an outside third party.  The statement takes note of the fact that AI technology can be used to aid in or make a decision that can cause disproportionate harm to certain communities.  In those situations, the AI technology and the company implementing that technology are absolutely at risk of being non-compliant with the Law Against Discrimination in New Jersey.

Following the recommendations made by the New Jersey AI Task Force, inquiries into potential bias should be viewed as whether they are compliant with current executive orders, security and privacy policies and the law, including the Law Against Discrimination.[2]

The Law Against Discrimination prohibits discrimination and bias-based harassment in employment, housing, places or public accommodation, credit, and contracting on the basis of actual or perceived race, religion, color, national origin, ancestry, sex, gender identity or expression, sexual orientation, disability, and other protected characteristics.[3] This guidance highlights how current civil rights law apply to the full range of AI applications;[4] including: employment, housing, places of public accommodation, credit, and contracting. The guidance clarifies that entities may still be liable for violating the Law Against Discrimination, even if there was no intention to discriminate. [5] Therefore, it is important to use AI technology responsibly and be conscientious of the disparate outcomes it may produce as the cost of efficiency and convenience does not outweigh its effect on disproportionate communities and the resulting liability under the law.

En nuestra firma hablamos español. This blog is for informational purposes only. It does not constitute legal advice and may not reasonably be relied upon as such. If you face a legal issue, you should consult a qualified attorney for independent legal advice regarding your particular set of facts. This blog may constitute attorney advertising. This blog is not intended to communicate with anyone in a state or other jurisdiction where such a blog may fail to comply with all laws and ethical rules of that state or jurisdiction.

[1] Mathre J. Platkin, Sundeep Lyer, New Guidance Explains How Civil Rights Law Apply to Advanced Technologies; Civil Rights Innovation Lab Will Leverage Technology to Protect Civil Rights (Jan. 15, 2025),  https://www.njoag.gov/attorney-general-platkin-and-division-on-civil-rights-announce-new-guidance-on-algorithmic-discrimination-creation-of-civil-rights-innovation-lab/.

[2] Report to the Governor on Artificial Intelligence (Jan. 15, 2025)  https://innovation.nj.gov/news/NJ-AI-Task-Force-Report.pdf pg. 46.

[3] Id.

[4] Id. At pg. 61.

[5] Joseph J. Lazzarotti, Jason C. Gavejian, New Jersey Attorney Genera: NJ’s Law Against Discrimination (LAD) Applies to Automated Decision- Making Tools (Jan. 15, 2025) https://natlawreview.com/article/new-jersey-attorney-general-njs-law-against-discrimination-lad-applies-automated.