Substitute Bill No. 435 introduces comprehensive regulations concerning the use of automated decision-making systems and artificial intelligence (AI) in employment-related processes, set to take effect on October 1, 2026. The bill mandates that deployers of automated systems must disclose their use to applicants and employees, provide written notices about data collection, and inform individuals of their rights, including the option to opt out of data processing. It emphasizes the necessity of human review in employment decisions influenced by automated systems and requires annual bias audits conducted by independent auditors to assess potential discriminatory impacts. The bill also protects employees from retaliation for exercising their rights and establishes that violations will be treated as unfair trade practices, enforceable by the Attorney General.

Additionally, the bill amends existing laws to enhance protections against discrimination based on various personal characteristics and introduces new provisions regarding the treatment of employees affected by domestic violence, sexual assault, or trafficking. It prohibits employers from requesting information related to an individual's reproductive health unless necessary for occupational qualifications and mandates confidentiality regarding victims' statuses. The legislation also requires that unemployment benefit applications inquire whether job loss is linked to AI use, reflecting a commitment to understanding the implications of technology on employment. Overall, the bill aims to create a more equitable work environment while ensuring transparency and accountability in the use of automated decision-making processes.

Statutes affected:
LAB Joint Favorable Substitute: 5-270, 7-467
File No. 365: 5-270, 7-467
JUD Joint Favorable: 5-270, 7-467