BILL NUMBER: S1854
SPONSOR: HINCHEY
 
TITLE OF BILL:
An act to amend the labor law, in relation to requiring certain busi-
nesses to conduct artificial intelligence impact assessments; and to
amend the tax law, in relation to establishing a surcharge on certain
corporations that use artificial intelligence or data mining or have
greater than fifteen employees displaced by artificial intelligence
 
PURPOSE:
To require corporations that rely on artificial intelligence for data
mining or replace more than 15 of their employees with artificial intel-
ligence to pay an additional surcharge on their corporate income tax.
Also, to require corporations to produce impact assessments so that the
department of labor can begin to understand the impact of AI on employ-
ees in the private sector.
 
SUMMARY OF PROVISIONS:
Section one names the bill the "New York Workforce Stabilization Act"
Section two adds a new section 201-j to the labor law requiring, before
they utilize AI, all employers in the state with more than 100 employees
to conduct an impact assessment on their use of artificial intelligence
including: the objectives of their use of AI, a summary of the underly-
ing algorithms, computational modes and tools that are used within the
AI, the design and training data used, what data the AI will have access
to, and how many employees they expect to be displaced.
Section three adds a new section 186-h to the tax law to require that
any corporation that has 15 or more employees displaced due to the use
of algorithms, computational models, artificial intelligence techniques,
robotic hardware or a combination of those pay a surcharge of 2% of
their business income base. This section establishes a waiver for this
worker displacement surcharge for certain eligible businesses. It also
requires that any corporation that uses AI for data mining must pay a
surcharge of 2% of their business income base. All money collected from
this surcharge must be paid to the department of labor for worker
retraining programs, workforce development programs or the unemployment
insurance fund.
Section four states the effective date.
 
JUSTIFICATION:
The capabilities of AI have improved rapidly in recent years, promising
to fundamentally alter many industries in New York. Improvements to
generative AI, for example, which can generate texts, images, and other
products in response to text prompts, will reshape how communications,
marketing, graphic design, and countless other industries do business. A
recent Pew Research Center report found that in 2022, 19% of American
workers had jobs that were at high risk of either being automated or
assisted by AI. To gather more information about how corporations in New
York will use AI and how it will impact workers, this bill would require
any corporation in the state that plans to use AI to submit an impact
assessment to the Department of Labor outlining how the technology will
be used, what data was used for the training of the AI, what data the AI
will have access to, and an estimate of the number of employees expected
to be displaced by its use.
By enabling corporations to automate the work performed by many of their
employees, AI could lead to even greater wealth disparity in New York.
New York State has a responsibility to prevent corporations from concen-
trating profits in the hands of the few through the unrestricted use of
AI. Accordingly, this bill would impose an additional 2% corporate
income tax on corporations that use AI for data mining or that displace
15 or more employees through the use of AI To help New Yorkers find
employment in a job market adjusting to the use of AI, the entirety of
the revenue gained through the 2 % surcharge would be used by the
Department of Labor to fund unemployment benefits, workforce develop-
ment, and workforce retraining. Combined with the impact assessments,
this new surcharge will provide a starting point for the State to
confront the challenges that AI will bring to the labor market.
 
LEGISLATIVE HISTORY:
2024 - S.9401 (referred to Labor) / No same-as
 
FISCAL IMPLICATIONS:
To be determined.
 
EFFECTIVE DATE:
This act shall take effect immediately; provided, however, that section
three of this act shall take effect January 1, 2026