This month, the New Jersey Attorney General’s office (NJAG) added to nationwide efforts to regulate, or at least clarify the application of existing law, in this case the NJ Law Against Discrimination, N.J.S.A. § 10:5-1 et seq. (LAD), to artificial intelligence technologies. In short, the NJAG’s guidance states:

the LAD applies to algorithmic discrimination in the same way it has long applied to other discriminatory conduct.  

If you are not familiar with it, the LAD generally applies to employers, housing providers, places of public accommodation, and certain other entities. The law prohibits discrimination on the basis of actual or perceived race, religion, color, national origin, sexual orientation, pregnancy, breastfeeding, sex, gender identity, gender expression, disability, and other protected characteristics. According to the NJAG’s guidance, the LAD protections extend to algorithmic discrimination (discrimination that results from the use of automated decision-making tools) in employment, housing, places of public accommodation, credit, and contracting.

Citing a recent Rutgers survey, the NJAG pointed to high levels of adoption of AI tools by NJ employers. According to the survey, 63% of NJ employers use one or more tools to recruit job applicants and/or make hiring decisions. These AI tools are broadly defined in the guidance to include:

any technological tool, including but not limited to, a software tool, system, or process that is used to automate all or part of the human decision-making process…such as generative AI, machine-learning models, traditional statistical tools, and decision trees.

The NJAG guidance examines some ways that AI tools may contribute to discriminatory outcomes.

  • Design. Here, the choices a developer makes in designing an AI tool could, purposefully or inadvertently, result in unlawful discrimination. The results can be influenced by the output the tool provides, the model or algorithms the tool uses, and what inputs the tool assesses which can introduce bias into the automated decision-making tool.
  • Training. As AI tools need to be trained to learn the intended correlations or rules relating to their objectives, the datasets used for such training may contain biases or institutional and systemic inequities that can affect the outcome. Thus, the datasets used in training can drive unlawful discrimination.
  • Deployment. The NJAG also observed that AI tools could be used to purposely discriminate, or to make decisions for which the tool was not designed. These and other deployment issues could lead to bias and unlawful discrimination.

The NJAG notes that its guidance does not impose any new or additional requirements that are not included in the LAD, nor does it establish any rights or obligations for any person beyond what exists under the LAD. However, the guidance makes clear that covered entities can violate the LAD even if they have no intent to discriminate (or do not understand the inner workings of the tool) and, just as noted by the EEOC in guidance the federal agency issued under Title VII, even if a third-party was responsible for developing the AI tool. Importantly, under NJ law, this includes disparate treatment/impact which may result from the design or usage of AI tools.

As we have noted, it is critical for organizations to assess, test, and regularly evaluate the AI tools they seek to deploy in their organizations for many reasons, including to avoid unlawful discrimination. The measures should include working closely with the developers to vet the design and testing of their automated decision-making tools before they are deployed. In fact, the NJAG specifically noted many of these steps as ways organizations may decrease the risk of liability under the LAD. Maintaining a well thought out governance strategy for managing this technology can go a long way to minimizing legal risk, particularly as the law develops in this area.

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Photo of Joseph J. Lazzarotti Joseph J. Lazzarotti

Joseph J. Lazzarotti is a principal in the Tampa, Florida, office of Jackson Lewis P.C. He founded and currently co-leads the firm’s Privacy, Data and Cybersecurity practice group, edits the firm’s Privacy Blog, and is a Certified Information Privacy Professional (CIPP) with the…

Joseph J. Lazzarotti is a principal in the Tampa, Florida, office of Jackson Lewis P.C. He founded and currently co-leads the firm’s Privacy, Data and Cybersecurity practice group, edits the firm’s Privacy Blog, and is a Certified Information Privacy Professional (CIPP) with the International Association of Privacy Professionals. Trained as an employee benefits lawyer, focused on compliance, Joe also is a member of the firm’s Employee Benefits practice group.

In short, his practice focuses on the matrix of laws governing the privacy, security, and management of data, as well as the impact and regulation of social media. He also counsels companies on compliance, fiduciary, taxation, and administrative matters with respect to employee benefit plans.

Privacy and cybersecurity experience – Joe counsels multinational, national and regional companies in all industries on the broad array of laws, regulations, best practices, and preventive safeguards.

Benefits counseling experience – Joe’s work in the benefits counseling area covers many areas of employee benefits law.

Joe speaks and writes regularly on current employee benefits and data privacy and cybersecurity topics and his work has been published in leading business and legal journals and media outlets, such as The Washington Post, Inside Counsel, Bloomberg, The National Law Journal, Financial Times, Business Insurance, HR Magazine and NPR, as well as the ABA Journal, The American Lawyer, Law360, Bender’s Labor and Employment Bulletin, the Australian Privacy Law Bulletin and the Privacy, and Data Security Law Journal.

Photo of Jason C. Gavejian Jason C. Gavejian

Jason C. Gavejian is a principal in the Berkeley Heights, New Jersey, office of Jackson Lewis P.C. and co-leader of the firm’s Privacy, Data and Cybersecurity practice group. Jason is also a Certified Information Privacy Professional (CIPP/US) with the International Association of Privacy…

Jason C. Gavejian is a principal in the Berkeley Heights, New Jersey, office of Jackson Lewis P.C. and co-leader of the firm’s Privacy, Data and Cybersecurity practice group. Jason is also a Certified Information Privacy Professional (CIPP/US) with the International Association of Privacy Professionals.

As a Certified Information Privacy Professional (CIPP/US), Jason focuses on the matrix of laws governing privacy, security, and management of data. Jason is co-editor of, and a regular contributor to, the firm’s Workplace Privacy, Data Management & Security Report blog.

Jason’s work in the area of privacy and data security includes counseling international, national, and regional companies on the vast array of privacy and security mandates, preventive measures, policies, procedures, and best practices. This includes, but is not limited to, the privacy and security requirements under state, federal, and international law (e.g., HIPAA/HITECH, GDPR, California Consumer Privacy Act (CCPA), FTC Act, ECPA, SCA, GLBA etc.). Jason helps companies in all industries to assess information risk and security as part of the development and implementation of comprehensive data security safeguards including written information security programs (WISP). Additionally, Jason assists companies in analyzing issues related to: electronic communications, social media, electronic signatures (ESIGN/UETA), monitoring and recording (GPS, video, audio, etc.), biometrics, and bring your own device (BYOD) and company owned personally enabled device (COPE) programs, including policies and procedures to address same. He regularly advises clients on compliance issues under the Telephone Consumer Protection Act (TCPA) and has represented clients in suits, including class actions, brought in various jurisdictions throughout the country under the TCPA.

Jason represents companies with respect to inquiries from the HHS/OCR, state attorneys general, and other agencies alleging wrongful disclosure of personal/protected information. He negotiates vendor agreements and other data privacy and security agreements, including business associate agreements. His work in the area of privacy and data security includes counseling and coaching clients through the process of investigating and responding to breaches of the personally identifiable information (PII) or protected health information (PHI) they maintain about consumers, customers, employees, patients, and others, while also assisting clients in implementing policies, practices, and procedures to prevent future data incidents.

Jason represents management exclusively in all aspects of employment litigation, including restrictive covenants, class-actions, harassment, retaliation, discrimination, and wage and hour claims in both federal and state courts. He regularly appears before administrative agencies, including the Equal Employment Opportunity Commission (EEOC), the Office for Civil Rights (OCR), the New Jersey Division of Civil Rights, and the New Jersey Department of Labor. Jason’s practice also focuses on advising/counseling employers regarding daily workplace issues.

Jason’s litigation experience, coupled with his privacy practice, provides him with a unique view of many workplace issues and the impact privacy, data security, and social media may play in actual or threatened lawsuits.

Jason regularly provides training to both executives and employees and regularly speaks on current privacy, data security, monitoring, recording, BYOD/COPE, biometrics (BIPA), social media, TCPA, and information management issues. His views on these topics have been discussed in multiple publications, including the Washington Post, Chicago Tribune, San Francisco Chronicle (SFGATE), National Law Review, Bloomberg BNA, Inc.com, @Law Magazine, Risk and Insurance Magazine, LXBN TV, Business Insurance Magazine, and HR.BLR.com.

Jason is the co-leader of Jackson Lewis’ Hispanic Attorney resource group, a group committed to increasing the firm’s visibility among Hispanic-American and other minority attorneys, as well as mentoring the firm’s attorneys to assist in their training and development. He also previously served on the National Leadership Committee of the Hispanic National Bar Association (HNBA) and regularly volunteers his time for pro bono matters.

Prior to joining Jackson Lewis, Jason served as a judicial law clerk for the Honorable Richard J. Donohue on the Superior Court of New Jersey, Bergen County.