AI hiring laws in 2026: NYC, Illinois and Colorado explained

As of September 2026, the US AI hiring laws that recruiters most often run into are New York City's Local Law 144, two Illinois laws (the Artificial Intelligence Video Interview Act, in force since 1 January 2020, and HB 3773, in force since 1 January 2026), and Colorado's SB 26-189, which was signed on 14 May 2026 and takes effect on 1 January 2027. Most of them turn on two ideas: tell candidates when AI is involved, and don't let a tool discriminate. NYC adds a yearly independent bias audit.

This is general information for recruiters and staffing agencies, not legal advice. Laws change and the details depend on where the job is, where the candidate lives and how you use a tool. We link to the source for every legal statement below and give the date of each one. Talk to your own counsel before you rely on any of it.

Which laws should recruiters know about?

Federal, state and city anti-discrimination laws apply on top of all of these, whatever tool you use. The NYC DCWP FAQ makes the same point about its own law.

What does NYC Local Law 144 require?

The NYC Department of Consumer and Worker Protection (DCWP) says the law prohibits employers and employment agencies from using an automated employment decision tool (AEDT) unless the tool has had a bias audit within one year of its use, information about the audit is publicly available, and certain notices are given to employees or candidates. DCWP began enforcement on 5 July 2023.

DCWP's FAQ, dated 29 June 2023, fills in the details:

• What counts as an AEDT. A computer-based tool that uses machine learning, statistical modeling, data analytics or AI, helps make employment decisions, and "substantially assists or replaces discretionary decision-making."
• Screening counts. The FAQ says "employment decision" includes screening as well as the final hire. Using a tool to scan a resume bank or do outreach before someone applies is outside the requirements.
• Who is covered. The job is in an NYC office (at least part time), or it is remote but tied to an NYC office, or the employment agency using the tool is in NYC.
• The bias audit. It has to be done by an independent auditor, at least yearly, and must calculate selection or scoring rates and impact ratios across sex, race/ethnicity and intersectional categories. An auditor who works for you or the vendor, or who helped build or sell the tool, is not independent.
• Who is responsible. The employer or employment agency. The FAQ says the vendor that created the tool is not responsible for the bias audit, though a vendor can have one done.
• What you publish. A summary of the most recent audit results and the date you started using the tool, on the employment section of your website or through a link.
• Notice. NYC-resident candidates must be told you use an AEDT and what qualifications or characteristics it will assess, with instructions to request a reasonable accommodation. The notice goes out 10 business days before use, in a job posting, by mail or email, or on the employment section of your website.

Complaints go to 311 or DCWP. Discrimination claims go to the NYC Commission on Human Rights.

What do Illinois' two AI laws require?

The Artificial Intelligence Video Interview Act

This law applies when an employer asks applicants to submit recorded video interviews and uses AI analysis of those videos to evaluate applicants for a position based in Illinois. Our summary follows the overview published by Lysinski, an Illinois law firm; read the statute itself (820 ILCS 42) with your counsel. It took effect on 1 January 2020 and requires an employer, before the interview, to:

• Notify each applicant that AI may be used to analyze their video interview.
• Explain how the AI works and the general types of characteristics it uses to evaluate applicants.
• Get the applicant's consent. An employer may not use AI to evaluate applicants who have not consented.

After the interview, videos can be shared only with people whose expertise or technology is needed to evaluate the applicant. On the applicant's request, the employer must delete the videos within 30 days and instruct anyone who received copies, including backups, to delete them too. Employers that rely solely on AI analysis to decide who gets an in-person interview must report race and ethnicity data to the Illinois Department of Commerce and Economic Opportunity by 31 December each year.

Don't assume a voice screen is outside this law. Many interview tools turn the camera on, take screenshots, add a second camera angle or match a live face against an ID, even when the main interview is spoken. List every point where your process captures video or images of the candidate and where software analyzes them, then ask counsel whether the Act applies. If it does, plan for all of the above.

HB 3773

HB 3773 amended the Illinois Human Rights Act, effective 1 January 2026, according to K&L Gates, writing in the National Law Review on 1 May 2025. It covers AI use in recruitment, hiring, promotion, renewal of employment, selection for training or apprenticeship, discharge, discipline, tenure and conditions of employment. Employers can't use AI that has the effect of subjecting employees to discrimination on the basis of protected classes, and must notify employees and applicants when they use AI for those decisions.

Duane Morris (15 August 2024) adds that the law bars using ZIP codes as a proxy for a protected class.

What changed in Colorado with SB 26-189?

Colorado's 2024 AI law was SB 24-205. The Colorado General Assembly's bill page shows SB 26-189, "Automated Decision-Making Technology," was signed by the governor on 14 May 2026 and "repeals and reenacts" the 2024 provisions. Holland & Knight's summary (18 May 2026) gives the effective date as 1 January 2027.

The law covers "consequential decisions," and employment is one of them alongside education, housing, financial services, insurance, healthcare and government benefits. Based on those two sources, deployers (the businesses using the tool, which in hiring will usually be the employer or agency) will need to:

• Give clear and conspicuous notice at the point of interaction when a covered tool is used in a consequential decision.
• After an adverse outcome, give a plain-language explanation. The bill page says this is due within 30 days after the adverse decision.
• Let the person request their personal data and correction of factually incorrect data.
• Offer meaningful human review and reconsideration "to the extent commercially reasonable." Holland & Knight notes the reviewer must have authority to modify or override the decision.
• Keep records for three years.

Developers (the vendors) must give deployers documentation on intended uses, known limitations and risks, and tell them about material updates.

According to Holland & Knight, SB 26-189 drops the 2024 law's mandatory risk management programs and annual impact assessments, and eliminates the duty to use "reasonable care" to prevent algorithmic discrimination. The Colorado Attorney General has exclusive enforcement authority and there is no private right of action. Violations count as deceptive trade practices under the Colorado Consumer Protection Act, and before enforcing, the Attorney General must give notice and allow 60 days to cure, unless the violation was knowing or repeated. The bill page says this cure period applies to actions started before 1 January 2030.

What should recruiters and agencies do now?

Use this as a working list with your counsel:

• Inventory every tool in your hiring process that uses AI, statistical modeling or automated scoring, including resume screeners, chatbots, interview tools and assessments.
• For each tool, record what it does: does it recommend, rank, score or reject, and does a person review every outcome?
• Map where your jobs are and where your candidates live. NYC, Illinois and Colorado rules attach to different facts.
• For NYC roles, decide whether any tool substantially assists or replaces discretionary decisions. If it does, arrange an independent bias audit, publish the summary, and send notice 10 business days before use.
• For Illinois roles, add an AI notice to your application flow now. If any step captures video or images of the candidate that software analyzes, ask counsel whether the Video Interview Act applies, and if it does, add the explanation, consent, sharing limits and a 30-day deletion process.
• For Colorado roles, plan for notice, adverse-decision explanations, data correction and human review before 1 January 2027.
• Ask each vendor for documentation of what the tool evaluates, its known limitations, and whether it has had an independent bias audit.
• Keep a person responsible for every hiring and submission decision, and write down who that is.
• Keep records of notices, consents and decisions. Three years matches Colorado's rule.
• Review this list whenever you add a tool or open roles in a new state.

Where does Simplehire fit?

We don't claim Simplehire makes you compliant with any of these laws. Whether a tool triggers a requirement depends on how you use it, where the job is and who the candidates are, and the obligations above mostly fall on the employer or agency. Simplehire's Screen verdict is an AI-generated recommendation, so the safe starting assumption is that it could count as an AI or automated decision tool under these laws. Check with your counsel.

Here are the facts about how Simplehire works, so you can map them against your own obligations:

• A person always makes the hiring decision. Simplehire gives a Screen verdict (Advance, Maybe or Reject) with evidence: Skills demonstrated X/Y, a Screen summary, Strengths, Areas to probe and Key insights. It does not hire or reject anyone on its own.
• There is no numeric score. The verdict is a recommendation the recruiter reviews.
• Candidates are informed before monitoring begins, including second-device monitoring.
• Integrity alerts are reviewed by a person before they reach a decision.
• Interview audio is recorded, and integrity alerts come with screenshots.
• The candidate's webcam shows their face on the main interview screen. If you require a second device, the candidate's phone adds a side-camera view of them and their desk.
• If you turn on the ID check, the candidate passes a government ID check and a live face match before the interview begins.
• Simplehire does not run AI analysis of the candidate's video or audio to judge cheating or AI use.
• Simplehire Proctor's desktop checks do not capture screen content, keystrokes, files, URLs or audio.

Because the camera is on and the ID check matches a live face, don't treat Simplehire as outside the Illinois Video Interview Act without asking counsel, especially for Illinois-based roles.

The proctoring page lists what each check does. If you have questions about how Simplehire fits into your notice process, talk to sales.

For the other side of AI in hiring, the fraud that is driving teams to screen more carefully, see candidate fraud statistics and how to spot a proxy interview. Our guide to AI phone screening for staffing agencies covers where a screen fits in the agency workflow.