New Jersey Takes The Lead On AI Accountability In The Workplace

Employers are increasingly turning to artificial intelligence to streamline hiring and workforce management. A 2024 Rutgers University survey found that 63% of the New Jersey employers who participated now use AI-enabled tools to recruit or make hiring decisions ^[1]. In light of its growing prevalence in the workplace, New Jersey has emerged as a frontrunner in regulating AI decision-making in employment. Through administrative guidance issued in January 2025 and new regulations finalized in December 2025, the New Jersey Attorney General and Division on Civil Rights have sent a clear message: AI tools are not a shield against liability under the state’s Law Against Discrimination (“LAD”).

The 2025 Guidance on Algorithmic Discrimination – Misusing AI

In January 2025, the New Jersey Office of the Attorney General and the Division on Civil Rights (“DCR”) issued guidance to clarify how the LAD applies to “algorithmic discrimination” –discrimination resulting from the use of automated decision-making tools (the “Guidance”) ^[2]. The Guidance confirmed that the LAD applies to algorithmic discrimination the same way it applies to other discriminatory conduct, prohibiting bias in employment on the basis of race, religion, national origin, sex, gender identity, disability, and other protected characteristics. 

The Guidance defined automated decision-making tools broadly to mean 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.” ^[3] Such automated decision-making tools are increasingly used to determine whether a human reviewer reads a resume, whether an applicant is hired, and whether an employee is promoted, demoted, or fired, among other things. The DCR explained that such tools often accomplish their aims by using algorithms that analyze data, uncover correlations, and make predictions based on those correlations ^[4]. By doing so, however, these tools can create classes of individuals who will be either advantaged or disadvantaged in ways that may exclude or burden them based on their protected characteristics. 

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