Does Resume Formatting Software Fall Under NYC Local Law 144?

The test every one of these laws applies

NYC Local Law 144 has been enforced since July 2023 and is the one people name first. It regulates an "automated employment decision tool" — and the rules define that as a computational process that issues a "simplified output, including a score, classification, or recommendation" which is used to substantially assist or replace discretionary decision making.

Two parts of that matter. The first is simplified output. A tool that takes a candidate's resume and gives you back the same resume in your template has produced no score, no classification and no recommendation. It has produced a document. There is nothing for a bias audit to audit, because nothing was ranked.

The second is substantially assist. The rules define that too: the output has to be the only criterion, the most heavily weighted criterion, or something that overrides a human conclusion. A formatted resume does not weigh anything. The recruiter reading it makes exactly the decision they would have made reading the original.

This is not a loophole and it is not our interpretation being generous to ourselves. It is the same distinction every one of these laws draws, because they were all written about screening and ranking. Formatting was never the target.

• Parses a resume into fields — not an AEDT.
• Rewrites the prose at a level you choose — not an AEDT.
• Applies your template and brand — not an AEDT.
• Scores, ranks, shortlists or recommends candidates — this is where the laws start.

You are a covered entity. Your formatter still is not a covered tool.

Here is the part vendors skip, and it cuts against the reassurance above. Local Law 144 binds employers and employment agencies. A staffing firm is an employment agency. You are inside the scope of the law.

That matters for your screening stack — the matching engine in your ATS, any tool that ranks a shortlist, anything that scores a candidate against a job order. If you use one of those on New York City candidates or roles, the bias audit, the public summary of results and the ten-business-day candidate notice are your obligations, not the vendor's.

So the honest framing is: being a covered entity and using a covered tool are two different facts. You are the first. A resume formatter is not the second. Do not let a vendor sell you an audit for a document converter, and do not let the absence of one convince you that your matching engine is fine.

The state-by-state position as of August 2026

The landscape moved twice this year, and a lot of published guidance is now wrong. Here is where things actually stand.

Colorado is the one to correct. SB 24-205 was widely written about as the first comprehensive state AI act, and it is dead — enforcement was enjoined in April 2026 and the statute repealed and replaced. Its successor, SB 26-189, was signed in May 2026 and takes effect on 1 January 2027. It covers automated decision-making technology that materially influences a consequential decision, which is the same substance test in different words. If you read an article telling you to prepare for SB 24-205, that article is out of date.

Illinois HB 3773 amended the Illinois Human Rights Act and has been in force since January 2026. It prohibits AI that produces a discriminatory effect in recruitment and requires notice when AI is used. It is effect-based, so intent is not required. Again, the target is decisions, not documents — but the notice requirement is worth checking against whatever your ATS is doing, not just against your formatter.

The Illinois AI Video Interview Act is frequently listed alongside it and is irrelevant here: it governs AI analysis of applicant-submitted video interviews and nothing else.

Texas passed TRAIGA in 2025, effective January 2026, and it is intent-based — disparate impact alone is not a violation. That makes it materially weaker than the Illinois standard, which is worth knowing if you place in both.

California is the one that actually reaches your vendor

California's Civil Rights Department regulations on automated decision systems took effect on 1 October 2025 and are the most consequential item on this list for a staffing firm buying software.

The definition is broader than New York's. An ADS is a computational process that makes a decision or facilitates human decision making regarding an employment benefit. "Facilitates" does more work than "substantially assists". A document converter still does not make or facilitate a decision — it changes how information is presented, not which information reaches a decision — but the margin is thinner and worth watching.

The provisions that bite are the ones nobody markets against. The regulations require four years of retention of ADS data. They hold employers responsible for tools operated by third parties on their behalf. And they contemplate aiding-and-abetting exposure for vendors, which means your supplier's conduct is not purely your supplier's problem.

The practical consequence is a records question, not an audit question: can you say what a tool did to a candidate's file, and can you still say it in four years?

What happened to the EEOC guidance

The EEOC published technical assistance in May 2023 on Title VII and AI in hiring. It was removed from the agency's website following an executive order in January 2025, and a lot of vendor content still cites it as though it were live.

Title VII itself has not changed. Disparate impact liability for selection procedures is statutory and predates every AI law on this page by six decades. The removal of a guidance document changed the commentary, not the exposure.

This is the general shape of the area: the federal guidance is quieter than it was, the state laws are louder, and the underlying anti-discrimination law is exactly where it always was.

What to actually ask a formatting vendor

Since the bias-audit question does not apply, here is what does. These are the questions we would want asked of us, and the ones that separate products that can answer from products that change the subject.

Note what is absent from that list: anything about bias audits. If a resume formatting vendor volunteers an AEDT bias audit, ask them which simplified output it audited. The answer is usually that they bought the audit to close deals, which tells you something about the rest of their claims.

• Can the AI add content that was not in the candidate's original resume, and what stops it? Ask for the mechanism, not the policy.
• Can I see, per field, where a value came from in the original document?
• What is retained, where, and for how long — and can I set it? California's four-year ADS retention rule is the floor to have in mind.
• Is candidate data sent to a third-party model provider, under what agreement, and is it used for training?
• What does the tool do when it is unsure? A product that always returns something confident is telling you it has no uncertainty state.
• What are the published limits? A vendor with no stated limits has not looked for them.

Frequently asked questions

Does a resume formatting tool need an NYC Local Law 144 bias audit?

On the definitions in the rules, no. An AEDT has to produce a simplified output — a score, classification or recommendation — that substantially assists or replaces discretionary decision making. A tool that reformats a resume produces a document, not a score, so there is nothing for a bias audit to measure. Your screening and matching tools are a different question, and there you are a covered entity.

We are a staffing agency. Does Local Law 144 apply to us at all?

Yes — the law binds employers and employment agencies, and a staffing firm is an employment agency. That makes you responsible for the AEDTs you use on New York City roles or candidates, including the bias audit, the published summary of results and candidate notice. It does not convert your formatting tool into an AEDT.

Should we be preparing for Colorado SB 24-205?

No. Enforcement was enjoined in April 2026 and the act was repealed and replaced by SB 26-189, signed in May 2026 and effective 1 January 2027. Guidance that still refers to SB 24-205 has not been updated. The successor uses a "materially influences a consequential decision" test.

Which of these laws most affects our choice of formatting vendor?

California's ADS regulations, in force since October 2025 — not because they classify a formatter as an ADS, but because of the four-year retention requirement, employer responsibility for third-party tools and the aiding-and-abetting exposure for vendors. Those turn vendor record-keeping into your problem in a way the New York bias-audit regime does not.

Is the EEOC's AI guidance still in force?

The May 2023 technical assistance was removed from the EEOC website following an executive order in January 2025. Title VII is unchanged, and disparate impact liability for selection procedures is statutory. A withdrawn guidance document changed the commentary rather than the underlying law.

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