The things that New Jersey did in December 2025 are quietly important. Washington was going the opposite way, easing up on federal enforcement of disparate impact and going against decades of civil rights precedent. At the same time, a state agency finished making rules that could be more important for American employers than anything coming out of D.C. right now. Attorney General Matthew Platkin said that the New Jersey Division on Civil Rights passed the most thorough state-level disparate impact rules in the country. That’s a big claim. But when you read the language itself, it’s hard to disagree.
The main idea isn’t new. Even if a policy seems fair on paper, it may still be against the law if it hurts a protected group more than others. Under New Jersey’s Law Against Discrimination, the list of things that are protected is long and well-known. These include race, religion, gender, disability, and national origin. It’s just that these obligations are now being stated in a clearer and stronger way. Employers who thought “we didn’t mean to hurt anyone” was a good enough answer will find that it doesn’t get them nearly as far as it used to.
The really interesting part of the new rules (and the real risk for many employers) is what they say about tools that do the hiring for you. The word “artificial intelligence” is never used in the text, but the message is clear. Software that checks resumes, scheduling filters, and video interview platforms that look at facial expressions all fit neatly into the framework for disparate impact. The company that uses the tool is responsible if it leaves out applicants in a way that hurts a protected class more than others. No, not the seller. Who hired them.
You should read that last part again. New Jersey makes it clear that “reasonable steps” to make sure a vendor’s tool follows the law are not enough to protect a company if the tool still leads to discriminatory results. Many HR departments don’t like that line of thinking because it means that the standard contract clause that says employees will follow LAD rules might not be enough. Even if you have all the right paperwork, you could still be held responsible if the algorithm is slowly weeding out candidates from certain zip codes or punishing resumes with gaps that match protected characteristics.
A practical aspect of this doesn’t get talked about enough. A lot of midsize businesses, like those with 300 employees that work out of an office park in Parsippany or Teaneck, didn’t make their own tools for hiring. They bought them. They paid for the software, saw a demo, and believed it would do what it said it would do. To be honest, the idea that they now have to check these systems, ask for proof of validity, and run tools against their own employee data seems like a big operational ask. That’s the way things stand, though.
The rules set up a framework for shifting responsibility that is strict, just like serious civil rights law should be. A complainant names a policy and shows that it has a negative impact on a protected group that is statistically significant. The employer then has to show that the behavior is related to the job, necessary for the business, and couldn’t be changed to something less harmful. The last test, which asks if there is a less biased option, is pretty strong. New Jersey specifically got rid of language that said alternatives had to be “equally effective” in every way. We want to send the message that a slightly more difficult option is still available if it greatly lessens the effects of discrimination.
It’s still not clear how quickly the DCR will act in the coming months. When rules like these are made, there is usually a rush of activity to make sure they are followed, followed by a period of waiting to see what actually gets enforced. But it looks like the direction of travel is clear. This is not a neutral technology question that New Jersey is answering. This is a civil rights question, which is not the same thing.
Employers in the state don’t have to deal with a complicated answer, but it does take some time. Check your tools for screening. It’s important to know how your vendors’ models work, what data they were trained on, and what kind of bias testing they’ve done. Write down your business reasons. Set up regular reviews. But there’s a difference between knowing you should do something and knowing that a state regulator who has the power to subpoena people is now paying close attention.
The bigger picture is important here. A few years ago, it would not have seemed likely that the federal government would be cutting back on civil rights enforcement. It is clear that New Jersey is trying to fill some of that gap. Politics, money, and the desire to sue will determine if other states follow suit. But for now, the rules have changed if your company hires people in New Jersey. This includes companies that have employees in more than one state but only one remote worker in New Jersey. The algorithm that seemed like a fair tool is now a legal risk. Take care of it properly.
