AI Rules for Illinois Employers Lack Detailed Guidance

Mar 1

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It's here: Illinois' first AI law for business owners.

Summary

HB 3773 (effective Jan. 1, 2026) amends the Illinois Human Rights Act (IHRA) to address risks associated with use of AI in employment decisions.

The amendment impacts any employer who uses or intends to use AI to make decisions related to recruitment, hiring, promotions, renewal of employment, training, discipline, discharge, or any other term, privilege, or condition of employment.

Requirements

Employers will be prohibited from using AI in a manner that causes a discriminatory effect for any protected characteristic already covered under the IHRA or zip code as a proxy for any such class.

Practitioners should consider that that statute is silent respecting an employer's intent.

Employers are also required to give notice if they are using AI.

Analysis

Illinois’ amendment differs significantly from other laws addressing AI and employment discrimination around the country. Colorado passed its AI law in May 2024 (the CO law, too, addresses algorithmic discrimination), and New York City’s Local Law 144 requires NYC employers to undertake bias audits.

However, HB 3773 fails to detail the steps IL employers must take to address discriminatory consequences of AI tool use (e.g. bias audits, AI impact assessments, and implementing risk management systems).

While the law also fails to specify the exact form of notice required, the Illinois Department of Human Rights is charged with applying rules "on the circumstances and conditions that require notice, the time period for providing notice and the means for providing notice."

Enforcement and Remedies

Employees may file a charge with the IL Department of Human Rights if they believe they have been discriminated against due to AI use.

Remedies may include: