By: Johnson S.B. No. 2991

A BILL TO BE ENTITLED

AN ACT

relating to the use of an automated employment decision tool by an employer to assess a job applicant's fitness for a position; imposing an administrative penalty.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Title 2, Labor Code, is amended by adding Subtitle F to read as follows:

SUBTITLE F. PROVISIONS REGARDING JOB APPLICANT SCREENING

CHAPTER 95. USE OF AUTOMATED EMPLOYMENT DECISION TOOL

Sec. 95.001. DEFINITIONS. In this chapter:

(1) "Algorithm" means a computerized procedure consisting of a set of steps used to accomplish a determined task.

(2) "Applicant" means a person applying for a job offered by an employer.

(3) "Artificial intelligence system" means a system of machine learning and related technologies that use data to train statistical models for the purpose of enabling computer systems to perform tasks normally associated with human intelligence or perception, such as computer vision, speech or natural language processing, and content generation.

(4) "Automated employment decision tool" means a computational process or software application that uses algorithms, machine learning, statistical modeling, data analytics, or an artificial intelligence system to assess an applicant's fitness for a position.

(5) "Employer" has the meaning assigned by Section 61.001.

Sec. 95.002. USE OF AUTOMATED EMPLOYMENT DECISION TOOL. (a) An employer may not use or deploy, or authorize a third party to use or deploy, an automated employment decision tool in violation of this chapter or a rule adopted under this chapter.

(b) It is a violation of this chapter for an employer to use an automated employment decision tool that includes, as a factor in the assessment of fitness for purposes of recruitment, hiring, promotion, renewal of employment, selection for training or apprenticeship, discharge, discipline, tenure, or the terms, privileges, or conditions of employment, status in a protected class under state or federal law, or the residential zip code of the applicant.

Sec. 95.003. DISCLOSURE AND CONSENT REQUIRED. An employer may not use an automated employment decision tool in regard to an applicant unless the employer:

(1) notifies the applicant that an automated employment decision tool may be used to assess the applicant's fitness for the position;

(2) provides the applicant with information describing how the automated employment decision tool will be used to assess the applicant's fitness for the position, including what characteristics may be evaluated for that purpose; and

(3) before using the automated employment decision tool, obtains the applicant's written consent for that use.

Sec. 95.004. SHARING OF AUTOMATED EMPLOYMENT DECISION TOOL ASSESSMENT. An employer may not share an assessment of an applicant made by an automated employment decision tool authorized under this chapter with any person other than a person whose knowledge and skill is necessary in order to ensure the tool is correctly processing the applicant's data.

Sec. 95.005. DESTRUCTION OF AUTOMATED EMPLOYMENT DECISION TOOL ASSESSMENT. (a) Not later than the 30th day after the date an employer uses an automated employment decision tool to assess an applicant's fitness for a position as authorized under this chapter, an employer must:

(1) make all reasonable efforts to destroy any hard copy and erase any electronic data file of the assessment; and

(2) instruct any other person with whom the employer shared the assessment under Section 95.004 to make all reasonable efforts to destroy any hard copy and erase any electronic data file of the assessment.

(b) A person who is instructed by an employer to destroy an assessment under Subsection (a)(2) shall, as soon as practicable, make all reasonable efforts to destroy any hard copy and erase any electronic data file of the assessment.

Sec. 95.006. ENFORCEMENT; ADMINISTRATIVE PENALTY. (a) An applicant who has reason to believe that an employer has violated this chapter or a rule adopted under this chapter may file a complaint with the commission.

(b) On receipt of a complaint under this section, the commission shall investigate and dispose of the complaint in the manner prescribed by Subchapter F, Chapter 21, for a complaint of an unlawful employment practice under that chapter.

(c) The commission shall assess an administrative penalty in an amount that is not less than $2,500 and not more than $7,500 against an employer for each violation of this chapter or a rule adopted under this chapter.

Sec. 95.007. RULES. The commission shall adopt rules for the administration of this chapter.

SECTION 2. This Act takes effect September 1, 2025.