Seyfarth Midyear Report: AI Hiring Rules, Pay Transparency, and State Law Patchwork Define H2 2026 Compliance
Not legal advice. This article discusses legal and regulatory developments and is generated with AI assistance under human editorial review. It is provided for informational purposes only and does not constitute legal advice. Laws and regulations vary by jurisdiction and are subject to change. You should consult your own qualified legal counsel before taking or refraining from any action based on the content of this article. Read our AI Transparency statement.
The News
Seyfarth Shaw's Midyear Employment Law Horizon Report, released in late July 2026, provides a comprehensive map of US employment law changes taking effect in the second half of 2026 and beyond. The report highlights several developments directly affecting TA teams: Connecticut's CART Act (Public Act 26-15) takes effect 1 October 2026, imposing disclosure obligations on employers using AI in hiring and requiring WARN notices to disclose whether AI informed layoff decisions. Colorado's revised AI law (SB 26-189), signed 14 May 2026, replaces the original SB 24-205 with a narrower automated decision-making technology framework effective 1 January 2027 — dropping the duty to prevent algorithmic discrimination but adding consumer rights to human review. The report also tracks expanding state pay transparency laws, new worker classification rules, and the EEOC's shift away from disparate impact enforcement under its new National Enforcement Plan.
Why It Matters
The headline for TA leaders is regulatory divergence. The federal EEOC is pulling back from disparate impact enforcement and rescinding AI guidance, but state and local laws are accelerating in the opposite direction. Connecticut's CART Act requires pre-decision written notice to candidates when AI materially influences a hiring decision — including the tool's trade name, purpose, and categories of personal data analysed. Colorado's revised law drops the most burdensome requirements (risk management programmes, impact assessments) but adds a right to human review of AI-influenced decisions. Meanwhile, pay transparency laws now exist in over a dozen states with varying thresholds, posting requirements, and enforcement mechanisms. If your hiring footprint spans multiple US states, you're now managing a patchwork where the same AI tool may require different disclosures, audits, or candidate rights depending on jurisdiction.
Taking Action
All action is situated in your corporate context. These are starting points, not prescriptions — choose what fits.
Connect
Who to talk with in your enterprise
Your employment counsel: Ask for a jurisdiction-by-jurisdiction matrix of AI hiring obligations covering every state where you recruit. The report makes clear that Connecticut (October 1), Colorado (January 2027), Illinois (in effect, rules pending), and NYC (in effect) each have distinct requirements. A single national policy won't suffice.
Your compensation and rewards lead: Request a review of job posting practices against the expanding patchwork of state pay transparency laws. The report flags new requirements taking effect in H2 2026 that may require salary ranges in postings where they weren't previously mandated.
Inspect
What to take a closer look at
Check whether your Connecticut hiring processes are ready for 1 October. The CART Act requires deployers of AI in employment decisions to provide written pre-decision notice stating: that an AEDT has been deployed, its purpose, the nature of the decision, the trade name of the tool, and the categories and sources of personal data it analyses. If you can't produce this notice today, you have nine weeks to build it.
Reflect
What to think about more deeply
If the federal government is stepping back from AI hiring enforcement while states step in, does your compliance strategy follow the federal retreat or the state advance — and which one will your CEO blame you for getting wrong?