Illinois HB 3773 took effect in January. The liability is yours, not your vendor's.
Illinois HB 3773's AI notice requirement took effect January 1, 2026 and falls on the employer deploying the tool. Your vendor's compliance claims do not cover you.
If your company uses an ATS, a resume-screening tool, or a performance platform that applies algorithmic decision-making to hiring or promotion, Illinois HB 3773 requires you to give applicants written notice before that tool touches their data. The obligation lands on you as the deployer. Your vendor's terms of service do not transfer the exposure. Epstein Becker Green's September 2026 analysis of workplace AI regulation confirms that several state AI employment laws took effect on January 1, 2026, and that the compliance burden falls on the employer using the system, not the company that built it.
Most companies at your size have not done this audit. Asure Software's 2026 HR Benchmark Report found that small-business owners have lost confidence they are complying with employment law at all, and AI-specific notice requirements are newer and narrower than the general compliance questions most HR teams are already behind on. A specific statutory trigger sitting inside a general audit deficit produces liability that grows without anyone noticing it.
Your vendor's claim that a tool is compliant does not satisfy your obligation. As the company deploying the tool, you are responsible for giving the required notice and for being able to prove you did it.
What triggers the obligation
The notice requirement attaches to any system that uses automated analysis to evaluate candidates or employees. That includes scoring resumes, ranking applicants, flagging performance outliers, or generating interview recommendations. If the platform does any of that before a human makes a final call, you are likely inside the statute's scope. Read your vendor contracts this week. Look for language about algorithmic scoring, machine learning, or predictive analytics. If you find it, assume the notice obligation applies until your employment counsel says otherwise.
What the audit looks like in practice
Pull a list of every hiring and performance tool your company pays for. For each one, answer two questions: does it apply any automated analysis to individual people, and have you given applicants or employees written notice that it does? If you cannot answer both questions in under ten minutes, the audit is not done. Document what you find. A spreadsheet with tool name, function, notice status, and the date you reviewed it is enough to show good-faith effort if a complaint surfaces.
What to fix now
Draft a notice template before your next hire. Waiting until a complaint arrives to write one is the scenario this statute was designed to punish. The notice does not need to be long. It needs to name the tool, describe what it does with the applicant's data, and land before the tool runs. If you use an employment-law tracking tool, check whether HB 3773 is already flagged in your compliance calendar. If your handbook or offer flow does not have a place for this notice, build one. The gap between "we use this tool" and "we told candidates we use this tool" is exactly where the exposure lives.
If you want to work through the audit against your specific tool stack, bring your vendor contract list to a 45-minute working session at peoplepartners.ai/contact.