Illinois Department of Human Rights Temporarily Withdraws Proposed Rules on Use of Artificial Intelligence in Employment

Seyfarth Synopsis: The Illinois Department of Human Rights recently announced that it is temporarily withdrawing the proposed rules it released, which implemented the AI notice requirements applicable to employers who use artificial intelligence for employment processes. The public hearing originally scheduled for June 10, 2026, has been canceled. Although the proposed rules have been withdrawn, the underlying statutory obligations under HB 3773 remain in effect, while the contours of compliant notice in Illinois remain unclear. Despite the withdrawn status, the proposed rules provide helpful context regarding what may be required from Illinois employers.

Background

On August 9, 2024, Governor J.B. Pritzker signed HB 3773 into law, making Illinois one of a growing number of jurisdictions regulating the use of AI in employment decisions. The law took effect on January 1, 2026.

As previously covered, HB 3773 requires employers to provide notice to applicants and employees when AI is used in covered employment decisions, prohibits the use of zip codes as a proxy for protected classes in AI-driven processes, and reinforces that employers may not use AI in a manner that results in discrimination on the basis of any protected class under Illinois law. The law also grants the Illinois Department of Human Rights (“IDHR”) broad rulemaking authority to define the circumstances requiring notice, the timing for notice, and the means of delivery.

On May 15, 2026, IDHR announced and published proposed amendments to Title 44, Part 2520 of the Illinois Administrative Code to implement those statutory obligations. A 45-day public comment period was opened, with written comments due by June 29, 2026, and a public hearing was scheduled for June 10, 2026.

Proposed Rulemaking Postponed

On June 2, 2026, IDHR announced that it was temporarily postponing the rulemaking process, including the June 10 public hearing. IDHR stated that the postponement was necessary to allow for continued collaboration with other state agencies. IDHR did not provide a revised timeline but indicated that updated information on next steps will be released. In the meantime, the Department encouraged stakeholders to monitor its Legislative Updates webpage for future announcements and rescheduling details.

What the Withdrawn Rules Reveal About IDHR’s Approach

Although the rulemaking has been postponed, the withdrawn rules still offer insight into IDHR’s general approach and the level of specificity employers may expect, recognizing that additional revisions or changes are possible.

Covered Employers and Agents

The withdrawn rules apply to employers as defined under the Illinois Human Rights Act (“IHRA”), along with any third-party acting on an employer’s behalf to “exercise control” over covered employment actions. These entities would qualify as agents and are included in the definition of “employer” under the withdrawn rules. Accordingly, depending on the nature of “control” exercised, staffing firms, technology vendors, external recruiters, and other service providers may share in the same compliance obligations as the employing entity.

Covered AI Tools and Use Cases

The definition of artificial intelligence under Illinois law is exceptionally broad, covering any “machine-based system that, for explicit or implicit objectives, infers, from the input it receives, how to generate outputs such as predictions, content, recommendations, or decisions that can influence physical or virtual environments.” The definition expressly includes generative AI.

The scope of covered employment decisions extends across the full lifecycle of the employment relationship, from recruitment and hiring through discipline, discharge, and the terms and conditions of employment. In addition, the definition of “use” in the withdrawn rule is particularly expansive because it captures any instance in which an AI system “influences or facilitates” a covered employment decision.

While the withdrawn rules identify a non-exhaustive list of covered AI use cases, including computer-based assessments, targeted job advertisements, resume screening, analysis of facial expressions or voice in interviews, analysis of third-party data, productivity monitoring, and work assignment algorithms, the breadth of the underlying definitions extends well beyond these illustrative examples.

Taken together, the definitions significantly broaden the potential scope of the law by capturing AI use cases that play even a peripheral role in an employment decision, including those where the AI output is incidental or supplementary to human decision-making. Unless the rules are revised, Illinois could cover far more use cases than those that are currently covered by other state AI laws.

Notice Obligation for Covered AI Use Cases

Employers using covered AI tools would be expected to provide advance notice to employees, prospective employees, and exclusive bargaining representatives. The obligation applies regardless of whether the AI use raises discrimination concerns or is determinative of the employment decision.

Absent further revisions, employers may need to be prepared to disclose six specific elements: (1) the AI system's developer, product name, and vendor, (2) the covered employment decision it influences, (3) the system's purpose and categories of data collected, (4) the types of job positions the tool will be used for, (5) a point of contact for questions, and (6) the right to request a reasonable accommodation. The withdrawn rules further contemplate that notice be provided simultaneously through multiple channels, including through employee handbooks, physical postings, intranet and external websites, and job postings.

Implications for Employers

The temporary postponement of IDHR’s proposed rulemaking provides employers with additional time but should not be treated as an invitation to pause compliance planning. The underlying statutory obligations of HB 3773 have been in effect since January 1, 2026, and the withdrawn proposed rules offer meaningful insight into the regulatory direction employers should be preparing for, even if further revisions are possible. Employers should use this window to assess their AI footprint and begin expanding their notice and recordkeeping processes, so that when the rulemaking resumes, they are not starting from scratch.

We will continue to monitor IDHR’s rulemaking process and provide relevant updates as developments occur. For additional information, please contact the authors of this alert, a member of Seyfarth's People Analytics team, or any of Seyfarth's attorneys.