Speakers: Michael T. Jackson
On 19 December 2025, New York Gov. Kathy Hochul signed the Trapped at Work Act (A584C) into law. The act, which went into effect immediately after signing, amended New York’s labor laws to restrict the parameters around when an employer can require an individual to agree—via the use of promissory notes, repayment agreements, or other comparable means—to reimburse the organization if they end their employment. However, in January 2026, the New York Legislature passed A9452, which amends the enacted law to implement various changes, including delaying the effective date of the overall act until 19 December 2026. A9452 was signed into law by Hochul on 13 February 2026.
New York’s enactment of the Trapped at Work Act coincides with the passage and implementation of a new law in California that also restricts the ability of employers to require workers in the state to repay various monetary or employment-related costs at the end of their employment. Employee training-related repayment agreements (TRAs) have been an area of increased scrutiny at the federal and state level for several years, and states such as Colorado have implemented laws restricting TRAs in recent years. However, the bills passed by California and New York reflect a broader scope of focus and extend, either directly or indirectly, into what employers can or cannot do related to mobility and relocation-related expenses. Similar legislation has been introduced but not progressed in Ohio, and additional bills are likely to be introduced in other states.
Updated Law Narrows Mobility-Related Scope, But Potential Impacts Remain
New York’s amended law addresses a number of significant issues contained within the original text. As originally passed via A584C, the act’s use of the term worker resulted in a broader application for non-employees within the organization, but this is updated within the amended law to specifically use the term employee.
Within the context of mobility and relocation, the updated law, as set forth in A9452, provides new language that narrows, but does not remove completely, the circumstances when an employer cannot utilize a relocation-related repayment agreement with an employee. Specifically, the amended law exempts repayment of a “financial bonus, relocation assistance, or other non-educational incentive or payment or benefit that is not tied to specific job performance,” except in cases where:
- The employee was “terminated for any reason other than misconduct” or
- The “duties or requirements of the job were misrepresented to the employee”
Based on the phrasing within the updated New York text, the revised law appears to permit repayment arrangements to be applied in circumstances where an employee departs their position voluntarily but continues to exclude their applicability in cases of involuntary terminations for any reason other than misconduct.
However, the statute does not explicitly state that it allows repayments with voluntary departures, and employers should work with their applicable internal and external counsel to review the new provisions, their applicability within their mobility programs, and any changes needed to ensure compliance once it goes into effect.