The California Legislature recently introduced a bill (Senate Bill (SB) 951) that would establish the California Worker Technological Displacement Act—a first-of-its-kind law that would require employers to provide advance written notice when artificial intelligence (AI) or automation drives workforce reductions or hiring freezes.

Quick Hits

• California Senate Bill 951 would require employers to provide at least ninety days’ advance written notice before eliminating positions due to AI or automation affecting twenty-five or more workers or twenty-five percent of the workforce, and to separately notify state agencies when they permanently stop hiring for roles replaced by AI.
• The bill would protect affected workers at companies with more than one hundred employees by prohibiting discharge without reasonable cause during the notice period and granting a right of first bid on other open positions within the company.
• Noncompliant employers would face liability for back pay and benefits to each affected worker, civil penalties of up to $500 per day, and potential lawsuits brought by workers, local governments, or worker representatives, with courts empowered to award attorneys’ fees and costs.

What the Bill Would Do

1. Technological Displacement Notice

An employer would be required to provide at least ninety days of advance written notice before any “technological displacement”—defined as the elimination of employment positions caused in whole or primarily by an AI system or...

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