Following the recent wave of year-end employment law changes in New York, one law has rapidly emerged as a focal point for employers: the “Trapped at Work Act” (the Act). In our recent legal alert, “New York Issues Four Year-End Employment Law Changes,” we introduced this new law and highlighted its key provisions.

Since the publication of that alert, the New York State Assembly has introduced amendments to the Act that, if approved by the Gov. Kathy Hochul, would significantly revise the provisions enacted in late December.

Relevant Background

In December, Governor Hochul signed the Act into law, amending the New York Labor Law to prohibit stay-or-pay agreements, referred to in the statute as “employment promissory notes.”

Under the Act, an “employment promissory note” is defined as “any instrument, agreement, or contract provision that requires a worker to pay the employer, or the employer’s agent or assignee, a sum of money if the worker leaves such employment before the passage of a stated period of time.” The Act also prohibits any agreement that characterizes repayment as reimbursement for employer-provided training.

The Act’s broad definition of “employment promissory note,” coupled with its lack of a definition for “training,” immediately raised concerns and questions among New York employers. Many employers maintain tuition-reimbursement programs and other benefit agreements that require employees to remain with the organization for a specified period. These...

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