New York employers should soon have more clarity on the Empire State’s new law targeting “stay or pay” agreements – and more time to comply. The state legislature recently passed amendments designed to address ambiguities and potential overreach in the original statute enacted in December 2025. The Trapped at Work Act, signed by Governor Hochul late last year, was intended to protect worker mobility by prohibiting employment agreements that require employees to repay certain training costs if they leave the job before a specified period. These are known as “stay or pay” agreements. However, the law’s broad language raised concerns about its impact on common employment practices, such as repayment of tuition reimbursement, signing bonuses, and relocation packages. The new updates will better define the law’s application and carve out exceptions for these and other standard business arrangements. Here’s what you need to know about the act and the pending changes as we wait for the Governor’s approval.
What Does the Law Do?
NY’s Trapped at Work Act prohibits employers from requiring workers to sign agreements that mandate repayment if the worker leaves employment within a specified time period. Notably, this includes agreements requiring reimbursement for training costs. These restrictions apply to both employees and independent contractors, as well as interns, volunteers, and any other individual working on behalf of an employer.
Some types of agreements are excluded from...
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