Employment Tip Of The Month – February 2026

Q: Could the pending amendments to NYS's new Trapped at Work Act expand potential exposures for employers?

A: It is important to be aware of what the amendments to the new Trapped at Work Act clarify in order to limit potential exposures.

Proposed Amendments
The Trapped at Work Act (Act) was signed into legislation, effective immediately, on December 19, 2025, by Governor Kathy Hochul. The Act prohibits employers from conditioning employment on an employee's or job candidate's signature on an employment promissory note. An "employment promissory note" is any instrument, agreement, or contract provision that requires a worker to pay the employer a sum of money if the worker leaves such employment before a designated period of time. The Act, as initially written, raised concerns relating to compensation arrangements, including sign-on bonuses and reallocation allowances, as well as other uncertainties.

At the time of signing, Governor Hochul stated that she would work with legislators to correct the ambiguities within the Act. On January 6, 2026, Bill A09452 (the Amendment) was introduced to propose clarifications and changes as outlined below:

1. Delay of the Effective Date
   a. A09452 would delay the effective date of the Act to one year after it becomes law. However, the Amendment as drafted, does not specify whether the effective date is measured from the original date of enactment or the date of the Amendment's enactment. As a result, employers should proceed with caution with a one-year compliance period to get on track.
   
2. Simplification of the Definitions of Covered Employees and Employers
   a. As written, the Act applies to all "workers," including employees, independent contractors, interns, volunteers, and apprentices. The Amendment aims to clarify applicability to "employees" defined as "any person for hire by an employer in any employment." Additionally, the Amendment would redefine "employer" as "any person, corporation, limited liability company, or association employing any individual in any occupation, industry, trade, business, or service including the state and its political subdivision." The Amendment will also remove "partnerships" and "subsidiaries" as covered "employers."
   
3. Common Compensation Arrangements Exceptions
   a. The Amendment would revise the current language to clarify the exemption for repayment obligations relating to "a financial bonus, relocation assistance, or other non-educational incentive or other payment or benefit that is not tied to specific job performance, unless the employee was terminated for any reason other than misconduct or the duties or requirements of the job were misrepresented to the employee."
   
4. Tuition Repayment Exceptions
   a. The Amendment would supplement the Act to include an exception for voluntary tuition repayment agreements relating to "transferable" educational credits. "Transferable" credits include industry-recognized degrees, diplomas, licenses, certificates, and skills training that enhance employability.
   
   b. Such exception, however, is subject to strict conditions: enrollment cannot be a condition of employment; the repayment amount must be immediately disclosed and capped at the employer's actual cost; repayment must be prorated over time and cannot be accelerated following separation; and no repayment is owed if the employee is terminated involuntarily, except for misconduct.
   
5. Enforcement and Penalties
   a. Neither the Act nor the Amendment provides a private right of action by workers to enforce its provisions, leaving deference to the State Department of Labor (DOL). The Amendment will, however, explicitly permit affected employees to submit complaints to the DOL and provide guidelines for the DOL to consider when assessing penalties. Such factors include employer size, good faith, and the severity of the violation. The Amendment will not alter the Act's provision that employers could be liable for any attorneys' fees incurred by employees in their defense against a collection arising from a prohibited agreement.

Next Steps
Until the Amendment is enacted, New York employers should continue evaluating their bonus and repayment agreements pursuant to the language within the Act and be prepared to adapt to the proposed changes. Employers in other states should remain alert for similar acts enacted or proposed.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.