January 26, 2026
New York Enacts Trapped at Work Act
On December 19, 2025, New York State Governor Kathy Hochul signed into law the Trapped at Work Act. The Act went into effect immediately, but proposed amendments to the Act are pending.
What Changed?
Under the Act, New York employers are prohibited from requiring workers, as a condition of employment, to agree to repay a sum of money if the worker leaves employment before a specified time. Among other things, the Act prohibits reimbursement for training provided by the employer or a third party. The Act imposes fines of $1,000 to $5,000 for each violation.
The Act includes limited exceptions. Employers may require payment for legitimate payroll advances (unless used for training), property sold or leased to the worker, agreements relating to sabbaticals for educational personnel, or when repayment is part of a collective bargaining agreement.
What’s Next?
Governor Hochul signed the Act on the condition that the NYS Legislature would propose amendments to clear up some ambiguities. The Legislature complied on January 6, 2026.
Among other changes, the amendments would permit some voluntary tuition-repayment agreements for transferable, industry-recognized credentials. The amendments would also allow limited repayment of certain employer-provided benefits, such as bonuses, relocation assistance, or employer-provided property. The amendments would limit the Act to employees, not all workers, and postpone the Act’s effective date until December 19, 2026. Finally, the amendments would allow the commissioner to give due consideration to the size of the business, the employer’s good faith, the gravity of the violation, and the employer’s history of previous violations when imposing fines.
Takeaways
As of now, the Act signed on December 19 remains in effect, and employers should review their agreements and policies to ensure compliance. We will continue to closely monitor the Trapped at Work Act and the status of the proposed amendments and will provide updates as developments occur. If you have any questions about your employment agreements or compensation arrangements, please reach out to Chaim Book at cbook@booklawllp.com, Sheryl Galler at sgaller@booklawllp.com, Rebecca Nathanson at rnathanson@booklawllp.com, or Charlotte Pramer at cpramer@booklawllp.com.
