Senate Bill S8822

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   8822
 
                             I N  S E N A T E
 
                              January 8, 2026
                                ___________
 
 Introduced  by  Sen.  MAY  --  read  twice and ordered printed, and when
   printed to be committed to the Committee on Rules
 
 AN ACT to amend the labor law, in relation to  prohibiting  the  use  of
   employment promissory notes and other similar provisions; and to amend
   a  chapter  of  the  laws  of  2025 amending the labor law relating to
   enacting the "trapped at work act", as proposed in  legislative  bills
   numbers  S.  4070-B  and  A.   584-C, in relation to the effectiveness
   thereof
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Section 1050 of the labor law, as added by a chapter of the
 laws of 2025 amending the labor law relating to enacting the "trapped at
 work  act",  as  proposed  in legislative bills numbers S. 4070-B and A.
 584-C, is amended to read as follows:
   § 1050. Definitions. For purposes of this article:
   1. "Employer" means [an individual, partnership,  association,  corpo-
 ration,  limited  liability  company,  trust,  government  or government
 subdivision, or any organized group that hires or contracts with a work-
 er to work for the employer. For the purposes of this article, this term
 shall also include any subsidiary of an  employer  and  any  individual,
 partnership, association, corporation, limited liability company, trust,
 government  or government subdivision, or any organized group associated
 with an employer that provides training to workers] ANY  PERSON,  CORPO-
 RATION, LIMITED LIABILITY COMPANY, OR ASSOCIATION EMPLOYING ANY INDIVID-
 UAL  IN  ANY  OCCUPATION, INDUSTRY, TRADE, BUSINESS OR SERVICE INCLUDING
 THE STATE AND ITS POLITICAL SUBDIVISIONS.
   2. ["Worker" means an individual who is permitted to work  for  or  on
 behalf of an employer. The term "worker" includes an employee, independ-
 ent  contractor,  extern, intern, volunteer, apprentice, sole proprietor
 who provides a service or services to an employer  or  to  a  client  or
 customer  of  an  employer on behalf of such employer, and an individual
 who provides service through a business or nonprofit entity  or  associ-
 ation.  "Worker"  does not include an individual, even if the individual
 performs incidental service for the employer,  whose  sole  relationship

  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD01084-10-6
 S. 8822                             2

 with  the  employer is as a vendor of goods] "EMPLOYEE" MEANS ANY PERSON
 EMPLOYED FOR HIRE BY AN EMPLOYER IN ANY EMPLOYMENT.
   3.  "Employment  promissory  note" means any instrument, agreement, or
 contract provision that requires [a  worker]  AN  EMPLOYEE  to  pay  the
 employer,  or  the  employer's  agent or assignee, a sum of money if the
 [worker leaves such employment] EMPLOYEE'S EMPLOYMENT RELATIONSHIP  WITH
 A  SPECIFIC EMPLOYER TERMINATES before the passage of a stated period of
 time. ["Employment promissory note" includes any such instrument, agree-
 ment, or contract provision which states such payment of moneys  consti-
 tutes  reimbursement for training provided to the worker by the employer
 or by a third party.]
   4. "TRANSFERABLE CREDENTIAL" SHALL MEAN ANY DEGREE, DIPLOMA,  LICENSE,
 CERTIFICATE,  OR  DOCUMENTED  EVIDENCE  OF  SKILL  PROFICIENCY OR COURSE
 COMPLETION THAT IS WIDELY RECOGNIZED BY EMPLOYERS IN THE RELEVANT INDUS-
 TRY AS A QUALIFICATION FOR EMPLOYMENT,  INDEPENDENT  OF  THE  EMPLOYER'S
 SPECIFIC  BUSINESS  PRACTICES, OR THAT PROVIDES SKILLS OR QUALIFICATIONS
 THAT  DEMONSTRABLY  ENHANCE  THE  EMPLOYEE'S  EMPLOYABILITY  WITH  OTHER
 EMPLOYERS  IN  THE  RELEVANT  INDUSTRY. NOTWITHSTANDING THE FOREGOING, A
 "TRANSFERABLE CREDENTIAL" SHALL NOT INCLUDE:
   (A) EMPLOYER-SPECIFIC OR NON-TRANSFERABLE  TRAINING.  (I)  INSTRUCTION
 REGARDING  THE  EMPLOYER'S  PROPRIETARY  PROCESSES, PROPRIETARY SYSTEMS,
 INTERNAL POLICIES, PROPRIETARY SOFTWARE, OR PROPRIETARY EQUIPMENT UNIQUE
 TO THE EMPLOYER, OR (II) INSTRUCTION THAT DOES NOT QUALIFY THE  EMPLOYEE
 FOR  A  NEW  OCCUPATIONAL  TITLE, CLASSIFICATION, OR INDUSTRY-RECOGNIZED
 CREDENTIAL AND INSTEAD CONSISTS OF SKILLFUL VARIATIONS OF GENERAL  PROC-
 ESSES KNOWN TO THE RELEVANT TRADE OR INDUSTRY.
   (B)  MANDATED SAFETY AND COMPLIANCE TRAINING. ANY TRAINING REQUIRED BY
 FEDERAL, STATE, OR LOCAL LAW TO MAINTAIN WORKPLACE SAFETY, INCLUDING BUT
 NOT LIMITED TO OSHA CERTIFICATIONS,  SEXUAL  HARASSMENT  PREVENTION,  OR
 DIVERSITY TRAINING.
   § 2.  Section 1052 of the labor law, as added by a chapter of the laws
 of 2025 amending the labor law relating to enacting the "trapped at work
 act",  as  proposed in legislative bills numbers S. 4070-B and A. 584-C,
 is amended to read as follows:
   § 1052. Prohibiting the use of employment promissory notes  and  other
 similar  provisions.   1. [Beginning on the effective date of this arti-
 cle, no] NO employer may require, as  a  condition  of  employment,  any
 [worker] EMPLOYEE or prospective [worker] EMPLOYEE to execute an employ-
 ment  promissory note. The execution of an employment promissory note as
 a condition of employment is unconscionable, against public policy,  and
 unenforceable,  and  any  such  note shall be null and void. If any such
 note is part of a larger agreement, the invalidity of  such  note  shall
 not affect the other provisions of such agreement.
   2. Nothing in this section shall prohibit or render void or unenforce-
 able any agreement between [a worker] AN EMPLOYEE and an employer that:
   (a)  requires the [worker] EMPLOYEE to [repay to the employer any sums
 advanced to such worker by the employer, unless such sums were  used  to
 pay for training related to the worker's employment with the employer;
   (b)  requires  the  worker to pay the employer for any property it has
 sold or leased to such worker;] REIMBURSE THE EMPLOYER FOR THE  COST  OF
 TUITION,  FEES,  AND  REQUIRED  EDUCATIONAL MATERIALS FOR A TRANSFERABLE
 CREDENTIAL THAT MEETS ALL OF THE FOLLOWING REQUIREMENTS:
   (I) THE AGREEMENT IS SET FORTH IN A WRITTEN CONTRACT THAT  IS  OFFERED
 SEPARATELY FROM ANY CONTRACT FOR EMPLOYMENT.
   (II)  THE AGREEMENT DOES NOT REQUIRE THE EMPLOYEE TO OBTAIN THE TRANS-
 FERABLE CREDENTIAL AS A CONDITION OF EMPLOYMENT.
 S. 8822                             3
 
   (III) THE AGREEMENT SPECIFIES THE REPAYMENT AMOUNT BEFORE THE EMPLOYEE
 AGREES TO THE CONTRACT, AND THE REPAYMENT AMOUNT  DOES  NOT  EXCEED  THE
 COST  TO  THE  EMPLOYER  OF  THE TUITION, FEES, AND REQUIRED EDUCATIONAL
 MATERIALS FOR THE TRANSFERABLE CREDENTIAL RECEIVED BY THE EMPLOYEE.
   (IV) THE AGREEMENT PROVIDES FOR A PRORATED REPAYMENT AMOUNT DURING ANY
 REQUIRED  EMPLOYMENT  PERIOD THAT IS PROPORTIONAL TO THE TOTAL REPAYMENT
 AMOUNT AND THE LENGTH OF THE REQUIRED EMPLOYMENT  PERIOD  AND  DOES  NOT
 REQUIRE  AN  ACCELERATED PAYMENT SCHEDULE IF THE EMPLOYEE SEPARATES FROM
 THE EMPLOYMENT.
   (V) THE AGREEMENT DOES NOT REQUIRE REPAYMENT TO THE  EMPLOYER  BY  THE
 EMPLOYEE IF THE EMPLOYEE IS TERMINATED, EXCEPT IF THE EMPLOYEE IS TERMI-
 NATED FOR MISCONDUCT.
   (B)  REQUIRES  THE  EMPLOYEE  TO PAY THE EMPLOYER FOR ANY PROPERTY THE
 EMPLOYER HAS SOLD OR LEASED TO THE EMPLOYEE, AS LONG  AS  SUCH  SALE  OR
 LEASE WAS VOLUNTARY.
   (C)  REQUIRES  THE  EMPLOYEE  TO  REPAY  A FINANCIAL BONUS, RELOCATION
 ASSISTANCE, OR OTHER NON-EDUCATIONAL INCENTIVE OR OTHER PAYMENT OR BENE-
 FIT 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.
   [(c)] (D) requires educational personnel to comply with any  terms  or
 conditions of sabbatical leaves granted by their employers; or
   [(d)]  (E)  is  entered  into  as  part  of a program agreed to by the
 employer and its [workers'] EMPLOYEES' collective  bargaining  represen-
 tative.
   §  3.    Subdivision 2 of section 1053 of the labor law, as added by a
 chapter of the laws of 2025 amending the labor law relating to  enacting
 the  "trapped  at work act", as proposed in legislative bills numbers S.
 4070-B and A. 584-C, is amended to read as follows:
   2. AN EMPLOYEE OR PROSPECTIVE EMPLOYEE WHO IS AGGRIEVED BY A VIOLATION
 OF THIS ARTICLE MAY FILE A COMPLAINT WITH THE COMMISSIONER. Any employer
 [found] DETERMINED BY THE COMMISSIONER to  have  violated  this  article
 shall  be  fined  by the commissioner not less than one thousand dollars
 and not more than five thousand dollars for each violation. IN ASSESSING
 THE AMOUNT OF THE PENALTY, THE COMMISSIONER SHALL GIVE DUE CONSIDERATION
 TO THE SIZE OF THE EMPLOYER'S BUSINESS, THE  GOOD  FAITH  BASIS  OF  THE
 EMPLOYER TO BELIEVE THAT ITS CONDUCT WAS IN COMPLIANCE WITH THE LAW, THE
 GRAVITY  OF  THE VIOLATION, AND THE HISTORY OF PREVIOUS VIOLATIONS. Each
 [worker] EMPLOYEE or prospective  [worker]  EMPLOYEE  whom  an  employer
 required  to  execute  an  employment promissory note or against whom an
 employer seeks to enforce  such  a  note  shall  constitute  a  separate
 violation of this article.
   § 4. Section 3 of a chapter of the laws of 2025 amending the labor law
 relating  to enacting the "trapped at work act", as proposed in legisla-
 tive bills numbers S. 4070-B  and  A.  584-C,  is  amended  to  read  as
 follows:
   §  3. This act shall take effect [immediately] ONE YEAR AFTER IT SHALL
 HAVE BECOME A LAW.
   § 5. This act shall take effect immediately; provided,  however,  that
 sections  one,  two, and three of this act shall take effect on the same
 date and in the same manner as a chapter of the laws  of  2025  amending
 the  labor  law  relating  to  enacting  the  "trapped  at work act", as
 proposed in legislative bills numbers S.  4070-B  and  A.  584-C,  takes
 effect.