Connecticut has joined the growing list of states regulating the use of artificial intelligence in the workplace. On May 27, 2026, Governor Ned Lamont signed the Connecticut Artificial Intelligence Responsibility and Transparency Act (SB 5) into law. The legislation creates new compliance requirements for employers that use AI-driven tools to assist with hiring, promotions, performance evaluations, compensation decisions, layoffs, or other employment-related decisions. While most of the law does not take effect until October 2027, employers should begin preparing now.

What Is Covered?

The law applies to employers that use Automated Employment-Related Decision Technology (AEDT)—a broad category that includes AI tools that generate recommendations, rankings, scores, classifications, or other outputs that materially influence employment decisions.

Importantly, the law focuses on how AI is used, not what a vendor calls the product. Even tools marketed as “assistive” or “analytics” platforms may fall within the law if they significantly influence employment decisions.

New Notice Requirements

Beginning October 1, 2027, employers using covered AI tools must provide notice to Connecticut employees and job applicants when AI is being used as a substantial factor in an employment decision.

The notice must disclose:

• That AI technology is being used.

• The purpose of the technology.

• The employment decision being evaluated.

• The categories of personal data being analyzed.

• The source of that data.

• Contact information for the employer.

Failure to comply may result in enforcement by the Connecticut Attorney General under the state’s unfair trade practices laws.

AI Is Not a Defense to Discrimination Claims

Beginning October 1, 2026, Connecticut law will expressly provide that employers cannot avoid liability for discrimination by claiming that an AI system made the decision.

In other words, if an AI-driven hiring, promotion, compensation, or termination decision produces a discriminatory result, the employer remains responsible.

The law does, however, encourage employers to conduct bias testing and other proactive reviews of AI systems. Courts and regulators may consider evidence of anti-bias testing when evaluating discrimination claims.

Additional WARN Act Reporting

Connecticut employers issuing WARN notices for mass layoffs will also be required to disclose whether the workforce reduction was related to the use of artificial intelligence or other technological changes.

Forework Takeaway

Employers should begin inventorying all workplace AI tools and determine:

• What decisions the technology influences.

• What employee or applicant data is being analyzed.

• Whether AI-generated recommendations affect hiring, promotion, discipline, compensation, or termination decisions.

• Whether vendors can provide documentation regarding bias testing and compliance support.

As more states enact AI regulations, employers should expect increasing scrutiny of workplace technology. Organizations that understand their AI tools, document their decision-making processes, and conduct regular compliance reviews will be in the strongest position to navigate this rapidly evolving area of employment law.

The U.S. Department of Labor (DOL) recently issued guidance that gives employers more flexibility when designing bonus programs for nonexempt employees. In Opinion Letter FLSA2026-6, the DOL endorsed a bonus structure that allows employers to establish a bonus pool after a performance period has ended while still avoiding the complex overtime recalculations that often accompany nondiscretionary bonuses. For employers seeking to reward employees while maintaining greater control over labor costs, the guidance provides a potentially valuable compliance tool.

Why Bonus Programs Create Overtime Challenges

Under the Fair Labor Standards Act (FLSA), most nondiscretionary bonuses must be included in an employee’s regular rate of pay when calculating overtime. As a result, employers frequently must recalculate overtime earnings and pay additional overtime amounts after bonuses are awarded—a process that can be administratively burdensome, especially when bonuses are earned over several months or an entire year. 

Historically, employers could avoid these additional calculations by paying a bonus as a percentage of an employee’s total earnings, including overtime earnings. Because the bonus automatically increased along with overtime pay, the overtime component was considered already included.

The downside? Employers often could not predict the total cost of the program until the performance period ended.

The New Bonus Pool Approach

The DOL has now confirmed that employers may establish a total bonus pool after the performance period concludes and distribute the funds proportionally based on each employee’s share of total earnings.  For example, if an employer establishes a $100,000 bonus pool and an employee earned 5% of the total earnings of all eligible participants during the performance period, that employee would receive 5% of the bonus pool.

This approach allows employers to determine the total amount they wish to spend on bonuses after reviewing financial results, rather than committing to an unknown payout amount in advance.

What Employers Need to Know

The DOL emphasized that employers cannot use this structure to avoid overtime obligations. To remain compliant:

• Bonus calculations must be genuinely tied to employee earnings.
• Employers cannot simply assign fixed bonus amounts and retroactively label them as percentage-based bonuses.
• Certain payments that are excluded from the regular rate of pay, such as discretionary bonuses and expense reimbursements, generally cannot be included when calculating bonus percentages.
• Bonus plans should be carefully structured and documented before implementation.

Forework Takeaway

This guidance provides employers with a valuable opportunity to balance employee incentives with budget certainty. However, bonus structures involving nonexempt employees remain one of the most common areas for wage-and-hour mistakes. Employers should review existing bonus programs to ensure they comply with both federal and state overtime requirements before implementing any new compensation strategy.

Virginia has joined the growing list of states requiring employers to provide paid sick leave to employees.  While the law’s implementation will be phased in over several years based on employer size, businesses should not wait until the last minute to prepare. Paid leave laws often require significant updates to payroll systems, employee handbooks, leave policies, recordkeeping procedures, and manager training.  For employers with operations in Virginia, now is the time to evaluate whether existing leave programs are equipped to meet the new requirements.

Who Will Be Affected?

Virginia’s new paid sick leave law will eventually apply to nearly all employers in the Commonwealth.  The rollout schedule is based on employer size:

• Employers with 50 or more employees must comply beginning July 1, 2027
• Employers with 25 or more employees must comply beginning January 1, 2028
• Employers with at least one employee must comply beginning January 1, 2029

Although these deadlines may seem distant, employers that operate in multiple states should begin assessing how Virginia’s requirements fit within their broader leave administration strategy.

How Sick Leave Will Accrue

Under the new law, employees will earn:

One hour of paid sick leave for every 30 hours worked

Employees may accrue and use up to 40 hours annually unless an employer chooses to provide a more generous benefit.

Employers may also choose a front-loading approach by providing the full annual allotment at the beginning of the year rather than tracking accruals throughout the year.  For many organizations, this decision will come down to administrative efficiency, payroll capabilities, and workforce demographics.

Existing PTO Policies May Already Help

The good news for many employers is that the law does not necessarily require creating a separate sick leave bank.  Organizations that already provide paid time off (PTO) may satisfy the law if their existing policy:

• Provides sufficient leave
• Allows leave to be used for the same qualifying reasons
• Meets the law’s operational requirements

This makes policy review particularly important before investing in new leave structures.

Payroll and HR Systems Will Need Attention

One of the biggest compliance challenges will be accurate leave tracking.  Employers must account for:

• Accruals
• Carryover rules
• Rehires
• Employee transfers
• Successor employer obligations
• Leave usage tracking

Employees rehired within 12 months must have previously accrued unused leave reinstated, creating additional administrative complexity.  Organizations relying on manual tracking methods may find compliance increasingly difficult as leave requirements continue expanding nationwide.

The Definition of “Family Member” Is Broad

Like many modern paid leave laws, Virginia’s definition of family member extends well beyond traditional immediate family relationships. The law covers a wide range of caregiving situations and recognizes that employees often provide care for individuals outside traditional family structures.  For employers, this means managers should avoid making assumptions about whether a leave request qualifies.

Documentation Rules Are Employee-Friendly

The law limits the circumstances under which employers can require documentation. Generally, documentation may only be requested after an employee has used three or more consecutive workdays of leave.  Even then, employers face restrictions on the information they may request and must protect the confidentiality of any medical or sensitive personal information they receive. Organizations should review existing attendance and documentation policies to ensure they align with these requirements.

New Notice and Recordkeeping Obligations

Employers will also be required to:

• Provide written notice of employee rights
• Post notices in the workplace
• Maintain records of leave accrual and usage
• Retain records for at least three years

Recordkeeping requirements continue to be a growing area of regulatory focus across employment laws, making documentation systems more important than ever.

Why Multi-State Employers Should Pay Attention

Across the country, states and local jurisdictions continue expanding employee leave rights, often with different accrual formulas, usage requirements, notice rules, and recordkeeping obligations.

As these laws multiply, compliance becomes increasingly difficult for employers attempting to manage leave manually or through disconnected systems.  What works in one state may not satisfy requirements in another.

Questions Employers Should Be Asking Now

Before the law takes effect, employers should evaluate:

• Whether current PTO policies satisfy the new requirements
• How leave accruals are currently tracked
• Whether payroll systems can manage carryovers and reinstatements
• How leave records are maintained
• Whether managers understand leave-related protections
• How employee notices will be distributed and tracked

The employers that begin planning early will face a far smoother implementation process.

Forework’s Perspective

Forework has extensive experience assisting employers with State and City-based paid sick leave requirements. Our payroll is configured to meet these requirements from day 1 of the law’s implementation, and we our employment attorneys work with clients to prepare the initial and ongoing written policy requirements for companies that have local or state-specific paid sick leave obligations.  

Employers operating in Chicago face a new round of scheduling compliance requirements beginning June 1, 2026.

The City of Chicago recently adopted significant amendments to its Fair Workweek regulations, expanding employer obligations related to scheduling, employee consent, predictability pay, recordkeeping, and workforce communication.  In this alert, we break down the amendments and implications for covered employers.  

Why This Matters

Fair Workweek laws are designed to provide employees with greater schedule stability and predictability. While these requirements have existed in Chicago since 2020, the new rules provide additional guidance and create more detailed compliance expectations for employers. The biggest takeaway is that employers must now maintain stronger documentation and exercise greater control over scheduling changes.

Covered Employers Should Pay Attention

The ordinance generally applies to employers in industries such as Healthcare, Retail, Restaurants, Hospitality, Manufacturing, Warehouse operations, and Building services.  Coverage is determined using global employee headcount rather than local staffing levels.  For larger employers with hourly workforces, these rules can affect scheduling procedures, payroll calculations, employee communications, and record retention practices.

Scheduling Changes Just Became More Expensive

One of the most important changes involves Predictability Pay. Under the revised rules, employers may owe additional compensation whenever they make certain schedule changes after a schedule has been posted. Even relatively small changes can trigger compliance obligations. 

The city also clarified that employee consent must be written, time-stamped, and specific to the schedule change.  General blanket consent forms will not satisfy the requirement.  For employers, this means informal scheduling practices that once seemed harmless could now create compliance risk.

Documentation Is Becoming Critical

The new rules place significant emphasis on recordkeeping. Employers must be able to demonstrate compliance with requirements involving:

• Schedule postings
• Employee consent
• Predictability Pay
• Right-to-Rest provisions
• Schedule modifications

If documentation does not exist, employers may struggle to prove compliance during an audit or investigation.

Organizations relying on manual scheduling methods, text messages, spreadsheets, or inconsistent manager practices may want to evaluate whether their current processes provide sufficient documentation.

Advance Scheduling Requirements Are More Detailed

Employers must continue providing schedules at least 14 days in advance, but the city has added additional requirements regarding how schedules are prepared and maintained.  Schedules must now contain more detailed information and be properly documented.  The city also clarified expectations regarding on-call shifts, which must be included when providing schedule estimates. For employers that rely heavily on fluctuating staffing levels, these requirements may require more sophisticated workforce planning.

Right-to-Rest Rules Require Additional Attention

Chicago’s Fair Workweek Ordinance continues to provide employees with the right to decline shifts that begin less than ten hours after a prior shift.  Employees may voluntarily agree to work those shifts, but the consent must be properly documented.  When such shifts are worked, employers generally must provide premium compensation.  This is an area where scheduling and payroll systems must work together to ensure compliance.

Payroll Teams May Feel the Impact

Many employers think of Fair Workweek laws as an HR or operations issue.  In reality, payroll departments often bear the burden of ensuring compliance.  The updated rules require employers to:

• Track Predictability Pay
• Apply premium pay when required
• Maintain supporting documentation
• Properly reflect certain payments on wage statements

As scheduling laws become more complex, payroll accuracy becomes increasingly important.

Questions Employers Should Be Asking

Organizations operating in Chicago should evaluate:

• How scheduling changes are currently documented
• Whether employee consent is properly recorded
• How Predictability Pay is calculated
• Whether managers understand scheduling restrictions
• Whether payroll systems can accurately track required premium payments
• Whether scheduling and payroll data are integrated

These questions become especially important for employers with multiple locations or decentralized management structures.

Forework’s Perspective

Covered employers must review these amendments and audit their payroll and HR practices to ensure that they are in compliance with these requirements.  Forework works with Chicago employers to assist them in determining coverage, scope of their obligations, and implementation of the law’s requirements.  

Many employers use employment agreements that attempt to shorten the amount of time employees have to bring legal claims against the company. A recent federal appeals court decision serves as an important reminder that these provisions may not always be enforceable.

In a ruling that could influence employment practices across the country, the U.S. Court of Appeals for the Fourth Circuit held that employers cannot use pre-employment agreements to shorten the time employees have to pursue discrimination claims under certain federal employment laws.

While the decision currently applies only within the Fourth Circuit, it highlights an important compliance issue for employers that rely on standardized offer letters, employment agreements, or onboarding documents.

The Issue: Contractual Deadlines vs. Federal Employment Rights

Many employment agreements contain provisions that require employees to bring workplace claims within a shortened period of time—often six months or 180 days.  Employers often include these provisions to create certainty and avoid defending stale claims years after an event occurred.  However, federal anti-discrimination laws operate under a unique process that requires employees to first file a charge with the Equal Employment Opportunity Commission (EEOC) before filing a lawsuit. That administrative process can take months—or even longer—before an employee receives authorization to proceed to court. The Fourth Circuit concluded that employers cannot use private agreements to effectively cut short that statutory process.

Why This Matters

The court’s decision specifically impacts claims brought under:

• Title VII of the Civil Rights Act of 1964
• The Age Discrimination in Employment Act (ADEA)

These laws govern many of the most common workplace discrimination claims, including allegations involving:

• Race discrimination
• Sex discrimination
• Religious discrimination
• National origin discrimination
• Age discrimination

Because employees must first go through the EEOC process before filing suit, the court found that employers cannot contractually reduce the time available for employees to exercise those rights.

What Employers Should Review

Employers should take this opportunity to review:

Employment Agreements

Examine offer letters, employment contracts, arbitration agreements, and onboarding documents for language that shortens legal filing deadlines.

Multi-State Compliance

Organizations operating in multiple states should be especially cautious. Different courts may interpret these provisions differently, and agreements that were once considered standard may face increasing legal scrutiny.

HR Policies and Onboarding Practices

Employers should ensure HR teams understand which contractual provisions remain enforceable and which may create unnecessary legal risk.

Legal Templates

Many companies continue to use employment agreement templates that were drafted years ago. Those documents should be periodically reviewed to ensure they remain compliant with evolving legal standards.

The Bigger Trend

This decision reflects a broader trend among courts and regulators: increased scrutiny of employment agreements that may limit employee rights under federal workplace laws.

As workplace compliance requirements continue to evolve, employers should view employment agreements as living documents rather than “set it and forget it” paperwork.

Regular reviews of employment policies, onboarding materials, arbitration agreements, and employee handbooks can help organizations reduce risk while maintaining compliance with changing legal requirements.

Forework’s Perspective

Employment compliance doesn’t begin when a claim is filed—it begins with the systems, documents, and processes employers use every day. As regulations and court decisions continue to reshape the workplace landscape, employers should regularly evaluate their onboarding documentation, HR practices, and compliance procedures to ensure they align with current legal requirements. A proactive review today can help prevent costly disputes tomorrow.

Connecticut employers should prepare now for a wave of new workplace regulations that will affect hiring practices, payroll administration, employee communications, workplace accommodations, and the use of artificial intelligence in employment decisions.

The Connecticut General Assembly recently passed sweeping legislation that introduces new requirements for wage transparency, payroll disclosures, accommodation notices, employee retention obligations, and AI-driven employment tools. While many of the provisions do not take effect until late 2026 or 2027, employers that begin planning now will be in a much stronger position to avoid compliance challenges later.

At Forework, we believe compliance starts long before a law becomes effective. Employers should use this lead time to evaluate payroll processes, recruiting practices, job posting procedures, employee communications, and HR technology platforms.

Below are the key developments employers should be monitoring.

1. Job Postings Must Include Pay Ranges and Benefits Information

Beginning October 1, 2026, Connecticut employers will be required to include:

• A good-faith wage range
• A general description of benefits

in both internal and external job postings.

This expansion goes beyond Connecticut’s existing wage transparency requirements and will impact recruiting, compensation planning, and internal promotion processes.

For employers with remote workforces, the law may apply even when employees work outside Connecticut if they report to a Connecticut-based supervisor or office.

What Employers Should Do Now

• Review job posting templates
• Establish documented salary ranges for positions
• Coordinate compensation and recruiting teams
• Ensure benefits descriptions are standardized and consistent

2. New Restrictions on Employee Repayment Agreements

Connecticut is expanding its prohibition on employment promissory notes to all employers, regardless of size.

Agreements that require employees to repay training costs or similar expenses as a condition of employment may become unenforceable if they fall within the law’s definition of an employment promissory note.

What Employers Should Do Now

• Review training reimbursement agreements
• Audit onboarding documents
• Evaluate retention and workforce development programs

3. New Disability Accommodation Notice Requirements

Beginning October 1, 2026, employers must provide employees with notice of their rights to workplace accommodations under the Americans with Disabilities Act (ADA).

The notice requirement applies:

• To all new hires
• To current employees
• When an employee informs the employer of a disability

What Employers Should Do Now

• Update onboarding materials
• Review ADA policies and procedures
• Prepare for distribution of required notices

4. Expanded Lactation Accommodation Obligations

The new law reinforces employers’ obligations to provide reasonable break time for nursing employees and to maintain appropriate lactation spaces.

The legislation makes clear that employers must provide break time beyond regularly scheduled breaks when necessary.

What Employers Should Do Now

• Review workplace accommodation policies
• Confirm designated lactation spaces meet legal requirements
• Train managers on accommodation requests

5. New Payroll Transparency Requirements for Larger Employers

One of the most significant operational changes affects employers with 100 or more employees.

Beginning October 1, 2026, covered employers must provide employees with a guide explaining payroll codes used for overtime and common pay differentials.

These pay codes often appear on pay statements as abbreviations that employees may not understand.

Examples include:

• Overtime codes
• Shift differentials
• Holiday pay
• Weekend premiums
• Hazard pay
• On-call compensation

The guide must be maintained and updated as payroll practices evolve.

Why This Matters

Payroll transparency is becoming a growing focus among regulators nationwide. Employers should ensure their payroll systems produce information that employees can easily understand and verify.

For organizations using third-party payroll providers, now is a good time to determine whether your provider can support these requirements.

6. Construction Industry Employers Face New Wage Liability Exposure

Construction contractors will face expanded responsibility for unpaid wages owed by subcontractors.

The law creates joint liability provisions that significantly increase the importance of subcontractor oversight and payroll compliance monitoring.

What Employers Should Do Now

• Review subcontractor agreements
• Strengthen payroll audit procedures
• Evaluate wage compliance monitoring practices

7. Successor Employers May Be Required to Retain Existing Workers

Beginning July 1, 2027, certain businesses taking over service contracts or acquiring covered properties may be required to retain existing employees for a transition period.

The law affects industries that rely heavily on:

• Janitorial services
• Security services
• Building maintenance
• Facilities management
• Property operations

Employers involved in acquisitions, outsourcing arrangements, or service contract transitions should incorporate these obligations into workforce planning efforts.

8. Artificial Intelligence in Employment Decisions Faces New Regulation

Connecticut is also moving toward increased regulation of AI tools used in employment decisions.

Employers using automated technologies for:

• Recruiting
• Applicant screening
• Hiring decisions
• Promotions
• Discipline
• Performance evaluations
• Terminations

may soon face new notice and disclosure requirements.

The legislation requires greater transparency regarding how automated systems are used and what information is analyzed when employment decisions are made.

Why Employers Should Pay Attention

Many organizations are already using AI-enabled recruiting and HR platforms without fully understanding how those systems operate.

Employers should begin:

• Inventorying AI-powered HR tools
• Reviewing vendor agreements
• Assessing potential bias-testing capabilities
• Evaluating compliance documentation

Organizations that wait until the law becomes effective may find themselves scrambling to gather information from software vendors.

Forework’s Perspective

The most important takeaway from Connecticut’s 2026 legislative session is that workforce compliance is becoming increasingly connected to payroll data, compensation practices, employee communications, and HR technology.

Many of these requirements cannot be addressed solely through policies. They require operational systems that support transparency, consistency, and accurate workforce administration.

Employers that take a proactive approach now will be far better positioned when these laws take effect.

Forework will continue monitoring these developments and helping employers align their payroll, workforce management, and compliance processes with the evolving regulatory landscape.

A bill recently passed by the New York Legislature could significantly change how employers manage employee personnel records. If signed by Governor Hochul, the legislation would create new requirements for providing employees access to their personnel files, responding to record requests, documenting disciplinary actions, and retaining employment records after separation.

While many employers already maintain personnel files, most employers do not have a policy of making ALL personnel (or any personnel) information available as a matter of regular course. Instead, most companies decide, on a case by case basis, if and how much of personnel file information to make available to current and former employees.  Thus, this proposal would transform employee access from a per-company policy issue into a legal obligation—with strict deadlines and potential penalties for noncompliance.

What the Proposed Law Would Require

Under the legislation, employers would be required to provide current and former employees with copies of their personnel records within five business days of receiving a written request.

Records would need to be provided: 

• At no cost to the employee
• Within five business days
• For both current and former employees

The proposal also includes anti-retaliation protections for employees who exercise these rights.

What Counts as a Personnel Record?

The bill uses a broad definition of personnel records. Potentially covered documents include: employment applications, performance evaluations, disciplinary records, promotion documentation, compensation-related records and transfer and job history records.  In practical terms, many of the documents HR professionals rely upon when making employment decisions could become accessible to employees upon request.

A Major Change: Notice of Negative Information

Perhaps the most significant operational change is a new requirement that employers notify employees when negative information is added to their personnel file.

Under the proposal:

• Employees must be notified within 10 days
• Employees may submit a written response
• The employer must retain that response alongside the original record
• The response may need to accompany the record when it is later disclosed

This requirement would create a level of transparency that many employers do not currently maintain.

For organizations with decentralized management structures, ensuring timely notification could become a significant administrative challenge.

New Record Retention Requirements

The legislation would also require employers to maintain personnel records for at least three years after employment ends.

While many employers already retain records longer than this for litigation and compliance purposes, organizations without formal retention procedures may need to revisit their recordkeeping practices.

Why HR Leaders Should Pay Attention

If enacted, this law would impact much more than personnel files.

It would affect:

Documentation Practices

Managers and supervisors may need additional training on how performance concerns, coaching conversations, and disciplinary actions are documented.

HR Response Procedures

Organizations will need processes for receiving, tracking, and responding to personnel record requests within a short timeframe.

File Organization

Employers with paper files, decentralized records, or inconsistent documentation practices may face challenges locating records quickly enough to meet statutory deadlines.

Employee Relations

Because employees would gain easier access to personnel records, employers should expect greater scrutiny of evaluations, disciplinary records, and employment decisions.

Questions Employers Should Be Asking Now

Even before the bill becomes law, employers may benefit from evaluating:

• Where personnel records are currently stored
• Whether records are centralized and easily accessible
• How disciplinary information is documented
• Whether managers receive training on documentation standards
• Whether current retention policies are sufficient

Organizations that wait until the law takes effect may find themselves scrambling to create processes that should have been established months earlier.

Forework’s Perspective and Advantage

Workforce compliance increasingly depends on having organized, accessible, and accurate employee data.  Whether it’s payroll records, timekeeping information, personnel files, or performance documentation, employers are facing growing expectations for knowing what records to keep, maintaining such records completely, accurately and consistently, and having that information available for regulator review and inspection on short-notice. Forework provides all clients with an attorney-reviewed and approved record retention checklist, and ensures that all employers are maintaining the records required to be maintained by law, as well as those records where it is best practice to maintain.  The records are maintained digitally, where available, and employees may (depending on employer choice) have access to some or all of their personnel files in digital format. 

In early 2025, New York quietly added a new question to its WARN Act filing system: did AI or automation contribute to these layoffs? More than a year later, not one of the 160-plus companies that filed a notice has said yes.  That’s either genuinely good news — or a sign that the reporting system isn’t working the way it was intended.

How the disclosure works

Governor Hochul directed the state’s Department of Labor to start collecting this data in January 2025, with the change going live in March. When filing a WARN notice, employers now see a checkbox asking whether “technological innovation or automation” played a role in the layoffs. If checked, they’re asked to name the specific technology.

The problem is that New York’s WARN Act statute was never actually amended to require this — it was just added to the form. That leaves employers with real uncertainty: Is this mandatory? What counts as “technological innovation or automation”? Does AI need to be the sole cause of the layoffs, or just a contributing factor? Without answers, most employers are probably leaving the box unchecked regardless.

What might be coming

Two bills in the state legislature would go further:

One would require larger employers — those with 100 or more employees, or any publicly traded company — to submit annual reports to the state on how AI is affecting hiring, workforce reductions, and unfilled positions. It would also require disclosure of how AI is being overseen and how often it’s being used.

The other, called the “Automation Displacement Protection Act,” would require employers with 50 or more full-time employees to give advance notice any time AI or automated technology eliminates positions or cuts workforce hours by 25% or more over a 12-month period. Affected employees would be entitled to a 90-day transition period with either continued pay or access to retraining. Employers who don’t comply could lose eligibility for state grants, loans, and tax incentives for five years — and face civil penalties up to $10,000 per day for willful violations.

Neither bill is law yet, but the direction of travel is clear. New York has been at the front of AI-related workplace regulation, and other states are paying attention.

Employers — especially those operating in multiple states — should be monitoring these developments closely and thinking now about how they would track and report AI’s role in workforce decisions if required to do so.

FOREWORK BENEFIT: Federal and state WARN Act obligations are extremely tricky, even without a AI component.   Employers who are considering shutting down locations, departments, or conducting a mass layoff of employees form multiple branches and divisions should consul their designated Forework human resources representative.

The EEOC recently submitted a plan to the White House to eliminate annual employer reporting requirements — including the EEO-1 Report, which has been required since 1966. If finalized, the change would also scrap similar reports for local unions, state and local governments, and public schools.

Currently, private employers with 100 or more employees must submit race, ethnicity, sex, and job category data annually by location. Federal contractors with 50 or more employees have the same obligation.

The proposal follows pressure from within the administration to align EEOC practices with executive orders ending DEI programs and policies. Efforts in Congress to preserve the reporting requirement through appropriations language did not gain traction.

But none of this means employers should change anything yet. Here are three things to avoid doing right now:

1. Don’t assume EEO-1 reporting is off the table for 2026. The current regulation still requires employers to file by September 30 each year. The administrative process to formally rescind that requirement takes time — and it may not be complete before this fall’s deadline. Treat the obligation as fully in effect until you hear otherwise officially.

2. Don’t stop collecting employee demographic data. Even if the federal reporting requirement goes away, Title VII’s recordkeeping rules remain. Federal guidelines still require employers to maintain data showing whether their hiring and selection practices have a disparate impact based on race, ethnicity, or sex. Keep requesting that information at the time of hire.

3. Don’t overlook your state obligations. California and Illinois already have their own employer reporting requirements. Massachusetts currently ties its requirement directly to the EEO-1, so changes at the federal level could prompt changes there too. And if the federal requirement disappears entirely, more states may step in with their own rules. Employers contracting with state governments may also have separate affirmative action or reporting commitments that depend on demographic data.

We’ll continue to monitor the EEOC’s proposal and update you as the situation develops — particularly as the September 30 deadline gets closer.

FOREWORK BENEFIT:  Clients of Forework who need assistance gathering data and preparing the EEO-1 report can speak with their designated Forework counsel and HR representative about the annual report obligations. 

Federal agencies recently proposed a rule that would make it simpler for employers to offer fertility benefits outside of their main health plan — without running into compliance problems under the Affordable Care Act.

Here’s the quick backstory: Under the ACA, stand-alone benefit plans (ones not integrated with a major medical plan) generally have to meet a number of coverage requirements to be compliant. There’s an exception for what are called “excepted benefits” — a defined category that includes things like dental and vision coverage. The new proposal would add fertility benefits to that list.

What the proposed rule would require

For a fertility benefit to qualify as a new “limited excepted benefit,” it would need to meet four conditions:

1. It must be offered separately from the employer’s main group health plan, and employees must be able to decline the main plan and still enroll in the fertility benefit.
2. The benefit must be primarily for the diagnosis or treatment of infertility or related reproductive health conditions.
3. Lifetime coverage cannot exceed $120,000 per participant (adjusted over time for medical inflation).
4. Participants must receive a written notice describing the benefit — at enrollment, annually, and upon request.

On that last point: a general mention buried in a Summary Plan Description won’t cut it. The agencies specifically want the notice to be short and easy to understand.

A few things to keep in mind

The proposal appears aimed at employers who don’t currently cover fertility treatments under their major medical plan, giving them a new, structured way to do so. That said, elective fertility treatments — like egg freezing for someone without an infertility diagnosis — don’t appear to be covered under this proposal as written.

If finalized, the rule would apply to plan years beginning on or after January 1, 2027. Comments on the proposal are due by July 13, 2026.

THE FOREWORK BENEFIT:  Whether you’re thinking about adding fertility benefits for the first time or you already offer them and want to make sure your current structure holds up under the new framework, Forework members can use their monthly attorney hours to work through exactly these questions — plan design, notice requirements, compliance gaps, and more.