By Jamie Davila, Esq. and Ty Hyderally, Esq.

Date: July 15, 2025

The State of New York’s Department of Labor has updated their Worker Adjustment and Retaining Notification (WARN) Act to now require covered business to provide early warnings of closures and layoffs to all affected. The purpose of this advance notice is to give employees, their families, and communities time to transition, seek new employment, and enter workforce training programs with assistance from the Department of Labor and Local Workforce Development Boards[1].

In addition, New York State has become a pioneer in the world of artificial intelligence, as it is the first state in the country to now require AI to be disclosed by companies if “technological innovation or automation” contributed to mass layoffs and plant closures. The update to the act includes specifying exact technologies involved, such as AI or robotics[2].

This action seeks to highlight the use of emerging technologies and its reshaping of employment law, demanding new standards of transparency and accountability. Under the revised statute, employers must indicate if AI, machine learning, or automation was a factor in termination decisions. Companies must identify the type of technology used and the disclosure must be included in WARN filings for layoffs involving 50 or more employees. By codifying this level of transparency, New York is signaling concern that AI-driven decisions may lack human oversight and could further create bias and inequity in the workplace. Failing to comply with the new WARN provisions could result in fines, lawsuits, and reputational damage.

With New York state leading the way with its recognition of AI in the workplace and its impact to the modern workplace, other states will most likely follow suit. Although New Jersey has yet to pass an AI specific WARN amendment like New York has, it is considering legislation that would: require the disclosure of automated decision making tools used in layoffs, mandate algorithmic audits to detect bias, and expand protections for workers affected by AI-driven employment actions.

What does this mean for employers? AI is a helpful tool to streamline efficiency and production. However, it is not recommended to streamline layoffs, terminations, or hiring practices as it would increase the danger of biases and inequalities. Taking the human component out of these critical phases of hiring, terminations or layoffs will prove to be a costly mistake. Therefore, employers should be prepared to integrate new reporting requirements into the layoff planning process if operating in New York[3]. If you feel that you are being a target of discriminatory treatment or feel that you were terminated due to AI or other advances in technology, or If you have any questions regarding your rights as an employee, you should seek out an experienced attorney who concentrates in employment law. Our firm has been concentrating in employment law for over twenty-two (22) years!

En nuestra firma hablamos español. This blog is for informational purposes only. It does not constitute legal advice and may not reasonably be relied upon as such. If you face a legal issue, you should consult a qualified attorney for independent legal advice regarding your particular set of facts. This blog may constitute attorney advertising. This blog is not intended to communicate with anyone in a state or other jurisdiction where such a blog may fail to comply with all laws and ethical rules of that state or jurisdiction.

[1] Worker Adjustment and Retraining Notification (WARN), https://dol.ny.gov/worker-adjustment-and-retraining-notification-warn%29%3A#:~:text=The%20New%20York%20State%20WARN,employees%20in%20New%20York%20State (Last visited on July 8, 2025).

[2] Ronnie Dungan, First US State New York now requires companies to disclose AI-driven layoffs, June 16, 2025, https://www.hrgrapevine.com/us/content/article/2025-06-16-new-ny-law-requires-companies-to-disclose-ai-role-in-layoffs (Last visited on July 8, 2025).

[3] New York Becomes First State to Require Employers to Disclose AI’s Role in Layoffs, June 17, 2025, https://completeaitraining.com/news/new-york-becomes-first-state-to-require-employers-to/ (Last visited on July 8, 2025).