Proposed Legislation Would Ban Certain Types of Promissory Notes from Workers
The New York legislature has passed a new law, referred to as the “Trapped at Work Act,” which targets a practice that some New York employers have historically used to try to hold workers financially responsible for training expenses. As in many other states, some employers in New York have required that new hires sign a promissory note related to the costs of training, with repayment waived if the employee stays with the company for a certain period of time. Though both houses of the New York state legislature have tentatively passed the new law, it has not yet been sent to Governor Kathy Hochul for her signature, though sponsors expect to do that by the end of the calendar year.
What Does the New Law Mean?
If signed by the governor, the proposed law (A584/S4070B) would prohibit the use of any agreement between an employer and an employee where the employee promises to repay a sum of money to the employer if he or she quits the job before a certain date. The bill specifically targets such agreements when the contractual reimbursement is for training expenses. The law refers to “workers,” which may include employees, independent contractors, apprentices, sole proprietors, volunteers and interns.
Are There Exceptions to the Law?
Yes. An employer may legally require repayment of:
- Sums advanced to the worker for purposes other than job training
- Any amount for property leased or sold to the worker
- Any agreements that are included in or permitted by a collective bargaining agreement
- Any such agreements related to sabbaticals for educational employees
Let the Romero Law Group Protect Your Rights as an Employee
At the Romero Law Group, PLLC, we handle a wide range of legal issues for employees in Westchester County, Rockland County and Orange County in New York; and across Northern New Jersey. We offer a free initial consultation to any employee with a potential employment law dispute. To schedule an appointment, contact our offices online or call us at (631)257-5588.