Governor Hochul Signs “Trapped at Work Act”
Over the past decade, particularly after the COVID-19 pandemic, employers in New York have increasingly adopted a “stay or pay” approach with new workers, often requiring that they sign an agreement promising to repay certain training expenses if they quit the job within a certain period of time. As of December 19, 2025, when Governor Kathy Hochul signed Senate Bill S4040-B, such actions are no longer legal.
An amendment to the New York Labor Law, S4070-B, also known as the “Trapped at Work Act,” bans all types of agreements that require an employee to pay the employer (or the employer’s agent or assignee) any sum of money if the worker leaves before the passage of a specified period of time. The new law also expressly states that an employer may not circumvent the law by referring to such a payment as a “reimbursement.”
The law does, however, identify four specific exceptions to the ban:
- Payroll advances not related to training
- Agreements related to sabbatical leave for academics, teachers or educational personnel
- Payments for employer property sold or leased to the worker
- Payments specifically permitted by a collective bargaining agreement
How Does This Law Affect New York Employers?
Violations of this new law may subject an employer to fines of anywhere from $1,000 to $5,000 per incident. Affected workers may also be able to recover attorney fees from an employer.
Let Stephen Hans & Associates Protect Your Rights as an Employer in New York
At Stephen Hans & Associates, we have successfully advised and represented many New York City employers many years, helping them meet employment law requirements and protecting their rights in employment litigation. Susan Lacerte, executive director of the Queens Botanical Garden has lauded us for our “dedication, knowledge and experience” and for helping the Botanical Gardens “successfully resolve difficult legal issues with [our] talent, negotiating skills, personal care and attention.”
Our experienced attorneys are glad to answer your questions and provide legal advice. Our offices are conveniently located in Long Island City with easy access from Manhattan.