UPDATE: New York State Amends “Stay or Pay” Ban

The New York “Trapped at Work Act” prohibits employers from requiring an “employment promissory note” as a condition of employment — defined broadly to include any agreement that requires payment to the employer for leaving before a stated time.

On February 13, 2026, Governor Hochul signed the chapter amendment to the law, delaying the effective date by one year*.

The amendment narrows coverage to “employees” and provides additional carve-outs to the broad definition of “employment promissory notes.” The new carve-outs include agreements related to repayment of bonuses, relocation assistance, and other non-educational or non-training incentives. 

The amendment introduces detailed rules for repayment of training costs associated with “transferable credentials,” defining what qualifies and expressly excluding employer specific or mandatory compliance training.

*The amendments revise the effective date of the Act to “one year after it shall have become a law.”  There is some ambiguity, however, as to whether this means one year after the signing date of the original Act (December 19, 2025) or one year after the signing of the amendments to the Act (February 13, 2026).

Proskauer:
New York State Trapped At Work Act Amended and Effective Date Delayed