Existing law, the California Worker Adjustment and Retraining Act (Cal/WARN Act), prohibits an employer from ordering a mass layoff, relocation, or termination at a covered establishment unless, 60 days before the order takes effect, the employer gives written notice of the order to the employees affected by the order and to the Employment Development Department and certain local officials. Existing law makes an employer who fails to give specified notice regarding a mass layoff, relocation, or termination subject to a civil penalty of not more than $500 for each day of the employers violation.

This bill would revise the Cal/WARN Act to also require an employer giving notice of a mass layoff, relocation, or termination caused in whole or in substantial part by an artificial intelligence (AI) system or other automated technology replacing or automating employment positions to include certain information in the notice, including the job functions performed by workers that will be automated by AI or other automated technology. The bill would require the department to publish a summary of the notices received on its internet website and to post a quarterly statewide summary of technological displacements reported. The bill would require the department, on or before January 1, 2028, to submit a report to the Legislature on artificial intelligences effects on business hiring practices, including its impact on industries and occupations at the state and regional level. The bill would repeal the provision requiring that report on January 1, 2029.

Existing law, the California Worker Adjustment and Retraining Act (Cal/WARN Act), prohibits an employer from ordering a mass layoff, relocation, or termination at a covered establishment unless, 60 days before the order takes effect, the employer gives written notice of the order to the employees affected by the order and to the Employment Development Department and certain local officials. Existing law makes an employer who fails to give specified notice regarding a mass layoff, relocation, or termination subject to a civil penalty of not more than $500 for each day of the employers violation.

This bill would revise the Cal/WARN Act to also require an employer giving notice of a mass layoff, relocation, or termination caused in whole or in substantial part by an artificial intelligence (AI) system or other automated technology replacing or automating employment positions to include certain information in the notice, including the job functions performed by workers that will be automated by AI or other automated technology. The bill would require the department to publish a summary of the notices received on its internet website and to post a quarterly statewide summary of technological displacements reported. The bill would require the department, on or before January 1, 2028, to submit a report to the Legislature on artificial intelligences effects on business hiring practices, including its impact on industries and occupations at the state and regional level. The bill would repeal the provision requiring that report on January 1, 2029.

Existing law, the California Worker Adjustment and Retraining Act (Cal/WARN Act), prohibits an employer from ordering a mass layoff, relocation, or termination at a covered establishment unless, 60 days before the order takes effect, the employer gives written notice of the order to the employees affected by the order and to the EDD Employment Development Department and certain local officials. Existing law makes an employer who fails to give specified notice regarding a mass layoff, relocation, or termination subject to a civil penalty of not more than $500 for each day of the employers violation.

This bill would revise the Cal/WARN Act to also require an employer giving notice of a mass layoff, relocation, or termination caused in whole or in substantial part by an artificial intelligence (AI) system or other automated technology replacing or automating employment positions to include certain information in the notice, including the job functions performed by workers that will be automated by AI. AI or other automated technology. The bill would require the department to publish a summary of the notices received on its internet website and to post a quarterly statewide summary of technological displacements reported. The bill would require the department, on or before January 1, 2028, to submit a report to the Legislature on artificial intelligences effects on business hiring practices, including its impact on industries and occupations at the state and regional level. The bill would repeal the provision requiring that report on January 1, 2029.

Existing law establishes the Labor and Workforce Development Agency, which is composed of various departments responsible for protecting and promoting the rights and interests of workers in California, including the Division of Labor Standards Enforcement, led by the Labor Commissioner (commissioner), within the Department of Industrial Relations. Existing law establishes the Employment Development Department (EDD), which is administered by the Director of Employment Development. Under existing law, the Director of Employment Development is vested with specified duties, purposes, responsibilities, and jurisdiction related to job creation activity functions, among other things.

Existing law, the California Worker Adjustment and Retraining Act (Cal/WARN Act), prohibits an employer from ordering a mass layoff, relocation, or termination at a covered establishment unless, 60 days before the order takes effect, the employer gives written notice of the order to the employees affected by the order and to the EDD and certain local officials. Existing law makes an employer who fails to give specified notice regarding a mass layoff, relocation, or termination subject to a civil penalty of not more than $500 for each day of the employers violation.

This bill would revise the Cal/WARN Act to also require an employer giving notice of a mass layoff, relocation, or termination caused in whole or in substantial part by an artificial intelligence (AI) system or other automated technology replacing or automating employment positions to include certain information in the notice, including the job functions performed by workers that will be automated by AI.

The bill would additionally require an employer to provide the EDD with a written technology hiring disruption notice that contains all of specified information about the employers use of AI or other automation when that employer executes a technological cessation in hiring, as defined. specified. The bill would require the EDD to post summaries of notices received pursuant to these provisions on its internet website as part of the existing notice requirements of the Cal/WARN Act, compile quarterly summaries regarding worker displacement due to AI and automation with the report including a link to the Cal/WARN Act notice report internet website, and submit the report to specified legislative committees. The bill would make an employer who fails to give a written technology hiring disruption notice when it executes a technological cessation in hiring liable for a civil penalty of not more than $500 for each day of the employers violation. The bill would authorize the Labor Commissioner to enforce these notice requirements and would make various related, conforming changes to the Cal/WARN Act.

The bill would include findings that changes proposed by this bill address a matter of statewide concern rather than a municipal affair and, therefore, apply to all cities and counties, including charter cities and charter counties.

Existing law establishes the Labor and Workforce Development Agency, which is composed of various departments responsible for protecting and promoting the rights and interests of workers in California, including the Division of Labor Standards Enforcement, led by the Labor Commissioner (commissioner), within the Department of Industrial Relations. Existing law establishes the Employment Development Department (EDD), which is administered by the Director of Employment Development. Under existing law, the Director of Employment Development is vested with specified duties, purposes, responsibilities, and jurisdiction related to job creation activity functions, among other things.

Existing law establishes the Labor and Workforce Development Agency, which is composed of various departments responsible for protecting and promoting the rights and interests of workers in California, including the Division of Labor Standards Enforcement, led by the Labor Commissioner (commissioner), within the Department of Industrial Relations. Existing law establishes the Employment Development Department (EDD), which is administered by the Director of Employment Development. Under existing law, the Director of Employment Development is vested with specified duties, purposes, responsibilities, and jurisdiction related to job creation activity functions, among other things.

This bill would establish the California Worker Technological Displacement Act, which would require an employer, as defined, to provide at least a 60-day advanced written notice, as described, before any technological displacement affecting 25 or more workers during any 30-day period. notice before any technological displacement affecting workers, as described. The bill would require an employer to provide that notice to affected workers, the EDD, and specified local entities. The bill would also require an employer to provide a written technology hiring disruption notice to the EDD when it executes a technological cessation in hiring caused in whole by the adoption of artificial intelligence (AI) or other automating technology. The bill would impose various reporting requirements on the EDD.

For employers with more than 100 workers, this bill would entitle workers affected by technological displacement to a right of first bid on other positions with the employer, except as specified. The bill would prohibit an employer, during the 60-day period from when notice is provided to the worker, from discharging a worker affected by a technological displacement without reasonable and substantiated cause.

This bill would also require a local educational agency that provides layoff notices for classified and certificated staff or a community college district that provides layoff notices for academic and classified employees to provide the EDD with a written technology displacement or cessation in hiring notice when it executes a technological displacement or a technological cessation in hiring caused in whole by the adoption of AI or other automating technology, as specified.

This bill would make an employer that fails to give notice before ordering a technological displacement liable for back pay and benefits to each worker for a maximum of 60 days or one-half the number of days the worker was employed, whichever period is shorter. The bill would also impose subject to certain penalties, including a $500 civil penalty for each day of the employers violation, except as provided.

This bill would set forth procedures for reporting violations to the commissioner and filing a civil action in court. The bill would provide enforcement authority and related powers to the commissioner. The bill would establish the Technological Displacement Act Fund, require all civil penalties recovered by the commissioner to be deposited in the fund, and make all moneys in the fund available to the commissioner upon appropriation. The bill would also authorize the commissioner and the EDD to adopt rules and regulations to effectuate these provisions. The bill would make its provisions severable.

Existing law establishes the Labor and Workforce Development Agency, which is composed of various departments responsible for protecting and promoting the rights and interests of workers in California, including the Division of Labor Standards Enforcement, led by the Labor Commissioner (commissioner), within the Department of Industrial Relations. Existing law establishes the Employment Development Department (EDD), which is administered by the Director of Employment Development. Under existing law, the Director of Employment Development is vested with specified duties, purposes, responsibilities, and jurisdiction related to job creation activity functions, among other things.

This bill would establish the California Worker Technological Displacement Act, which would require an employer, as defined, to provide at least a 90-day 60-day advanced written notice, as described, before any technological displacement affecting 25 or more workers or 25 percent of the workforce, whichever is less. workers during any 30-day period. The bill would require an employer to provide that notice to affected workers, the EDD, and specified state and local entities. The bill would also require an employer to provide a written technology hiring disruption notice to the EDD and the local workforce investment board when it executes a technological cessation in hiring directly and primarily due to caused in whole by the adoption of artificial intelligence (AI) or other automating technology. The bill would impose various reporting requirements on the EDD.

For employers with more than 100 workers, this bill would entitle workers affected by technological displacement to a right of first bid on other positions with the employer. employer, except as specified. The bill would prohibit an employer, during the 90-day 60-day period from when notice is provided to the worker, from discharging a worker affected by a technological displacement without reasonable and substantiated cause.

This bill would make an employer that fails to give notice before ordering a technological displacement liable for back pay and benefits to each worker for a maximum of 60 days or one-half the number of days the worker was employed, whichever period is shorter. The bill would also impose a $500 civil penalty for each day of the employers violation, except as provided.

This bill would set forth procedures for reporting violations to the commissioner and filing a civil action in court. The bill would provide enforcement authority and related powers to the commissioner. The bill would establish the Technological Displacement Act Fund, require all civil penalties recovered by the commissioner to be deposited in the fund, and make all moneys in the fund available to the commissioner upon appropriation. The bill would make its provisions severable.

Existing law establishes the Labor and Workforce Development Agency, which is composed of various departments responsible for protecting and promoting the rights and interests of workers in California, including the Division of Labor Standards Enforcement, led by the Labor Commissioner (commissioner), within the Department of Industrial Relations. Existing law establishes the Employment Development Department (EDD), which is administered by the Director of Employment Development. Under existing law, the Director of Employment Development is vested with specified duties, purposes, responsibilities, and jurisdiction related to job creation activity functions, among other things.

This bill would establish the California Worker Technological Displacement Act, which would require an employer, as defined, to provide at least a 90-day advanced written notice, as described, before any technological displacement affecting 25 or more workers or 25 percent of the workforce, whichever is less. The bill would require an employer to provide that notice to affected workers, the EDD, and specified state and local entities. The bill would also require an employer to provide a written technology hiring disruption notice to the EDD and specified local entities the local workforce investment board when it executes a technological cessation in hiring directly and primarily due to the adoption of artificial intelligence or other automating technology. The bill would impose various reporting requirements on the EDD.

For employers with more than 100 workers, this bill would entitle workers affected by technological displacement to a right of first bid on other positions with the employer. The bill would prohibit an employer, during the 90-day period from when notice is provided to the worker, from discharging a worker affected by a technological displacement without reasonable and substantiated cause.

This bill would make an employer that fails to give notice before ordering a technological displacement liable for back pay and benefits to each worker for a maximum of 60 days or one-half the number of days the worker was employed, whichever period is shorter. The bill would also impose a $500 civil penalty for each day of the employers violation, except as provided.

This bill would set forth procedures for reporting violations to the commissioner and filing a civil action in court. The bill would provide enforcement authority and related powers to the commissioner. The bill would establish the Technological Displacement Act Fund, require all civil penalties recovered by the commissioner to be deposited in the fund, and make all moneys in the fund available to the commissioner upon appropriation. The bill would make its provisions severable.

Existing law establishes the Labor and Workforce Development Agency, which is composed of various departments responsible for protecting and promoting the rights and interests of workers in California, including the Division of Labor Standards Enforcement, led by the Labor Commissioner (commissioner), within the Department of Industrial Relations. Existing law establishes the Employment Development Department (EDD), which is administered by the Director of Employment Development. Under existing law, the Director of Employment Development is vested with specified duties, purposes, responsibilities, and jurisdiction related to job creation activity functions, among other things.

This bill would establish the California Worker Technological Displacement Act, which would require an employer, as defined, to provide at least a 90-day advanced written notice, as described, before any technological displacement affecting 25 or more workers or 25 percent of the workforce, whichever is less. The bill would require an employer to provide that notice to affected workers, the EDD, and specified state and local entities. The bill would also require an employer to provide a written technology hiring disruption notice to the EDD and specified local entities when it executes a technological cessation in hiring directly and primarily due to the adoption of artificial intelligence or other automating technology. The bill would impose various reporting requirements on the EDD.

For employers with more than 100 workers, this bill would entitle workers affected by technological displacement or termination of contract to a right of first bid on other positions with the employer and would prohibit discharge of those workers during a 90-day period from when notice is provided. employer. The bill would prohibit an employer, during the 90-day period from when notice is provided to the worker, from discharging a worker affected by a technological displacement without reasonable and substantiated cause.

This bill would make an employer that fails to give notice before ordering a technological displacement liable for back pay and benefits to each worker for a maximum of 60 days or one-half the number of days the worker was employed, whichever period is shorter. The bill would also impose a $500 civil penalty for each day of the employers violation, except as provided.

This bill would set forth procedures for reporting violations to the commissioner and filing a civil action in court. The bill would provide enforcement authority and related powers to the commissioner. The bill would establish the Technological Displacement Act Fund, require all civil penalties recovered by the commissioner to be deposited in the fund, and make all moneys in the fund available to the commissioner upon appropriation. The bill would make its provisions severable.

Existing law establishes the Labor and Workforce Development Agency, which is composed of various departments responsible for protecting and promoting the rights and interests of workers in California, including the Division of Labor Standards Enforcement, led by the Labor Commissioner (commissioner), within the Department of Industrial Relations. Existing law establishes the Employment Development Department (EDD), which is administered by the Director of Employment Development. Under existing law, the Director of Employment Development is vested with specified duties, purposes, responsibilities, and jurisdiction related to job creation activity functions, among other things.

This bill would establish the California Worker Technological Displacement Act, which would require a covered an employer, as defined, to provide at least a 90-day advanced written notice, as described, before any technological displacement or termination of contract affecting 25 or more workers or 25 percent of the workforce, whichever is less. The bill would require a covered an employer to provide that notice to affected employees, workers, the EDD, and specified state and local entities. The bill would also require a covered an employer to provide a written technology hiring disruption notice to be provided to the EDD and specified local entities when it executes a technological reduction in hiring or cessation in hiring directly and primarily due to the adoption of artificial intelligence or other automating technology. The bill would impose various reporting requirements on the EDD.

For covered employers with more than 100 workers, this bill would entitle workers affected by technological displacement or termination of contract to a right of first bid on other positions with the employer and would prohibit discharge of those workers during a 90-day period from when notice is provided.

This bill would require a covered make an employer that fails to provide notice to provide give notice before ordering a technological displacement liable for back pay and benefits to each affected employee, as described, worker for a maximum of 60 days or one-half the number of days the employee worker was employed, whichever period is shorter. The bill would also impose a $500 civil penalty for each day of the covered employers violation, except as provided.

This bill would set forth procedures for reporting violations to the commissioner and filing a civil action in court. The bill would provide enforcement authority and related powers to the commissioner. The bill would establish the Technological Displacement Act Fund, require all civil penalties recovered by the commissioner to be deposited in the fund, and make all moneys in the fund available to the commissioner upon appropriation. The bill would make its provisions severable.

Existing law establishes the Labor and Workforce Development Agency, which is composed of various departments responsible for protecting and promoting the rights and interests of workers in California, including the Division of Labor Standards Enforcement, led by the Labor Commissioner (commissioner), within the Department of Industrial Relations. Existing law establishes the Employment Development Department (EDD), which is administered by the Director of Employment Development. Under existing law, the Director of Employment Development is vested with specified duties, purposes, responsibilities, and jurisdiction related to job creation activity functions, among other things.

This bill would establish the California Worker Technological Displacement Act, which would require a covered employer, as defined, to provide at least a 90-day advanced written notice, as described, before any technological displacement or termination of contract affecting 25 or more workers or 25 percent of the workforce, whichever is less. The bill would require a covered employer to provide that notice to affected employees, the EDD, and specified state and local entities. The bill would also require a covered employer to provide a written technology hiring disruption notice to be provided to the EDD and specified local entities when it executes a technological reduction in hiring or cessation in hiring due to the adoption of artificial intelligence or other automating technology. The bill would impose various reporting requirements on the EDD.

For covered employers with more than 100 workers, this bill would entitle workers affected by technological displacement or termination of contract to a right of first bid on other positions with the employer and would prohibit discharge of those workers during a 90-day period from when notice is provided.

This bill would require a covered employer that fails to provide notice to provide back pay and benefits to each affected employee, as described, for a maximum of 60 days or one-half the number of days the employee was employed, whichever period is shorter. The bill would also impose a $500 civil penalty for each day of the covered employers violation, except as provided.

This bill would set forth procedures for reporting violations to the commissioner and filing a civil action in court. The bill would provide enforcement authority and related powers to the commissioner. The bill would establish the Technological Displacement Act Fund, require all civil penalties recovered by the commissioner to be deposited in the fund, and make all moneys in the fund available to the commissioner upon appropriation. The bill would make its provisions severable.

 UNFINISHED BUSINESS  

Bill No: SB 951

Author: Reyes (D), et al.

Amended: 8/21/26

Vote: 21

SENATE LABOR, PUB. EMP. & RET. COMMITTEE: 3-1, 4/8/26

AYES: Smallwood-Cuevas, Cortese, Durazo

NOES: Strickland

NO VOTE RECORDED: Laird

SENATE PRIV., DIGITAL TECH. & CONS. PROT. COMMITTEE: 7-2, 4/20/26

AYES: Cabaldon, Gonzalez, McNerney, Padilla, Reyes, Umberg, Wiener

NOES: Jones, Seyarto

SENATE APPROPRIATIONS COMMITTEE: 5-2, 5/14/26

AYES: Cervantes, Cabaldon, Grayson, Richardson, Wahab

NOES: Seyarto, Dahle

SENATE FLOOR: 28-9, 5/20/26

AYES: Allen, Archuleta, Arreguín, Ashby, Blakespear, Cabaldon, Caballero, Cervantes, Cortese, Durazo, Gonzalez, Grayson, Laird, Limón, McGuire, McNerney, Menjivar, Padilla, Pérez, Reyes, Richardson, Rubio, Smallwood-Cuevas, Stern, Umberg, Wahab, Weber Pierson, Wiener

NOES: Alvarado-Gil, Choi, Dahle, Jones, Niello, Ochoa Bogh, Seyarto, Strickland, Valladares

NO VOTE RECORDED: Becker, Grove, Hurtado

ASSEMBLY FLOOR: Passed, 8/31/26

SUBJECT: Employment: technological displacement: notice

SOURCE: California Federation of Labor Unions

DIGEST:

This bill 1) amends the California Workers Adjustment and Retraining Act (Cal/WARN) to require employers to provide written notice with specified information to employees and certain government entities, as specified, if the mass layoff, relocation, or termination is caused in whole or in substantial part by an artificial intelligence (AI) system or other automated technology replacing or automating employment positions; 2) requires the Employment Development Department (EDD) to publish a summary of notices received, as specified; and 3) requires EDD to submit to the Legislature a report on artificial intelligence’s effects on business hiring practices, including its impact on industries and occupations as the state and regional level, as specified.

Assembly Amendments

recast the technological displacement notice requirements of this bill, as it passed to the Assembly, into the Cal/WARN provisions of existing law to address potential redundancy and confusion; struck the provisions requiring employers to provide a hiring disruption notice to EDD; removed provisions that would have entitled certain employees affected by a technological displacement with a right of first bid on other positions with the employer; clarified that the notices must be provided when there are displacements or cessations “caused in whole or in substantial part” by AI or automation; struck the enforcement provisions, that included specified penalties and civil actions, to instead apply the existing enforcement provisions under Cal/WARN; and made other technical and clarifying amendments.

ANALYSIS:

Existing federal law:

1. Establishes the federal Worker Adjustment and Retraining Notification (WARN) Act prohibiting an employer with 100 or more full-time employees, as specified, from ordering a plant closure or mass layoff until the end of a 60-day period after the employer serves written notice of such an order to:
   1. Each representative of the affected employees as of the time of the notice or, if there is no such representative at that time, to each affected employee; and
   2. The State or entity designated by the State to carry out rapid response activities, as specified, and the chief elected official of the unit of local government within which such closing or layoff is to occur. (29 United States Code (U.S.C.) §§2101)
2. Makes an employer who violates the federal WARN provisions liable to each employee for an amount equal to back pay and benefits for the period of the violation, up to 60 days, but no more than half the number of days the employee was employed by the employer. (29 U.S.C. §§2104)

Existing state law:

1. Establishes the California Worker Adjustment and Retraining Act (Cal/WARN), which prohibits an employer with 75 or more full and part-time employees from ordering a mass layoff (of 50 or more employees within a 30-day period), relocation, or termination at a covered establishment, as defined, unless, 60 days before the order takes effect, the employer gives written notice to all of the following:
   1. The employees of the covered establishment affected by the order.
   2. The Employment Development Department (EDD), the local workforce investment board, and the chief elected official of each city and county government within which the termination, relocation, or mass layoff occurs. (Labor Code §1400-1413)
2. Exempts, from the provisions of Cal/WARN, seasonal employees and employees that are laid off as a result of the completion of a project in specified industries, where the employers are subject to specified wage orders, and the employees were hired with the understanding that their employment was seasonal and temporary. (Labor Code §1400.5.)
3. Requires employers mandated to give notice of any mass layoff, relocation, or termination pursuant to Cal/WARN to include in its notice, the elements required by the federal WARN Act. (Labor Code §1401)
4. Makes an employer that fails to give the required Cal/WARN notice before ordering a mass layoff, relocation, or termination liable to each employee entitled to notice, for specified back pay and medical expenses incurred that would have been covered under an employee benefit plan, calculated for the period of the employer’s violation, up to a maximum of 60 days, or half the number of days that the employee was employed by the employer, whichever period is shorter. (Labor Code §1402)
5. Subjects an employer who fails to give the required Cal/WARN notice to a civil penalty of not more than five hundred dollars ($500) for each day of the employer’s violation. Exempts an employer from this civil penalty if the employer pays all applicable employees within three weeks from the date the employer ordered the mass layoff, relocation, or termination. (Labor Code §1403)
6. Permits a person, including a local government, or an employee representative, seeking to establish liability against an employer for violation of Cal/WARN to bring a civil action on behalf of the person other persons similarly situated, or both, in any court of competent jurisdiction. Additionally, permits a court to award reasonable attorney’s fees as part of the costs to any plaintiff who prevails in a civil action. (Labor Code §1404)
7. Defines “artificial intelligence” (AI) to mean an engineered or machine-based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments. (Government Code §11546.45.5)
8. Establishes within the Department of Industrial Relations (DIR), various entities including the Division of Labor Standards Enforcement (DLSE) under the direction of the Labor Commissioner (LC), and empowers the LC with ensuring a just day’s pay in every workplace and promotes economic justice through robust enforcement of labor laws. (Labor Code §79-107)
9. Establishes the Employment Development Department (EDD) and vests it with various duties and responsibilities including job creation activities, administration of the Unemployment, Disability, and Paid Family Leave programs, collection of payroll taxes, keeping track of employment records, managing federal job training programs, and collecting and sharing information about the job market. (Unemployment Insurance Code §301)

This bill:

1. Adds the existing definition for “artificial intelligence” or “AI” to the Cal/WARN provisions.
2. Specifies that employers required to give notice of a mass layoff, relocation, or termination caused in whole or in substantial part by an AI system or other automated technology replacing or automating employment positions, shall additionally include in the Cal/WARN notice all of the following:
   1. The number, classification or occupation, and work location of layoffs that are substantially due to the replacement or automation by AI or other automated technology.
   2. The job functions performed by those replaced workers that will be automated by AI or other automated technology.
   3. The specific category or type of AI system or other automating technology that substantially resulted in technological displacement.
   4. Requires the notice to include the statement “This notice is for a technology displacement” at the top of the notice.
3. Requires EDD, as part of its regular data reporting of the Cal-WARN Act, to publish a summary of the AI-related notices received on its internet website and post a quarterly statewide summary of technology displacements reported.
4. Requires EDD, on or before January 1, 2028, to create a report on AI's effects on business hiring practices, including its impact on industries and occupations at the state and regional level. This report shall be submitted to the Legislature and shall include one or more of the following:
5. Recommendations regarding a public notice requirement for employers or businesses engaged in technological cessation in hiring, including, but not limited to the following:
6. Timing of when such a notice must be provided.
7. The role of the EDD to compile, make public, or otherwise analyze these notices.
8. Details to be included in the notice, such as data on the number of workers or contractors, or the types of occupations, potentially affected by a technological cessation in hiring.
9. Considerations on how best to ensure accurate information on emerging hiring trends through a notice requirement.
10. A summary of the trends in hiring demand across industries or occupations, based on their level of exposure to AI.
11. A summary of how businesses use AI and its effects on hiring practices, including technological cessation in hiring.
12. A summary of existing research regarding the effects of AI on businesses' hiring needs and practices.
13. Repeals the provisions regarding the EDD report on AI’s effects on business hiring practices on January 1, 2029.

Background

According to a recent CNBC article, “recent estimates from Goldman Sachs suggest that 6% to 7% of U.S. workers could lose their jobs because of AI adoption. The Stanford Digital Economy Lab, using ADP employment data, found that entry-level hiring in “AI exposed jobs” has dropped 13% since large language models started proliferating. The report said software development, customer service and clerical work are the types of jobs most vulnerable to AI today.”^[1]

Advance notification before a termination or layoff provides employees with necessary time to transition and adjust to the potential loss of employment, time to seek alternative employment and, if necessary, time to obtain skills training or retraining to successfully compete in the job market. Given the unprecedented way in which AI is transforming our economy, providing workers with advance notification before an AI displacement could grant workers this much needed time to adjust and transition to another job.

Need for this bill? According to the author: “Artificial intelligence is transforming our economy at an unprecedented pace…Employers are already citing AI as a reason for layoffs and hiring freezes, yet policymakers lack reliable data to understand the full impact. Without this information, government is forced to respond only after workers have already lost their livelihoods. This bill requires employers to provide written notice to workers and the California Department of Employment Development (EDD) before conducting mass layoffs driven by the development of AI. It builds on the existing California Worker Adjustment and Retraining Notification (WARN) Act by adding notification of layoffs caused by technology. It also provides the state with data on the impact of artificial intelligence on layoffs, reductions in hiring caused, or other technological disruptions to help prevent economic dislocation and harm to workers and communities.”

[NOTE: Please see the Senate Labor, Public Employment and Retirement Committee analysis on this bill for more background information and information on prior and related legislation.]

FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: No

According to the Assembly Appropriations Committee:

1. Costs of an unknown, but likely significant amount, in excess of $150,000, across state entities as employers to provide the technological cessation notice when applicable (General Fund (GF) or special fund). The magnitude of costs depends on the scope of work of the entity and the prevalence and use of AI systems in the workplace. For example, the California Community Colleges anticipates minor ongoing costs to the Chancellor’s Office and districts to provide the notice if and when there is a technological cessation in hiring. However, the University of California (UC) anticipates significant new administrative and compliance costs of a difficult-to-estimate amount to establish systemwide review and tracking infrastructure to evaluate AI-related workforce actions and provide the notice under applicable circumstances. The UC also notes costs related to legal review and training, as well as substantial indirect costs from delays or constraints in technology adoption and increased labor-relations activity.

Similarly, likely significant costs to local government employers, which the state would not need to reimburse because this bill’s new requirements for local agencies equally apply to the private sector.

1. Costs of approximately $10,000 one-time and $100,000 ongoing to EDD to establish procedures to receive the additional Cal/WARN notice and technological cessation notice, post summaries of the technological cessation notice online, and submit quarterly reports to the Legislature (GF).
2. Costs of approximately $1.5 million in the first year and $1.4 million annually thereafter to the Division of Labor Standards Enforcement (DLSE, also known as the LC), with greater workload attributed to enforcing the technological cessation notice requirement than the additional Cal/WARN notice requirement. DLSE anticipates needing to contract with AI experts to perform what would likely be lengthy investigations to determine whether an employer executed a technological cessation in hiring without filing a notice.
3. Ongoing cost pressures of an unknown amount to the courts in additional workload by creating the additional Cal/WARN notice requirement, as existing law allows an employee or employee representative to bring a civil action to establish liability for backpay and benefits against an employer that does not provide proper Cal/WARN notice to a covered establishment’s employees 60 days before the order takes effect (GF or Trial Court Trust Fund (TCTF)). It is unclear how many civil actions may be filed statewide and how much court time may be needed to resolve each case, but it generally costs approximately $1,000 to operate a courtroom for one hour. Although courts are not funded on the basis of workload, increased pressure on staff and the TCTF may create a demand for increased court funding from the GF. The state budget provides annual GF backfills to the TCTF to offset revenue reductions, totaling approximately $117.3 million in fiscal year 2025-26.

SUPPORT: (Verified 8/26/26)

California Federation of Labor Unions (Source)

Alameda Labor Council

American Federation of Musicians, Local 7

American Federation of State, County and Municipal Employees, California

California Alliance for Retired Americans

California Employment Lawyers Association

California Faculty Association

California Federation of Teachers

California Nurses Association

California Rural Legal Assistance Foundation

California School Employees Association

California State Legislative Board of the SMART - Transportation Division

California Teachers Association

Center on Policy Initiatives

Central Coast Labor Council

Communications Workers of America, District 9

County Employees Management Association

Electronic Frontier Foundation

Fresno-Madera-Tulare-Kings Central Labor Council

Inland Empire Labor Council

Kapor Center Advocacy

North Bay Labor Council

North Valley Labor Council

Orange County Labor Federation

San Mateo County Central Labor Council

Service Employees International Union, California State Council

State Building and Construction Trades Council of California

TechEquity Action

What We Will

OPPOSITION: (Verified 8/26/26)

Acclamation Insurance Management Services

Allied Managed Care

Associated General Contractors - California

Associated General Contractors - San Diego

Association of California Community College Administrators

Calforests

California Apartment Association

California Association of School Business Officials

California Bankers Association

California Chamber of Commerce

California Distributors Association

California Employment Law Council

California Farm Bureau

California Food Producers

California Fuels and Convenience Alliance

California Grocers Association

California Hospital Association

California Landscape Contractors Association

California League of Food Producers

California Manufacturers and Technology Association

California Restaurant Association

California Retailers Association

California's Credit Unions

Chamber of Progress

Civil Justice Association of California

County of Ventura

Flasher Barricade Association

Los Angeles Area Chamber of Commerce

Nevada County Board of Supervisors

Official Police Garages of Los Angeles

Orange County Business Council

SHRM California

Silicon Valley Leadership Group

Small School Districts Association

Southwest California Legislative Council

TechNet

Tri-County Chamber Alliance

Valley Industry and Commerce Association

Western Growers Association

ARGUMENTS IN SUPPORT: The sponsors of the measure, the California Federation of Labor Unions, write: “Policy makers cannot ignore the blaring alarm bells warning of massive economic upheaval and worker suffering. AI poses an existential threat to human workers, government revenue, and society. The first step to tackling the growing threat is to collect and use reliable, local data to inform policy responses and to support workers who are the canaries in the coal mine of AI. This bill is a small, but crucial first step to that process.

SB 951 provides policy makers and the public with data on AI-related job loss.”

ARGUMENTS IN OPPOSITION: A coalition of employer organizations, including the California Chamber of Commerce, are opposed arguing, among other things, “while we appreciate amendments the author has taken to more closely align with California’s current WARN Act (Cal-WARN), the bill's core structural problems remain unresolved…Further, data suggests that expanding statutory triggers tied to workforce changes can significantly increase litigation exposure under other laws. According to a recent study, The Impact of PAGA on Business Viability and Employment Security-Comparing the Relationship Between PAGA Settlements and WARN Notice Issuance, California businesses paid approximately $823,710,861 in settlements in FY 2022–2023 in matters where WARN notices and PAGA claims overlapped. The study identified a strong correlation between WARN related workforce actions and representative litigation exposure. By layering new notice requirements and liability standards on top of existing WARN obligations, SB 951 is likely to substantially increase settlement pressure and litigation costs for employers, including small businesses, that lack the resources to absorb prolonged legal disputes.”

Prepared by: Alma Perez-Schwab / L., P.E. & R. / (916) 651-1556

8/31/26 12:26:56

**** END ****

1. Samantha Subin, “AI is already taking white-collar jobs. Economists warn there’s ‘much more in the tank,’” October 23, 2025, CNBC. https://www.cnbc.com/2025/10/22/ai-taking-white-collar-jobs-economists-warn-much-more-in-the-tank.html ↑

SENATE THIRD READING

STR Bill Id:SB 951

Author:(Reyes)

As Amended Ver:August 21, 2026

Majority vote

SUMMARY

Amends the California Worker Adjustment and Retraining Act (Cal/WARN) to require an employer to provide written notice with additional information to workers and entities, as specified, if the mass layoff, relocation, or termination is caused in whole or in substantial part by an AI system or other automated technology replacing or automating employment positions. Additionally requires the Employment Development Department (EDD) on or before January 1, 2028, to create a report on AI's effects on business hiring practices, including its impact on industries and occupations at the state and regional level.

Major Provisions

Cal/WARN Act AI-related notice provisions

1. Adds a definition of AI, as specified.
2. States that an employer who is required to give notice of a mass layoff, relocation, or termination, if the mass layoff, relocation, or termination is caused in whole or in substantial part by an AI system or other automated technology replacing or automating employment positions, shall additionally include in the notice all of the following:
   1. The number, classification or occupation, and work location of layoffs that are substantially due to the replacement or automation by AI or other automated technology.
   2. The job functions performed by those replaced workers that will be automated by AI or other automated technology.
   3. The specific category or type of AI system or other automating technology that substantially resulted in technological displacement, including the entity or entities that developed, sold, or leased the product.
   4. The notice shall include "This notice is for a technology displacement" at the top of the notice.
3. Requires the EDD, as part of its data reporting of the Cal/WARN Act, to publish a summary of the AI-related notices on its internet website and post a quarterly summary of technological displacements reported in the notices.

EDD report on AI's effects on business hiring practices

1. Defines "technological cessation in hiring" to mean the permanent ending of hiring or contracting for a particular occupation or position, caused in whole or in part by the employer's use of AI or other automated technology, regardless of either of the following:
2. Whether any workers in that occupation or position remain employed or under contract.
3. Whether the cessation results in an overall reduction in occupations or positions.
4. Requires the EDD, on or before January 1, 2028, to create a report on AI's effects on business hiring practices, including its impact on industries and occupations at the state and regional level. This report shall be submitted to the Legislature and shall include one or more of the following:
5. Recommendations regarding a public notice requirement for employers or businesses engaged in technological cessation in hiring, including, but not limited to the following:
6. Timing of when such a notice must be provided.
7. The role of the EDD to compile, make public, or otherwise analyze these notices.
8. Details to be included in the notice, as specified.
9. Considerations on how best to ensure accurate information on emerging hiring trends through a notice requirement.
10. A summary of the trends in hiring demand across industries or occupations, based on their level of exposure to AI.
11. A summary of how businesses use AI and its effects on hiring practices, including technological cessation in hiring.
12. A summary of existing research regarding the effects of AI on businesses' hiring needs and practices.
13. Repeals the provisions regarding the EDD report on AI’s effects on business hiring practices on January 1, 2029.

COMMENTS

See the Committee’s Policy Analysis.

According to the Author

According to the author, "Artificial Intelligence is transforming our economy at an unprecedented pace. Unlike past technological advances, AI has the ability to automate entire occupations almost overnight, leaving workers vulnerable to sudden economic disruption. Employers are already citing AI as a reason for layoffs and hiring freezes, yet policymakers lack reliable data to understand the full impact. Without this information, government is forced to respond only after workers have already lost their livelihoods.

SB 951 modernizes California's existing Worker Adjustment and Retraining Notification Act by requiring employers to provide a 60-day advance notice when mass layoffs are driven by artificial intelligence or technological automation. This ensures workers and the state have time to prepare and respond, while also allowing the state to collect critical data on AI-related job loss and workforce disruption. This information will help policymakers better understand how AI is reshaping our labor market and craft informed, proactive solutions."

Arguments in Support

The California Federation of Labor Unions, AFL-CIO, sponsor of the bill, states, "What makes AI different than other technologies or economic fluctuations is the scope, scale, and velocity at which it is sweeping the economy. Instead of automated assembly lines limited to factories, employers are using AI tools to automate tasks across broad swaths of the workforce in many industries all at once. Agentic AI can ostensibly plan, reason, and execute complex, multi-step tasks with minimal human intervention, poised to eliminate many human positions. Even if the abilities of AI tools are overstated or exaggerated, employers are adopting the technology anyway. When AI cannot do the work, the remaining workers must work harder and longer, intensifying the jobs that are left.

Policy makers cannot ignore the blaring alarm bells warning of massive economic upheaval and worker suffering. AI poses an existential threat to human workers, government revenue, and society. The first step to tackling the growing threat is to collect and use reliable, local data to inform policy responses and to support workers who are the canaries in the coal mine of AI. This bill is a small, but crucial first step to that process."

Arguments in Opposition

A coalition of employer organizations, including the California Chamber of Commerce, are opposed and state, "SB 951 requires employers to disclose the "specific category or type" of AI system or other automating technology that caused the layoff. However, the bill does not define how AI tools are "categorized" or broken down by "type." Each AI tool is not the same and does not operate on a single, universally accepted classification system. An employer who discloses a broad category risks an enforcement action for insufficient specificity, while an employer who discloses a specific vendor product name risks breaching a confidentiality agreement with that vendor for having done so publicly.

Consider an employer that uses an AI-powered platform to automate document drafting and administrative functions previously performed by support staff. Is the required disclosure the commercial product name? The broader technology category, such as generative AI? or the functional business description, such as productivity automation software? All three descriptions are accurate, all three describe the same tool, yet SB 951 provides no guidance on which satisfies the obligation. Multiply this ambiguity across the many AI-adjacent tools a modern employer may use including payroll platforms, scheduling software, applicant tracking systems, and the compliance burden becomes unmanageable. Further, two employers may likely categorize the same tool differently, rendering the data EDD collects neither standardized nor useful for the workforce policy purposes the bill is intended to serve."

FISCAL COMMENTS

According to the Assembly Appropriations Committee,

1. Costs of an unknown, but likely significant amount, in excess of $150,000, across state entities as employers to provide the technological cessation notice when applicable (General Fund (GF) or special fund). The magnitude of costs depends on the scope of work of the entity and the prevalence and use of AI systems in the workplace. For example, the California Community Colleges anticipates minor ongoing costs to the Chancellor’s Office and districts to provide the notice if and when there is a technological cessation in hiring. However, the University of California (UC) anticipates significant new administrative and compliance costs of a difficult-to-estimate amount to establish systemwide review and tracking infrastructure to evaluate AI-related workforce actions and provide the notice under applicable circumstances. The UC also notes costs related to legal review and training, as well as substantial indirect costs from delays or constraints in technology adoption and increased labor-relations activity.

Similarly, likely significant costs to local government employers, which the state would not need to reimburse because this bill's new requirements for local agencies equally apply to the private sector.

1. Costs of approximately $10,000 one-time and $100,000 ongoing to EDD to establish procedures to receive the additional Cal/WARN notice and technological cessation notice, post summaries of the technological cessation notice online, and submit quarterly reports to the Legislature (GF).
2. Costs of approximately $1.5 million in the first year and $1.4 million annually thereafter to the Division of Labor Standards Enforcement (DLSE, also known as the LC), with greater workload attributed to enforcing the technological cessation notice requirement than the additional Cal/WARN notice requirement. DLSE anticipates needing to contract with AI experts to perform what would likely be lengthy investigations to determine whether an employer executed a technological cessation in hiring without filing a notice.
3. Ongoing cost pressures of an unknown amount to the courts in additional workload by creating the additional Cal/WARN notice requirement, as existing law allows an employee or employee representative to bring a civil action to establish liability for backpay and benefits against an employer that does not provide proper Cal/WARN notice to a covered establishment’s employees 60 days before the order takes effect (GF or Trial Court Trust Fund (TCTF)). It is unclear how many civil actions may be filed statewide and how much court time may be needed to resolve each case, but it generally costs approximately $1,000 to operate a courtroom for one hour. Although courts are not funded on the basis of workload, increased pressure on staff and the TCTF may create a demand for increased court funding from the GF. The state budget provides annual GF backfills to the TCTF to offset revenue reductions, totaling approximately $117.3 million in fiscal year 2025-26.

VOTES

SENATE FLOOR: 28-9-3

YES: Allen, Archuleta, Arreguín, Ashby, Blakespear, Cabaldon, Caballero, Cervantes, Cortese, Durazo, Gonzalez, Grayson, Laird, Limón, McGuire, McNerney, Menjivar, Padilla, Pérez, Reyes, Richardson, Rubio, Smallwood-Cuevas, Stern, Umberg, Wahab, Weber Pierson, Wiener

NO: Alvarado-Gil, Choi, Dahle, Jones, Niello, Ochoa Bogh, Seyarto, Strickland, Valladares

ABS, ABST OR NV: Becker, Grove, Hurtado

ASM LABOR AND EMPLOYMENT: 5-0-2

YES: Ortega, Arambula, Kalra, Lee, Ward

ABS, ABST OR NV: Alanis, Chen

ASM PRIVACY AND CONSUMER PROTECTION: 11-2-2

YES: Bauer-Kahan, Bryan, Irwin, Lowenthal, McKinnor, Ortega, Pellerin, Petrie-Norris, Ward, Bennett, Wilson

NO: Macedo, DeMaio

ABS, ABST OR NV: Hoover, Patterson

ASM APPROPRIATIONS: 10-3-2

YES: Wicks, Arambula, Calderon, Caloza, Fong, Mark González, Krell, Pellerin, Sharp-Collins, Solache

NO: Dixon, Ta, Tangipa

ABS, ABST OR NV: Hoover, Pacheco

UPDATED

VERSION: August 21, 2026

CONSULTANT: Megan Lane / L. & E. / (916) 319-2091 FN: 0003993

SENATE THIRD READING

STR Bill Id:SB 951

Author:(Reyes)

As Amended Ver:August 13, 2026

Majority vote

SUMMARY

Amends the California Worker Adjustment and Retraining Act (Cal/WARN) to require an employer to provide written notice with additional information to workers and entities, as specified, if the mass layoff, relocation, or termination is caused in whole or in substantial part by an AI system or other automated technology replacing or automating employment positions. Additionally requires an employer to provide to the Employment Development Department (EDD) a written technology hiring disruption notice when it executes a technological cessation in hiring. Authorizes enforcement of the technological hiring disruption notice provisions by the Labor Commissioner (LC).

Major Provisions

Revisions to the Cal/WARN Act

1. Adds a definition of "artificial intelligence" or "AI," as specified.
2. States that an employer who is required to give notice of a mass layoff, relocation, or termination, if the mass layoff, relocation, or termination is caused in whole or in substantial part by an AI system or other automated technology replacing or automating employment positions, shall additionally include in the notice all of the following:
   1. The number, classification or occupation, and work location of layoffs that are substantially due to the replacement or automation by AI.
   2. The job functions performed by those replaced workers that will be automated by AI.
   3. The specific category or type of AI system or other automating technology that substantially resulted in technological displacement, including the entity or entities that developed, sold, or leased the product.

Technological cessation in hiring notice provisions

1. Defines "employer" to mean any person, association, organization, partnership, business trust, limited liability company, or corporation who directly or indirectly owns and operates an establishment that employs, or has employed within the preceding 12 months, 75 or more persons. A parent corporation is an employer as to any establishment directly owned and operated by its corporate subsidiary. An "employer" includes, but is not limited to, any of the following:
   1. The state, including its legislative, judicial, and executive branches.
   2. Any city, county, or city and county, including any charter city, charter county, charter city and county, and other political subdivisions of the state.
   3. Special districts.
   4. Local educational agencies and community college districts.
   5. Any authority, commission, board, agency, or instrumentality of any entity specified in

paragraphs (a)-(c), above.

• 1. The University of California and the California State University.
  2. Any business or state or local government that contracts with or compensates contractors.

1. Defines "contractor" to mean an entity contracted with, or being compensated by, a business or a state or local governmental entity for at least 6 months of the 12 months preceding the date on which the notice is required.
2. Defines "technological cessation in hiring" to mean the permanent ending of hiring or contracting workers or contractors for a particular occupation or position, caused in whole or in substantial part by the employer's use of AI or other automation, regardless of either of the following:
   1. Whether any workers or contractors in that occupation or position remain employed or under contract.
   2. Whether the cessation results in an overall reduction in occupations or positions.
3. Defines "worker" to mean any natural person who is an employee of a business or a state or a local governmental entity in any workplace, for at least 6 months of the 12 months preceding the date on which notice is required, and as specified.
4. Requires an employer to provide a written technology hiring disruption notice when it executes a technological cessation in hiring to the EDD.
5. Requires the notice to contain all of the following information:
   1. The name and address of the employment site and the name, email, and telephone number of a company official or public agency contact person.
   2. A statement indicating whether the planned action is permanent or temporary.
   3. The number of positions of the employer that were occupied at any point during the prior quarter for which the employer has decided not to fill because of a technological cessation in hiring.
   4. The classification or occupation, and work location of positions that will no longer be filled by workers or contractors due to the replacement or automation by AI.
   5. The job functions performed in these positions.
   6. The specific category or type of AI system or other automating technology that resulted in the technological cessation of hiring, including the entity or entities that developed, sold, or leased the product.
   7. A statement whether the cessation resulted in hiring or creation of other employment positions in the company and the number and occupation of those positions.
6. Requires the EDD to do the following:
   1. Post summaries of the notices received pursuant to 7), above, on their internet website as part of the existing notice requirements of the Cal/WARN Act.
   2. Compile a quarterly summary using notices received to present a statewide summary of worker displacement due to AI and automation. The report shall include a link to the Cal/WARN Act notice report internet website.
   3. Submit the report to the labor and budget committees of the Assembly and Senate, as specified.

Enforcement provisions

1. States that an employer that fails to provide notice as required by 7), above, shall be subject to a civil penalty of not more than five hundred dollars ($500) for each day of the employer’s violation.
2. Authorizes the LC to enforce the notice requirements in 7)-8), above, through the procedures set forth in Labor Code Section 98.3 or 1197.1, as specified.

COMMENTS

See the Committee's Policy Analysis.

According to the Author

According to the author, “Artificial Intelligence is transforming our economy at an unprecedented pace. Unlike past technological advances, AI has the ability to automate entire occupations almost overnight, leaving workers vulnerable to sudden economic disruption. Employers are already citing AI as a reason for layoffs and hiring freezes, yet policymakers lack reliable data to understand the full impact. Without this information, government is forced to respond only after workers have already lost their livelihoods.

This bill modernizes California’s existing Worker Adjustment and Retraining Notification Act by requiring employers to provide a 60-day advance notice when mass layoffs are driven by artificial intelligence or technological automation. This ensures workers and the state have time to prepare and respond, while also allowing the state to collect critical data on AI-related job loss and workforce disruption. This information will help policymakers better understand how AI is reshaping our labor market and craft informed, proactive solutions.”

Arguments in Support

The California Federation of Labor Unions, AFL-CIO, sponsor of the bill, states, “What makes AI different than other technologies or economic fluctuations is the scope, scale, and velocity at which it is sweeping the economy. Instead of automated assembly lines limited to factories, employers are using AI tools to automate tasks across broad swaths of the workforce in many industries all at once. Agentic AI can ostensibly plan, reason, and execute complex, multi-step tasks with minimal human intervention, poised to eliminate many human positions. Even if the abilities of AI tools are overstated or exaggerated, employers are adopting the technology anyway. When AI cannot do the work, the remaining workers must work harder and longer, intensifying the jobs that are left.

Policy makers cannot ignore the blaring alarm bells warning of massive economic upheaval and worker suffering. AI poses an existential threat to human workers, government revenue, and society. The first step to tackling the growing threat is to collect and use reliable, local data to inform policy responses and to support workers who are the canaries in the coal mine of AI. This bill is a small, but crucial first step to that process.”

Arguments in Opposition

A coalition of employer organizations, including the California Chamber of Commerce, are opposed and state, “The Employment Development Department (EDD) in partnership with the California Policy Lab (CPL) launched the nation's first California AI-Unemployment Tracker (CAIT) on July 23, 2026.1 The CPL is a University of California research institute that generates research insights for government impact. CAIT is the first tool in the nation to monitor AI-related job loss using unemployment insurance claims data in near real-time. CAIT already captures, automatically and without any new employer reporting obligation, the core workforce data SB 951's notice provisions seek to generate. Specifically, the following SB 951 provisions are already captured by CAIT and are duplicative:

Proposed Section 1401(c)(3)(A) and Section 1402.7(b)(4)- Occupation and Layoff Classification Disclosure: SB 951 requires employers to disclose the number, classification, and work location of AI-driven layoffs. CAIT already automatically captures occupation codes, industry, and regional data for every Unemployment Insurance (UI) claimant through the existing UI claims process, without any employer filing obligation…”

FISCAL COMMENTS

According to the Assembly Appropriations Committee,

1. Costs of an unknown, but likely significant amount, in excess of $150,000, across state entities as employers to provide the technological cessation notice when applicable (General Fund (GF) or special fund). The magnitude of costs depends on the scope of work of the entity and the prevalence and use of AI systems in the workplace. For example, the California Community Colleges anticipates minor ongoing costs to the Chancellor’s Office and districts to provide the notice if and when there is a technological cessation in hiring. However, the University of California (UC) anticipates significant new administrative and compliance costs of a difficult-to-estimate amount to establish systemwide review and tracking infrastructure to evaluate AI-related workforce actions and provide the notice under applicable circumstances. The UC also notes costs related to legal review and training, as well as substantial indirect costs from delays or constraints in technology adoption and increased labor-relations activity.

Similarly, likely significant costs to local government employers, which the state would not need to reimburse because this bill’s new requirements for local agencies equally apply to the private sector.

1. Costs of approximately $10,000 one-time and $100,000 ongoing to EDD to establish procedures to receive the additional Cal/WARN notice and technological cessation notice, post summaries of the technological cessation notice online, and submit quarterly reports to the Legislature (GF).
2. Costs of approximately $1.5 million in the first year and $1.4 million annually thereafter to the Division of Labor Standards Enforcement (DLSE, also known as the LC), with greater workload attributed to enforcing the technological cessation notice requirement than the additional Cal/WARN notice requirement. DLSE anticipates needing to contract with AI experts to perform what would likely be lengthy investigations to determine whether an employer executed a technological cessation in hiring without filing a notice.
3. Ongoing cost pressures of an unknown amount to the courts in additional workload by creating the additional Cal/WARN notice requirement, as existing law allows an employee or employee representative to bring a civil action to establish liability for backpay and benefits against an employer that does not provide proper Cal/WARN notice to a covered establishment’s employees 60 days before the order takes effect (GF or Trial Court Trust Fund (TCTF)). It is unclear how many civil actions may be filed statewide and how much court time may be needed to resolve each case, but it generally costs approximately $1,000 to operate a courtroom for one hour. Although courts are not funded on the basis of workload, increased pressure on staff and the TCTF may create a demand for increased court funding from the GF. The state budget provides annual GF backfills to the TCTF to offset revenue reductions, totaling approximately $117.3 million in fiscal year 2025-26.

VOTES

SENATE FLOOR: 28-9-3

YES: Allen, Archuleta, Arreguín, Ashby, Blakespear, Cabaldon, Caballero, Cervantes, Cortese, Durazo, Gonzalez, Grayson, Laird, Limón, McGuire, McNerney, Menjivar, Padilla, Pérez, Reyes, Richardson, Rubio, Smallwood-Cuevas, Stern, Umberg, Wahab, Weber Pierson, Wiener

NO: Alvarado-Gil, Choi, Dahle, Jones, Niello, Ochoa Bogh, Seyarto, Strickland, Valladares

ABS, ABST OR NV: Becker, Grove, Hurtado

ASM LABOR AND EMPLOYMENT: 5-0-2

YES: Ortega, Arambula, Kalra, Lee, Ward

ABS, ABST OR NV: Alanis, Chen

ASM PRIVACY AND CONSUMER PROTECTION: 11-2-2

YES: Bauer-Kahan, Bryan, Irwin, Lowenthal, McKinnor, Ortega, Pellerin, Petrie-Norris, Ward, Bennett, Wilson

NO: Macedo, DeMaio

ABS, ABST OR NV: Hoover, Patterson

ASM APPROPRIATIONS: 10-3-2

YES: Wicks, Arambula, Calderon, Caloza, Fong, Mark González, Krell, Pellerin, Sharp-Collins, Solache

NO: Dixon, Ta, Tangipa

ABS, ABST OR NV: Hoover, Pacheco

UPDATED

VERSION: August 13, 2026

CONSULTANT: Megan Lane / L. & E. / (916) 319-2091 FN: 0003542

Date of Hearing: August 5, 2026

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Buffy Wicks, Chair

SBPCA Bill Id:SB 951

Author:(Reyes) – As Amended Ver:July 2, 2026

Urgency: No State Mandated Local Program: No Reimbursable: No

SUMMARY:

This bill expands the notice an employer must provide under the California Worker Adjustment and Retraining Act (Cal/WARN) for displacement caused by an artificial intelligence (AI) system and requires a broader scope of employers to provide a separate notice to the Employment Development Department (EDD) for a technological cessation in hiring.

Specifically, this bill:

1. Expands the existing 60-day notice an employer must provide under Cal/WARN to include the following additional information when the mass layoff, relocation, or termination is caused in whole or in substantial part by an AI system or other automated technology replacing or automating employment positions: (a) the number, classification or occupation, and work location of layoffs substantially due to replacement or automation by AI, (b) the job functions performed by displaced workers that will be automated by AI, and (c) the specific category or type of AI system that substantially resulted in technological displacement, including the entity that developed, sold, or leased the system (“additional Cal/WARN notice”).
2. Creates a new, separate notice requirement under Cal/WARN applicable to a more broadly defined “employer” that includes state and local government entities and an owner of any establishment, not just a covered establishment pursuant to the existing Cal/WARN definition, and requires that “employer” to provide EDD with a written technology hiring disruption notice when the employer executes a technological cessation in hiring (“technological cessation notice”).
3. Defines “technological cessation in hiring” to mean the permanent ending of hiring or contracting for a particular occupation or position, caused in whole or in substantial part by the employer’s use of AI or other automation, and requires the technological cessation notice to include similar information to what is required under the additional Cal/WARN notice, along with a statement if cessation resulted in hiring or creating other employment positions.
4. Requires EDD to post summaries of technological cessation notices received online and compile and submit to the Legislature a quarterly summary using these notices to present a statewide summary of worker displacement due to AI and automation.
5. Subjects an employer that fails to provide the additional Cal/WARN notice or technological cessation notice to EDD to a civil penalty of up to $500 for each day of the violation, and authorizes the Labor Commissioner (LC) to enforce either notice requirement following existing procedures.

FISCAL EFFECT:

1. Costs of an unknown, but likely significant amount, in excess of $150,000, across state entities as employers to provide the technological cessation notice when applicable (General Fund (GF) or special fund). The magnitude of costs depends on the scope of work of the entity and the prevalence and use of AI systems in the workplace. For example, the California Community Colleges anticipates minor ongoing costs to the Chancellor’s Office and districts to provide the notice if and when there is a technological cessation in hiring. However, the University of California (UC) anticipates significant new administrative and compliance costs of a difficult-to-estimate amount to establish systemwide review and tracking infrastructure to evaluate AI-related workforce actions and provide the notice under applicable circumstances. The UC also notes costs related to legal review and training, as well as substantial indirect costs from delays or constraints in technology adoption and increased labor-relations activity.

Similarly, likely significant costs to local government employers, which the state would not need to reimburse because this bill’s new requirements for local agencies equally apply to the private sector.

1. Costs of approximately $10,000 one-time and $100,000 ongoing to EDD to establish procedures to receive the additional Cal/WARN notice and technological cessation notice, post summaries of the technological cessation notice online, and submit quarterly reports to the Legislature (GF).
2. Costs of approximately $1.5 million in the first year and $1.4 million annually thereafter to the Division of Labor Standards Enforcement (DLSE, also known as the LC), with greater workload attributed to enforcing the technological cessation notice requirement than the additional Cal/WARN notice requirement. DLSE anticipates needing to contract with AI experts to perform what would likely be lengthy investigations to determine whether an employer executed a technological cessation in hiring without filing a notice.
3. Ongoing cost pressures of an unknown amount to the courts in additional workload by creating the additional Cal/WARN notice requirement, as existing law allows an employee or employee representative to bring a civil action to establish liability for backpay and benefits against an employer that does not provide proper Cal/WARN notice to a covered establishment’s employees 60 days before the order takes effect (GF or Trial Court Trust Fund (TCTF)). It is unclear how many civil actions may be filed statewide and how much court time may be needed to resolve each case, but it generally costs approximately $1,000 to operate a courtroom for one hour. Although courts are not funded on the basis of workload, increased pressure on staff and the TCTF may create a demand for increased court funding from the GF. The state budget provides annual GF backfills to the TCTF to offset revenue reductions, totaling approximately $117.3 million in fiscal year 2025-26.

COMMENTS:

1. Purpose. The author notes, “Employers are already citing AI as a reason for layoffs and hiring freezes, yet policymakers lack reliable data to understand the full impact.” According to the author:

SB 951 modernizes [the existing Cal/WARN Act] by requiring employers to provide a 60-day advance notice when mass layoffs are driven by [AI] or technological automation. This ensures workers and the state have time to prepare and respond, while also allowing the state to collect critical data on AI-realted job loss and workforce disruption. This information will help policymakers better understand how AI is reshaping our labor market and craft informed, proactive solutions.

1. Background. Governor’s Executive Order (EO). On May 21, 2026, Governor Newsom issued EO N-6-26, directing “California to prepare workers, small businesses, and communities for the economic disruption that [AI] will bring to the workforce.” Among other provisions, the EO requires the Labor and Workforce Development Agency, within 180 days of the EO’s issuance (November 17, 2026), to review and provide the Governor with recommendations on revisions and updates to Cal/WARN in a manner that is responsive to, and effectively provides early warning data on, emerging industry trends. The EO also requires EDD to: (a) include, as part of the California Labor Market Review, a summary of feedback from businesses about the role of technological adoption in determining hiring and workforce decisions, and (b) launch a dashboard showing AI’s impacts on employment across various sectors using Unemployment Insurance data (launched on June 25, 2026).

Cal/WARN. Cal/WARN requires an employer who directly or indirectly owns and operates a covered establishment, defined as an industrial or commercial facility that employs 75 or more people, to give 60 days’ notice when 50 or more workers during a single 30-day period may be impacted by a mass layoff, relocation, or termination. Notice must also be provided to specified government entities, including EDD and chief elected officials of the impacted city and county. Thus, Cal/WARN allows impacted employees to prepare for the potential loss of income and alerts impacted communities of the need to provide resources. Failure to provide appropriate notice exposes the employer to liability for backpay and the value of the cost of benefits to which an employee would have been entitled. Furthermore, an employer that does not compensate employees accordingly is subject to a civil penalty of $500 per day the employer is in violation.

This bill expands Cal/WARN in two ways. First, this bill expands the existing 60-day notice an employer must provide under Cal/WARN to include additional information when the mass layoff, relocation, or termination is caused in whole or in substantial party by an AI system replacing or automating employment positions – the additional Cal/WARN notice. Second, this bill requires a broader pool of employers, not just those that directly or indirectly own and operate a covered establishment, to provide EDD with a new, separate notice when the employer executes a technological cessation in hiring – the technological cessation notice. This bill provides that an employer that fails to provide the additional Cal/WARN notice is subject to existing Cal/WARN enforcement mechanisms, and makes an employer that fails to provide the technological cessation notice subject to Cal/WARN’s civil penalty and LC enforcement mechanisms only.

1. Support and Opposition. This bill is sponsored by the California Federation of Labor Unions, which argues, “AI poses an existential threat to human workers, government revenue, and society. The first step to tackling the growing threat is to collect and use reliable, local data to inform policy responses and to support workers who are the canaries in the coal mine of AI.” This bill is also supported by a coalition of other labor organizations and workers’ rights groups.

This bill is opposed by a coalition of business groups, led by the California Chamber of Commerce, which argues, “Enacting redundant employer reporting requirements on top of a functioning, real-time tracking system creates a duplicative and unnecessary compliance burden for employers” and that “data suggests that expanding statutory triggers tied to workforce changes can significantly increase litigation exposure under other laws.” This bill is also opposed by a coalition of public employers.

1. Related Legislation. AB 1883 (Bryan) prohibits an employer from using a workplace surveillance tool that uses AI for certain purposes. AB 1883 is pending hearing by the Senate Appropriations Committee.

AB 1898 (Schultz) requires an employer to notify a worker of the employer’s use of a workplace AI tool to make an employment-related decision or for workplace surveillance. AB 1898 was held on this committee’s suspense file.

AB 2027 (Ward) prohibits an employer from using a worker’s personal information to train an AI system to replicate, automate, or replace a worker’s job. AB 2027 was held on this committee’s suspense file.

AB 2545 (Schiavo) establishes the California AI Worker Impact Data Assessment Project at EDD. AB 2545 is pending hearing by the Senate Appropriations Committee.

SB 7 (McNerney) would have regulated an employer’s use of an Automated Decision System to make an employment-related decision. SB 7 was vetoed by Governor Newsom.

SB 238 (Smallwood-Cuevas) requires a business to annually provide a notice of all the workplace surveillance tools used in the workplace to the Department of Industrial Relations. SB 238’s hearing by the Assembly Privacy and Consumer Protection Committee was canceled at the request of the author.

SB 947 (McNerney) is similar to SB 7. SB 947 is pending hearing by this committee.

Analysis Prepared by: Irene Ho / APPR. / (916) 319-2081

Date of Hearing: July 1, 2026

Fiscal:

ASSEMBLY COMMITTEE ON PRIVACY AND CONSUMER PROTECTION

Rebecca Bauer-Kahan, Chair

SBPCA Bill Id:SB 951

Author:(Reyes) – As Amended Ver:June 22, 2026

PROPOSED AMENDMENTS

SENATE VOTE: 28-9

SUBJECT: Employment: technological displacement: notice

SYNOPSIS

Artificial intelligence (AI) and other automated technologies are rapidly changing California’s labor market, but policymakers lack reliable data about when, where, and how those technologies are contributing to layoffs, hiring freezes, or the permanent elimination of occupations and positions. Recent reports suggest that employers are increasingly citing AI as a reason for workforce reductions, while state leaders have begun examining how California should prepare workers, businesses, and communities for AI-related economic disruption. Existing law, including the Cal/WARN Act, provides advance notice for certain mass layoffs, relocations, and terminations, but does not specifically require employers to identify when those actions are driven by AI or automation.

SB 951 would establish the California Worker Technological Displacement Act and require employers to provide advance notice when artificial intelligence or other automated technology causes significant workforce disruption. Specifically, the bill would require at least 60 days’ written notice before a “technological displacement,” defined as a layoff of 50 or more workers in a 30-day period caused by AI or other automation replacing or automating employment positions. The bill would also require employers to notify the Employment Development Department (EDD) when they permanently stop hiring or contracting for a particular occupation or position because of AI or automation. EDD would be required to post summaries of these notices and compile quarterly statewide summaries of worker displacement due to AI and automation. Proposed Committee amendments, detailed in comments # 3 and 4, recast SB 951’s AI-related layoff notice requirements into the existing Cal/WARN framework, broaden the causation standard to include workforce actions caused “in whole or in substantial part” by AI or automation, clarify when a technological cessation in hiring occurs, and make minor technical and conforming changes.

This bill is sponsored by the California Federation of Labor Unions and supported by a broad coalition of labor advocacy groups. It is opposed by a broad coalition of business advocacy groups, including the California Chamber of Commerce. A variety of public employers strike an “oppose unless amended” position. The bill was previously heard in the Labor and Employment Committee, where it passed on a 5-0 vote.

EXISTING LAW:

1. Defines “artificial intelligence” to mean an engineered or machine-based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments. (Gov. Code § 11546.45.5.)
2. Establishes the California Worker Adjustment and Retraining Act (Cal/WARN), which prohibits an employer with 75 or more full and part-time employees from ordering a layoff of 50 or more employees within a 30-day period, relocation, or termination at a covered establishment, as defined, unless the employer gives written notice to all of the following 60 days before the order takes effect:
3. The employees of the covered establishment affected by the order.
   
4. The Employment Development Department (EDD), the local workforce investment board, and the chief elected official of each city and county government within which the termination, relocation, or mass layoff occurs. (Lab. Code § 1400-1413.)
5. Defines, for purposes of the Cal/WARN Act, an “employer” to mean any person, association, organization, partnership, business trust, limited liability company, or corporation who directly or indirectly owns and operates a covered establishment. A parent corporation is an employer as to any covered establishment directly owned and operated by its corporate subsidiary. (Lab. Code § 1400.5)
6. Exempts from the provisions of Cal/WARN seasonal employees and employees that are laid off due to the completion of a project in specified industries, where the employers are subject to specified wage orders, and the employees were hired with the understanding that their employment was seasonal and temporary. (Lab. Code § 1400.5.)
7. Requires employers that are mandated to give notice of a mass layoff, relocation, or termination pursuant to Cal/WARN to include in the notice the elements required by the federal WARN Act. (Lab. Code §1401.)
8. Provides that an employer that fails to give the required Cal/WARN notice before ordering a mass layoff, relocation, or termination is liable to each employee that was entitled to notice, for specified back pay and medical expenses incurred that would have been covered under an employee benefit plan, calculated for the period of the employer’s violation, up to a maximum of 60 days, or half the number of days that the employee was employed by the employer, whichever period is shorter. (Lab. Code § 1402.)
9. Provides that an employer who fails to give the required Cal/WARN notice is subject to a civil penalty of not more than five hundred dollars ($500) for each day of the employer’s violation. Exempts an employer from this civil penalty if the employer pays all applicable employees within three weeks from the date the employer ordered the mass layoff, relocation, or termination. (Lab. Code § 1403.)
10. Permits a person, including a local government, or an employee representative, seeking to establish liability against an employer for violation of Cal/WARN to bring a civil action on behalf of the person, other persons similarly situated, or both, in any court of competent jurisdiction. Additionally, permits a court to award reasonable attorney’s fees as part of the costs to any plaintiff who prevails in a civil action. (Lab. Code § 1404.)
11. Establishes the Department of Industrial Relations (DIR) in the Labor and Workforce Development Agency (LWDA), and vests it with various powers and duties to foster, promote, and develop the welfare of the wage earners of California, to improve their working conditions, and to advance their opportunities for profitable employment. (Lab. Code § 50.5.)
12. Establishes various entities within DIR, including the Division of Labor Standards Enforcement under the direction of the Labor Commissioner (LC), and empowers the LC with ensuring a just day’s pay in every workplace and promotes economic justice through robust enforcement of labor laws. (Lab. Code § 79-107.)
13. Establishes EDD in LWDA, and vests it with various duties and responsibilities including job creation activities, administration of the Unemployment, Disability, and Paid Family Leave programs, collection of payroll taxes, keeping track of employment records, managing federal job training programs, and collecting and sharing information about the job market. (Unemp. Ins. Code § 301.)
    

THIS BILL:

1. Defines the following terms:
2. “Employer” means any person, as defined by Section 18, who directly or indirectly owns and operates a covered establishment. A parent corporation is an employer as to any covered establishment directly owned and operated by its corporate subsidiary. An “employer” includes, but is not limited to, any of the following:
   
3. The state, including its legislative, judicial, and executive branches.
   
4. Any city, county, or city and county, including any charter city, charter county, charter city and county, and other political subdivisions of the state.
   
5. Special districts.
   
6. Local educational agencies and community college districts that do not provide layoff notices pursuant to specified statutes of the Education Code for academic, classified, or certificated staff.
   
7. Any authority, commission, board, agency, or instrumentality of any entity specified in paragraphs (1) to (3), inclusive.
   
8. The University of California, the California State University, and community college districts.
9. “Technological displacement” means a layoff during any 30-day period of 50 or more workers caused in whole by an AI system or other automated technology replacing or automating employment positions.
10. “Technological cessation in hiring” means the end of hiring permanently for an occupation or position that is caused in whole by the use of AI or other automation. “Technological cessation in hiring” does not mean an overall reduction in employment positions.
11. “Worker” means any natural person who is an employee of, or an independent contractor providing service to, or through, a business or a state or local governmental entity in any workplace, for at least 6 months of the 12 months preceding the date on which notice is required under this article. “Worker” includes, but is not limited to, full-time and part-time workers but does not include a seasonally employed individual who was hired with the understanding that their employment is seasonal and temporary, a volunteer, or an intern.
12. Requires an employer to provide at least a 60-day advanced written notice before any technological displacement.
13. Requires the notice to be provided to all of the following:
14. The workers of the employer affected by the technological disruption.
15. The Employment Development Department.
16. The local workforce investment board, city council members, and county board of supervisors of each city and county in the state within which the technological displacement occurs.
17. Requires the notice to contain all of the following information:
18. The name and address of the employment site and the name, email, and telephone number of a company official or public agency contact person.
19. A statement indicating whether the planned action is permanent or temporary.
20. The expected date of the first separation and the anticipated schedule for subsequent separations.
21. The number, classification or occupation, and work location of layoffs that are substantially due to the replacement or automation by AI.
22. The job functions performed by those workers that will be automated by AI.
23. The specific category or type of AI system or other automating technology that substantially resulted in technological displacement, including the entity or entities that developed, sold, or leased the product.
24. If retraining is available to current workers to transition from eliminated occupations to new ones at the company.
25. Whether the employer plans to coordinate services, such as a rapid response orientation, through the local workforce development board, a different entity, or the employer does not plan to coordinate services with any entity.
26. A functioning email and telephone number of the board and a description of the rapid response activities offered by the local workforce development board.
27. Requires the employer to arrange services within 30 days from the date of the notice if the employer chooses to coordinate services with the local workforce development board or another entity.
28. For employers with more than 100 workers, provides that each worker affected by a technological displacement is entitled to the right of first bid on other positions with the employer, except to the extent that right would conflict with the provisions of a collective bargaining agreement.
29. Prohibits an employer from discharging a worker affected by a technological displacement without reasonable and substantiated cause during the 60-day period from when the notice is provided to the worker.
30. Requires an employer to provide a written technology hiring disruption notice when it executes a technological cessation in hiring caused in whole by the adoption of AI or other automating technology.
31. Requires the notice to be given to the Employment Development Department.
32. Requires the notice to include all of the following information:
33. The name and address of the employment site and the name, email, and telephone number of a company official or public agency contact person.
34. A statement indicating whether the planned action is permanent or temporary.
35. The number of positions of the employer that were occupied at any point during the prior quarter for which the employer has decided not to fill because of a technological cessation in hiring.
36. The classification or occupation, and work location of positions that will no longer be filled by humans due to the replacement or automation by AI.
37. The job functions performed in these positions.
38. The specific category or type of AI system or other automating technology that resulted in the technological cessation of hiring, including the entity or entities that developed, sold, or leased the product.
39. A statement if the cessation resulted in hiring or creation of other employment positions in the company and the number and occupation of those positions.
40. Provides that if a workforce action triggers notice obligations under both this bill and the Cal/WARN Act, a covered employer may include the notice required under this bill as part of the notice requirements under Cal/WARN, and provides that a covered employer shall not be required to separately comply with this bill.
41. Requires a local education agency that provides layoff notices for classified and certificated staff under applicable law, or a community college district that provides layoff notices for academic and classified employees under applicable law, to provide the Employment Development Department with a written technology displacement or cessation in hiring notice on an annual basis when it executes a relevant workforce action.
42. Requires the Employment Development Department to post summaries of notices received pursuant to this bill on their internet website as part of the existing notice requirements of the Cal/WARN Act, and to compile a quarterly summary using those notices to present a statewide summary of worker displacement due to AI and automation. Requires the report to include a link to the Cal/WARN Act notice report internet website.
43. Requires the Employment Development Department to submit the report to the Labor and Budget Committees of the Assembly and Senate.
44. Provides that an employer that fails to give notice under this bill before ordering a technological displacement is subject to enforcement under the existing Cal/WARN Act.
45. Establishes the Technological Displacement Act Fund within the State Treasury, and requires all civil penalties recovered by the Labor Commissioner pursuant to this article to be deposited into the fund. Makes all moneys in the fund available to the commissioner, upon appropriation by the Legislature, for purposes of enforcing this article.
46. Provides that this act does not supercede greater protections provided by a collective bargaining agreement.
47. Permits the Labor Commissioner and Employment Development Department to adopt rules and regulations as necessary and proper to effectuate the purposes of this article

COMMENTS:

1. Author’s statement. According to the author:

Artificial Intelligence is transforming our economy at an unprecedented pace. Unlike past technological advances, AI has the ability to automate entire occupations almost overnight, leaving workers vulnerable to sudden economic disruption. Employers are already citing AI as a reason for layoffs and hiring freezes, yet policymakers lack reliable data to understand the full impact. Without this information, government is forced to respond only after workers have already lost their livelihoods.

SB 951 modernizes California’s existing Worker Adjustment and Retraining Notification Act by requiring employers to provide a 60-day advance notice when mass layoffs are driven by artificial intelligence or technological automation. This ensures workers and the state have time to prepare and respond, while also allowing the state to collect critical data on AI-related job loss and workforce disruption. This information will help policymakers better understand how AI is reshaping our labor market and craft informed, proactive solutions.

Innovation should not come at the expense of working families. SB 951 ensures transparency, preparedness, and accountability as artificial intelligence becomes a permanent part of California’s economy.

1. Background. AI and GenAI. In brief, AI is the mimicking of human intelligence by artificial systems such as computers. AI uses algorithms – sets of rules – to transform inputs into outputs. Inputs and outputs can be anything a computer can process: numbers, text, audio, video, or movement. AI is not fundamentally different from other computer functions; its novelty lies in its application. Unlike traditional computer functions, AI can accomplish tasks that are normally performed by humans. AI that is trained on small, specific datasets to make recommendations and predictions is sometimes referred to as “predictive AI.” This differentiates it from GenAI, which is trained on massive datasets in order to produce detailed text and images. When Netflix suggests a TV show to a viewer, that recommendation is produced by predictive AI that has been trained on the viewing habits of Netflix users. When ChatGPT generates text in clear, concise paragraphs, it uses GenAI that has been trained on the written contents of the internet.
   
   Automated decision systems. Automated decision systems (ADS) typically use predictive AI to produce simplified outputs – such as scores, classifications, or recommendations – to assist or replace human discretionary decisionmaking.^[1] ADS can process enormous datasets, identify hidden patterns, and make decisions with efficiency and scale that vastly exceeds human capabilities. This has led to profoundly beneficial applications and breakthroughs.^[2]

But relying on ADS can be hazardous if the systems are not trained carefully or tested thoroughly: the datasets they are trained on are often unrepresentative or contaminated with bias, the inferences ADS draw from those datasets are often inscrutable, and these systems can fail to accurately account for the complexity of human behavior. When deployed without proper oversight in consequential contexts such as employment, housing, healthcare, and criminal justice, the impacts of flawed ADS can be devastating.

AI’s effect on labor markets. According to a recent report from executive outplacement firm Challenger, Gray & Christmas, AI was responsible for 54,836 announced layoffs in the United States in 2025.^[3] Earlier this year, a Resume.org survey of 1000 United States hiring managers revealed that 55% of companies expected further layoffs in 2026, and that 44% of these companies cited AI as a top driver – though 59% admitted they intentionally emphasized AI when explaining hiring freezes or layoffs because it “plays better with stakeholders.” ^[4] It is difficult to separate the signal from the noise when assessing the effect that advanced AI is having on the labor market, as emphasized in a recent review published in Computers in Human Behavior Reports:

The use of Generative AI has significant effects on businesses and the labor market. One of the key contributions of this technology is the ability to generate content. However, the generation of inaccurate and incomplete content by AI may lead to a decrease in trust in the technology. In some industries and occupations, Generative AI may replace employees in content creation activities and related tasks, reducing job opportunities in these sectors. On the other hand, GenAI may create new specializations in content creation, leading to new job opportunities for people with AI-related knowledge.^[5]

Ford CEO Jim Farley recently expressed his belief that “artificial intelligence is going to replace literally half of all white collar workers,”^[6] a belief shared by Anthropic CEO Darius Amodei.^[7] On the other hand, Nvidia CEO Jensen Huang recently predicted that AI will primarily augment, rather than replace, American workers.^[8] Anthropic’s “Economic Index” tool, which tracks AI usage trends across the workforce, reveals that California currently ranks fifth among states in terms of AI usage, behind Washington DC, Massachusetts, Washington state, and New York.^[9]

California’s creative economy. The creative economy is both hugely important to California and particularly sensitive to AI. The Otis College 2025 Report on the Creative Economy estimates that California’s creative economy employs more than 760,000 workers with an average salary of $191,000 per year, accounting for roughly 5% of the state’s workforce.^[10] The 2023 version of this report estimated that California’s creative economy was responsible for 14.9% of the state’s $3.4 trillion economy in 2021, generating over $194.1 billion in federal, state, and municipal taxes.^[11]

While the adoption of GenAI is opening up new possibilities in music, film, publishing and other creative fields, the technology’s impact on California’s creative economy and individual creators remains uncertain and unevenly distributed. To date, few studies have assessed how AI will affect jobs and incomes for writers, actors, musicians, designers and other creators. A global report published by the International Confederation of Societies of Authors and Composers (CISAC and PMP Strategy) in December of 2024 projected the emergence of a massive market for AI-generated content. The study estimated that AI-generated audiovisual content, including film and TV, could be worth €48 billion ($55.73 billion) by 2028. However, the report warned that up to 21% of creators’ revenue in film and TV could be cannibalized as a result:

In an unchanged regulatory framework, creators will actually suffer losses on two fronts: the loss of revenues due to the unauthorised use of their works by Gen AI models without remuneration; and replacement of their traditional revenue streams due to the substitution effect of AI-generated outputs, competing against human- made works.^[12]

Tech industry layoffs. Over the past two years, major California-based tech companies have laid off hundreds of thousands of workers around the globe. These companies have increasingly linked these layoffs to AI: in March, Reuters reported that Meta’s layoff plans, which could affect 20% or more of the company, were intended to offset AI infrastructure investments and prepare for greater efficiency brought about by AI-assisted workers.^[13] Oracle similarly laid off 30,000 employees in late March – representing roughly 18% of its global workforce – in order to fund its commitment to aggressively build out AI infrastructure.^[14] Amazon announced plans to lay off 16,000 employees in January of this year, its second round of large-scale job reductions in three months. The company announced in a blog post that the layoffs were necessary to increase its decision-making speed.^[15] Jack Dorsey, founder and CEO of startup “Block, Inc” tied cutting 40% of his company to advances in efficiency due to AI in a recent X post:

we're not making this decision because we're in trouble. our business is strong. gross profit continues to grow, we continue to serve more and more customers, and profitability is improving. but something has changed. we're already seeing that the intelligence tools we’re creating and using, paired with smaller and flatter teams, are enabling a new way of working which fundamentally changes what it means to build and run a company. and that's accelerating rapidly.^[16]

Blueprint for an AI bill of rights. In 2022, the White House Office of Science and Technology Policy released the Blueprint for an AI Bill of Rights, which identifies five principles that should “guide the design, use, and deployment of automated systems to protect the American public in the age of artificial intelligence.”^[17] As summarized in the Blueprint, the principles are as follows:

• Safe and Effective Systems: You should be protected from unsafe or ineffective systems. Automated systems should be developed with consultation from diverse communities, stakeholders, and domain experts to identify concerns, risks, and potential impacts of the system. Systems should undergo pre-deployment testing, risk identification and mitigation, and ongoing monitoring that demonstrate they are safe and effective based on their intended use, mitigation of unsafe outcomes including those beyond the intended use, and adherence to domain-specific standards. Outcomes of these protective measures should include the possibility of not deploying the system or removing a system from use. Automated systems should not be designed with an intent or reasonably foreseeable possibility of endangering your safety or the safety of your community. They should be designed to proactively protect you from harms stemming from unintended, yet foreseeable, uses or impacts of automated systems. You should be protected from inappropriate or irrelevant data use in the design, development, and deployment of automated systems, and from the compounded harm of its reuse. Independent evaluation and reporting that confirms that the system is safe and effective, including reporting of steps taken to mitigate potential harms, should be performed and the results made public whenever possible.
• Algorithmic Discrimination Protections: You should not face discrimination by algorithms and systems should be used and designed in an equitable way. . . . Designers, developers, and deployers of automated systems should take proactive and continuous measures to protect individuals and communities from algorithmic discrimination and to use and design systems in an equitable way. This protection should include proactive equity assessments as part of the system design, use of representative data and protection against proxies for demographic features, ensuring accessibility for people with disabilities in design and development, pre-deployment and ongoing disparity testing and mitigation, and clear organizational oversight. Independent evaluation and plain language reporting in the form of an algorithmic impact assessment, including disparity testing results and mitigation information, should be performed and made public whenever possible to confirm these protections.
• Data Privacy: [. . .] Designers, developers, and deployers of automated systems should seek your permission and respect your decisions regarding collection, use, access, transfer, and deletion of your data in appropriate ways and to the greatest extent possible; where not possible, alternative privacy by design safeguards should be used [. . .] Enhanced protections and restrictions for data and inferences related to sensitive domains, including health, work, education, criminal justice, and finance, and for data pertaining to youth should put you first. In sensitive domains, your data and related inferences should only be used for necessary functions, and you should be protected by ethical review and use prohibitions. [. . .]
• Notice and Explanation: You should know that an automated system is being used and understand how and why it contributes to outcomes that impact you. Designers, developers, and deployers of automated systems should provide generally accessible plain language documentation including clear descriptions of the overall system functioning and the role automation plays, notice that such systems are in use, the individual or organization responsible for the system, and explanations of outcomes that are clear, timely, and accessible. Such notice should be kept up-to-date and people impacted by the system should be notified of significant use case or key functionality changes. You should know how and why an outcome impacting you was determined by an automated system, including when the automated system is not the sole input determining the outcome. [ . . . ]
• Human Alternatives, Consideration, and Fallback: You should be able to opt out from automated systems in favor of a human alternative, where appropriate. Appropriateness should be determined based on reasonable expectations in a given context and with a focus on ensuring broad accessibility and protecting the public from especially harmful impacts. [ . . .]

The Legislature adopted these principles via SCR 17 (Dodd, 2023.)

Executive Order N-6-26. On May 19, 2026, Governor Newsom called publicly for an overhaul of California’s economic and tax policy:

“You cannot save democracy unless we democratize the economy,” the Democratic California governor said at a Center for American Progress event in Washington. “The whole system has to be reimagined.”

. . .

Newsom argued that Democrats needed to advance beyond “tinkering” and pursue ideas, like universal basic capital or wage replacement, to counteract job losses from artificial intelligence. He said rapid advancement in AI would “detonate” the prevailing order and argued technology-fueled economic precarity was already reordering politics.^[18]

Two days later Governor Newsom issued Executive Order N-6-26, directing “California to prepare workers, small businesses, and communities for the economic disruption that artificial intelligence will bring to the workforce.^[19]” The Order does all of the following:

1. Requires the Labor and Workforce Development Agency (LWDA), GO-Biz, and the Department of Finance, in consultation with academic and relevant industry partners and other state agencies, as appropriate, to provide to the Governor a review of the emerging body of academic research identifying the potential workforce impacts of technological shifts, including AI’s impact on California’s labor market and potential disproportionate impacts on demographic groups.
   
2. Requires LWDA to do all of the following:
   
3. Review and provide to the Governor recommendations on revisions and updates to the Cal/WARN Act.
   
4. Submit to the Governor a review of policies and practices that provide displaced workers with a safety net, including severance and other forms of compensation such as stock or other forms of equity, and any recommendations for incorporating such policies or strengthening existing programs.
   
5. Submit to the Governor a workplan for expanding awareness of and enrollment in employment insurance programs.
   
6. Identify, promote and enhance service opportunities, including through California Volunteers, for those experiencing long-term unemployment and other potential employment disruption.
   
7. Submit to the Governor recommendations on options for improving efforts to connect unemployed workers to opportunities for training and upskilling.
   
8. Review how the collective bargaining process is incorporating and addressing new technologies, such as AI, in ways tailored to the specific needs of workers and employers no later than October 15, 2026.
   
9. Review existing workforce training programs to ensure programs are fit for purpose and targeted towards growing industries and professions, and requires the Employment Development Department (EDD) to develop an AI playbook to expand dislocated worker strategies for occupations exposed to AI and provide Local Boards with technical assistance, no later than October 15, 2026.
   
10. Requires EDD to do all of the following:
    
11. Include a summary of feedback from businesses about the role of technological adoption in determining hiring or workforce decisions in the California Labor Market Review.
    
12. Launch a dashboard showing AI’s impacts on employment across various sectors using Unemployment Insurance data within 90 days.
    
13. Requires the Jobs First Council to work with local leadership on opportunities to support regions facing systemically high unemployment.
    
14. Requires the Government Operations Agency to provide the Governor with options and recommendations for actions that could alter incentive structures and increase likelihood of AI development and deployments that advance the public good and address critical problems and emerging opportunities facing society.
    
15. Requires the Governor’s Office for Business and Economic Development (GO-Biz) to do both of the following:
    
16. Evaluate and, where appropriate, support opportunities to expand and enhance worker ownership models to support broad-based capital growth and build wealth from productivity gain among workers.
    
17. Engage in educational and other initiatives to support business adoption of “opportunity AI.”
    
18. Requires the California Health and Human Services Agency to leverage the Office of Data and Innovation’s single online platform to enable Californians to more easily navigate government services.
    

Ultimately, while Executive Order N-6-26 does not empower California’s workers to contend with the rapid adoption of AI in workplaces across the state, it does commission several studies into the matter.

Cal/WARN. The Senate Committee on Labor, Public Employment, and Retirement’s analysis of this bill describes Federal WARN and Cal/WARN notification requirements:

The federal WARN Act requires employers to provide written notice 60 days prior to a plant closing or mass layoff to employees, or their representative, the State dislocated worker unit (EDD, Workforce Services Division in California), and the chief elected official of local government within which such closing or layoff occurs. The federal WARN Act applies to employers with 100 or more full-time employees. Notices are required as follows:

• Plant closings involving 50 or more employees during a 30-day period.
• Layoffs within a 30-day period involving 50 to 499 full-time employees constituting at least 33% of the full-time workforce at a single site of employment.
• Layoffs of 500 or more are covered regardless of percentage of workforce. (29 USC, et seq., 2101 and 20 CFR 639.3)

Similarly, Cal/WARN requires employers to give a 60-day notice to the affected employees and both state and local representatives before a mass layoff, relocation, or termination. The Cal/WARN provisions apply to employers of 75 or more full-time and part-time employees. Notices are required as follows:

• For a plant closure affecting any amount of employees.
• Layoff of 50 or more employees within a 30-day period regardless of % of workforce.
• Relocation of at least 100 miles affecting any amount of employees.
• Relocation of a call center to a foreign country regardless of the percentage of workforce affected. [California Labor Code Section 1400.5 (d)-(f) and 1409 (b)]

Advance notification before a termination or layoff provides employees with necessary time to transition and adjust to the potential loss of employment, time to seek alternative employment and, if necessary, time to obtain skills training or retraining to successfully compete in the job market.

1. What this bill would do. This bill would establish the “California Worker Technological Displacement Act,” consisting of two distinct components:
2. A requirement for an employer to notify workers, EDD, and local government representatives 60-days advanced written notice prior to any “technological displacement” – a layoff affecting 50 or more workers caused in whole by an AI system or other automated technology.
3. A requirement for an employer to notify EDD when it executes a “technological cessation in hiring” – the end of hiring permanently for an occupation or position that is caused in whole by the use of AI.

The technological displacement provisions of SB 951 are drafted in the spirit of the Cal/WARN Act, but differ in several important ways:

• Cal/WARN defines “employer” to mean a person, association, organization, partnership, business trust, limited liability company, or corporation who directly or indirectly owns and operates a covered establishment. This bill expands that definition to include:
  • The state, including its legislative, judicial, and executive branches.
    
  • Any city, county, or city and county, including any charter city, charter county, charter city and county, and other political subdivisions of the state.
    
  • Special districts.
    
  • Local educational agencies and community college districts that do not provide layoff notices pursuant to Sections 45117, 44955, 87740, and 88017 of the Education Code for academic, classified, or certificated staff.
    
  • Any authority, commission, board, agency, or instrumentality of any entity specified in paragraphs (1) to (3), inclusive.
    
  • The University of California, the California State University, and community college districts.
• Cal/WARN defines “employee” to mean a person employed by an employer for at least 6 months of the 12 months preceding the date on which notice is required. This bill instead defines “worker” to mean any natural person who is an employee of, or an independent contractor providing service to, or through, a business or a state or local governmental entity in any workplace, for at least 6 months of the 12 months preceding the date on which notice is required under this article. “Worker” includes, but is not limited to, full-time and part-time workers but does not include a seasonally employed individual who was hired with the understanding that their employment is seasonal and temporary, a volunteer, or an intern.

Due to these two definitional changes, SB 951 applies to a greater number of employees and workers compared to Cal/WARN. This risks creating confusion when layoffs occur: a particular employer might find themselves subject to Cal/WARN, SB 951, or both, depending on where they are situated in California’s economy. Worse, an employer that is subject to both frameworks can have varying obligations with respect to different employees: a community college district that experiences a technological displacement would be required to provide an SB 951 compliant notice to independent contractors, while providing a Cal/WARN+SB 951 compliant notice to full-time employees.

• Cal/WARN requires notices be provided to each chief elected official of each city and county government within which a termination, relocation, or mass layoff occurs. SB 951 instead requires that notice be provided to city council members and county boards of supervisors.

In the hypothetical scenario outlined above, a community college district would be required to notify city councilors and county supervisors of a layoff of an independent contractor, but would be additionally be required to notify the chief elected official of each city and county for Cal/WARN-eligible employees.

SB 951 would additionally create a “right of first bid” on other positions with the employer for workers affected by technological displacements, and would prohibit an employer from discharging a worker affected by a technological displacement without reasonable and substantiated cause during the 60-day period following the notice. Neither of these rights exist under the Cal/WARN framework, creating further daylight between workers whose displacements are due to AI or automation, and those whose displacements are not.

Silicon Valley Leadership Group (SVLG) summarizes these issues, writing in opposition:

The covered population remains broader than Cal-WARN’s. Although the June 22 amendments raised the numeric trigger to 50 workers, SB 951 counts independent contractors toward that threshold and layers AI-specific notice, disclosure, and liability mandates on top of Cal-WARN obligations that do not exist for economically driven layoffs of the same size. The result remains an asymmetric and disproportionate compliance burden for AI-related workforce decisions.

The bill still covers independent contractors with at least six months of tenure — sweeping in contingent workers who are categorically different from permanent employees and who are not covered under Cal-WARN. This expansion lacks any policy justification rooted in the bill’s stated goals.

. . .

For employers with more than 100 workers, the bill continues to grant each displaced worker a right of first bid on other positions with the employer. When a workforce restructuring simultaneously triggers both a traditional Cal-WARN notice and an SB 951 AI displacement notice, employers will face overlapping and potentially inconsistent obligations regarding worker prioritization — creating litigation exposure and operational uncertainty that will discourage rather than support responsible workforce transitions.

Separately, a coalition of public employers led by the Rural County Representatives of California takes an “oppose unless amended” position on the bill, writing the following:

Local agencies remain subject to the statutory provisions of the Meyers-Milias-Brown Act (MMBA), which require local agencies to meet and confer with recognized employee organizations regarding changes to employees’ wages, hours, or terms and conditions of employment. In those cases, existing law provides a robust framework for determining when particular uses of technology may actually have a significant and adverse effect on the employment relationship, in which case notification (and more) is already required.

In addition, for public employers with represented workforces, including cities, counties, and special districts, the use of technology tools is often bargained between employees and public employers based on local conditions, security needs, and the concerns of the public workforce. State law already prohibits local public employers from using workplace technology tools to deter or discourage union membership. Specifically, Government Code Section 3550 provides that a public employer shall not deter or discourage public employees, or applicants to be public employees, from becoming or remaining members of an employee organization. Section 3551.5 imposes significant penalties for violations of Section 3550 and grants employee organizations standing to bring the claims. Because of the existing protections already afforded to public employees, our organizations have concerns regarding the likelihood of overlapping or conflicting requirements introduced by this bill that will create uncertainty and liability for local agencies.

Furthermore, SB 951's requirement that certain employers, including many public agencies, provide displaced workers with a "right of first bid" on other positions would directly conflict with long-established merit-based civil service systems and collectively bargained labor agreements that govern the vast majority of public-sector hiring. These systems prescribe detailed procedures for filling vacancies, including competitive examinations, minimum qualifications, seniority provisions, reemployment lists, promotional opportunities, and negotiated bumping and layoff rights. By creating a new statutory hiring preference that supersedes these established processes, SB 951 would create significant legal uncertainty and expose public employers to competing obligations under state labor laws, civil service rules, and local personnel ordinances.

To address these concerns, the author has agreed to a Committee amendment recasting the “technological displacement” sections of SB 951 into the existing Cal/WARN statute.

SVLG continues, describing the bill’s “caused in whole by an AI system or other automated technology” standard as problematic:

By conditioning every obligation on a layoff being “caused in whole” by AI, the bill builds itself around a fact that is nearly impossible to establish. Recent experience in other jurisdictions illustrates the difficulty of attributing job loss directly to AI. Despite more than 160 mass termination notices filed following enactment of New York’s AI WARN law in 2025, none were attributed solely to AI-related displacement. Business decisions are typically influenced by multiple overlapping factors — economic conditions, budget constraints, organizational restructuring, and market demands — that interact with technology adoption in ways that resist clean attribution.

As SVLG points out, it is unlikely that any layoff will ever be solely due to AI or automation – businesses are complicated entities, and every decision a business makes can be attributed to many factors.

To address this concern, the author has agreed to a Committee amendment expanding this standard to displacements or cessations “caused in whole or in substantial part” by AI or automation.

In SB 951’s “technological cessation in hiring” provisions, it is unclear whether a cessation has occurred if an employer has ceased hiring, but still employs workers in a particular position.

To address this concern, the author has agreed to a Committee amendment clarifying that a technological cessation applies “whether any workers in that occupation or position remain employed or under contract.”

The author has additionally agreed to Committee amendments making minor technical and conforming changes throughout.

1. Bill as proposed to be amended. The complete text of SB 951 as proposed to be amended is reproduced below:

1400. This chapter may be cited as the “California Worker Adjustment and Retraining Act” or “Cal/WARN Act.”

1400.5. The definitions set forth in this section shall govern the construction and meaning of the terms used in this chapter:

(x) “Artificial intelligence” or “AI” means an engineered or machine-based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.

(a) “Covered establishment” means any industrial or commercial facility or part thereof that employs, or has employed within the preceding 12 months, 75 or more persons.

(b) “Employer” means any person, as defined by Section 18, who directly or indirectly owns and operates a covered establishment. A parent corporation is an employer as to any covered establishment directly owned and operated by its corporate subsidiary.

(c) “Layoff” means a separation from a position for lack of funds or lack of work.

(d) “Mass layoff” means a layoff during any 30-day period of 50 or more employees at a covered establishment.

(e) “Relocation” means the removal of all or substantially all of the industrial or commercial operations in a covered establishment to a different location 100 miles or more away.

(f) “Termination” means the cessation or substantial cessation of industrial or commercial operations in a covered establishment.

(g) (1) This chapter does not apply where the closing or layoff is the result of the completion of a particular project or undertaking of an employer subject to Wage Order 11, regulating the Broadcasting Industry, Wage Order 12, regulating the Motion Picture Industry, or Wage Order 16, regulating Certain On-Site Occupations in the Construction, Drilling, Logging and Mining Industries, of the Industrial Welfare Commission, and the employees were hired with the understanding that their employment was limited to the duration of that project or undertaking.

(2) This chapter does not apply to employees who are employed in seasonal employment where the employees were hired with the understanding that their employment was seasonal and temporary.

(h) “Employee” means a person employed by an employer for at least 6 months of the 12 months preceding the date on which notice is required.

1401. (a) An employer may not order a mass layoff, relocation, or termination at a covered establishment unless, 60 days before the order takes effect, the employer gives written notice of the order to the following:

(1) The employees of the covered establishment affected by the order.

(2) The Employment Development Department, the local workforce development board, and the chief elected official of each city and county government within which the termination, relocation, or mass layoff occurs.

(b) An employer required to give notice of any mass layoff, relocation, or termination under this chapter shall include in its notice the elements required by the federal Worker Adjustment and Retraining Notification Act (29 U.S.C. Sec. 2101 et seq.).

(c) An employer required to give notice of any mass layoff, relocation, or termination under this chapter shall include in the notice whether the employer plans to coordinate services, such as a rapid response orientation, through the local workforce development board, the employer plans to coordinate services through a different entity, or the employer does not plan to coordinate services with any entity.

(1) Regardless of whether the employer chooses to coordinate services with the local workforce development board or another entity, the employer shall include in the notice a functioning email and telephone number of the board and the following description of the rapid response activities offered by the local workforce development board in accordance with Chapter 32 (commencing with Section 3102) of Title 29 of the United States Code:

“Local Workforce Development Boards and their partners help laid off workers find new jobs. Visit an America’s Job Center of California location near you. You can get help with your resume, practice interviewing, search for jobs, and more. You can also learn about training programs to help start a new career.”

(2) If the employer chooses to coordinate services with the local workforce development board or another entity, the employer shall arrange services within 30 days from the date of the notice.

(3) An employer required to give notice of a mass layoff, relocation, or termination caused in whole or in substantial part by an AI system or other automated technology replacing or automating employment positions shall additionally include in the notice all of the following information:

(A) The number, classification or occupation, and work location of layoffs that are substantially due to the replacement or automation by AI.

(B) The job functions performed by those workers that will be automated by AI.

(C) The specific category or type of AI system or other automating technology that substantially resulted in technological displacement, including the entity or entities that developed, sold, or leased the product.

(d) An employer required to give notice of any mass layoff, relocation, or termination under this chapter shall include in the notice a description of the statewide food assistance program known as CalFresh (Chapter 10 (commencing with Section 18900) of Part 6 of Division 9 of the Welfare and Institutions Code), the CalFresh benefits helpline, and a link to the CalFresh internet website.

(e) An employer required to give notice of any mass layoff, relocation, or termination under this chapter shall include in the notice a functioning email and telephone number of the employer for contact.

(f) Notwithstanding the requirements of subdivision (a), an employer is not required to provide notice if a mass layoff, relocation, or termination is necessitated by a physical calamity or act of war.

1402.7. (a) For purposes of this section, the following definitions apply:

(1) Notwithstanding Section 1400.5, “employer” means any person, as defined by Section 18, who directly or indirectly owns and operates an establishment. A parent corporation is an employer as to any establishment directly owned and operated by its corporate subsidiary. An “employer” includes, but is not limited to, any of the following:

(A) The state, including its legislative, judicial, and executive branches.

(B) Any city, county, or city and county, including any charter city, charter county, charter city and county, and other political subdivisions of the state.

(C) Special districts.

(D) Local educational agencies and community college districts.

(E) Any authority, commission, board, agency, or instrumentality of any entity specified in paragraphs (1) to (3), inclusive.

(F) The University of California, the California State University, and community college districts.

(2) “Technological cessation in hiring” means the permanent ending of hiring or contracting for a particular occupation or position, caused in whole or in substantial part by the employer’s use of AI or other automation, regardless of either of the following:

(A) Whether any workers in that occupation or position remain employed or under contract.

(B) Whether the cessation results in an overall reduction in occupations or positions.

(3) “Worker” means any natural person who is an employee of, or an independent contractor providing service to, or through, a business or a state or local governmental entity in any workplace, for at least 6 months of the 12 months preceding the date on which notice is required under this article. “Worker” includes, but is not limited to, full-time and part-time workers but does not include a seasonally employed individual who was hired with the understanding that their employment is seasonal and temporary, a volunteer, or an intern.

(b) An employer shall provide a written technology hiring disruption notice containing all of the following information to the Employment Development Department when it executes a technological cessation in hiring:

(1) The name and address of the employment site and the name, email, and telephone number of a company official or public agency contact person.

(2) A statement indicating whether the planned action is permanent or temporary.

(3) The number of positions of the employer that were occupied at any point during the prior quarter for which the employer has decided not to fill because of a technological cessation in hiring.

(4) The classification or occupation, and work location of positions that will no longer be filled by workers due to the replacement or automation by AI.

(5) The job functions performed in these positions.

(6) The specific category or type of AI system or other automating technology that resulted in the technological cessation of hiring, including the entity or entities that developed, sold, or leased the product.

(7) A statement if the cessation resulted in hiring or creating other employment positions in the company and the number and occupation of those positions.

(c) The Employment Development Department shall do all of the following:

(1) Post summaries of the notices received pursuant to this Section on their internet website as part of the existing notice requirements of the Cal/WARN Act pursuant to this Chapter.

(2) Compile a quarterly summary using notices received pursuant to this Section to present a statewide summary of worker displacement due to AI and automation. The report shall include a link to the Cal/WARN Act notice report internet website.

(3) Submit the report to the labor and budget committees of the Assembly and Senate. The report submitted to the Legislature pursuant to this subdivision shall be submitted pursuant to Section 9795 of the Government Code.

1403. An employer who fails to give notice as required by paragraph (2) of subdivision (a) of Section 1401 or subdivision (b) of Section 1402.7 is subject to a civil penalty of not more than five hundred dollars ($500) for each day of the employer’s violation. The employer is not subject to a civil penalty under this section, however, if the employer pays to all applicable employees the amounts for which the employer is liable under Section 1402 within three weeks from the date the employer orders the mass layoff, relocation, or termination.

1406. (a) In any investigation or proceeding under this chapter, the Labor Commissioner has, in addition to all other powers granted by law, the authority to examine the books and records of an employer.

(b) The Labor Commissioner may enforce the notice requirements in Section 1401 and, subdivision (b) of Section 1402.7, and subdivision (a) of Section 1410, including investigating an alleged violation and ordering appropriate temporary relief to mitigate the violation pending the completion of a full investigation or hearing, through the procedures set forth in Section 98.3 or 1197.1, including by issuance of a citation against an employer who violates this chapter. If a citation is issued, the procedures for issuing, contesting, and enforcing judgments for citations and civil penalties issued by the commissioner shall be the same as those set forth in Section 1197.1, as appropriate.

ARGUMENTS IN SUPPORT:

A coalition of labor groups led by the California Federation of Labor Unions writes in support:

According to the Challenger Jobs Report that tracks workforce trends, 2023 was the first year that companies cited artificial intelligence as a reason for layoffs. Since then, AI was cited as the cause of close to 72,000 job cuts, with 55,000 AI-related layoffs in 2025 alone. Amazon, Dow Chemical, Accenture, Dell, Intel, Microsoft, TCS, UPS, and Citigroup all announced tens of thousands of AI-related job cuts in 2025. Salesforce laid off 4,000 customer support staff and froze hiring lawyers or software engineers, stating that AI now does up to 50% of the work of the company. In February 2026, CEO Jack Dorsey of Block and Square payments announced that he was laying off 4,000 workers, about 40% of the entire workforce, stating explicitly that the company would use AI to automate work.

Policy makers cannot ignore the blaring alarm bells warning of massive economic upheaval and worker suffering. AI poses an existential threat to human workers, government revenue, and society. The first step to tackling the growing threat is to collect and use reliable, local data to inform policy responses and to support workers who are the canaries in the coal mine of AI. This bill is a small, but crucial first step to that process.

SB 951 provides policy makers and the public with data on AI-related job loss. It requires employers to give advance notice to workers, local government, and the Employment Development Department (EDD) of AI-related layoffs or cessation in hiring for occupations. The notice is modeled on the WARN Act and updated for technological, rather than industrial, layoffs. Employers are also required to give workers facing layoffs the right to bid on existing positions in the company to mitigate the impact on incumbent workers. EDD will then collect and compile the data to provide legislators, researchers, and the public an overview of the impact of AI on jobs and hiring decisions. This data can be used with other sources from studies and developers for a more complete picture of the impact of AI on workers so the state, unions, and the public can respond.

ARGUMENTS IN OPPOSITION:

A coalition of trade associations led by the California Chamber of Commerce writes in opposition:

While we appreciate amendments the author has taken to more closely align with California’s current WARN Act (Cal-WARN), the bill's core structural problems remain unresolved. Furthermore, on May 21, 2026, Governor Newsom issued Executive Order N-6-26 which establishes a deliberate, evidence-based process for reviewing and updating California's existing workforce protection framework, including the WARN Act, in response to AI and automation. SB 951 would preempt this by imposing sweeping new statutory mandates before the review is complete.

REGISTERED SUPPORT / OPPOSITION:

Support

California Federation of Labor Unions, Afl-cio (Sponsor)
Alameda Labor Council
American Federation of Musicians, Local 7
American Federation of State, County and Municipal Employees, Afl-cio
California Alliance for Retired Americans (CARA)
California Employment Lawyers Association
California Faculty Association
California Federation of Teachers Afl-cio
California Nurses Association
California Rural Legal Assistance Foundation
California School Employees Association
California State Legislative Board of the Smart - Transportation Division
California Teachers Association
Center on Policy Initiatives
Central Coast Labor Council
Central Labor Council, Fresno-madera-tulare-kings Counties, Afl-cio
Communications Workers of America, District 9
Electronic Frontier Foundation
Inland Empire Labor Council, Afl-cio
Kapor Center Advocacy
North Bay Labor Council
North Valley Labor Federation
Orange County Labor Federation, Afl-cio
San Mateo County Central Labor Council
Service Employees International Union California
State Building and Construction Trades Council of California, Afl-cio
TechEquity Collaborative
What We Will

Oppose

Acclamation Insurance Management Services
Allied Managed Care
Associated General Contractors of California
Associated General Contractors San Diego
Calforests
California Apartment Association
California Bankers Association
California Chamber of Commerce
California Employment Law Council
California Farm Bureau
California Fuels and Convenience Alliance
California Grocers Association
California Hospital Association
California Landscape Contractor's Association
California League of Food Producers
California Manufacturers & Technology Association (CMTA)
California Restaurant Association
California Retailers Association
California's Credit Unions
Civil Justice Association of California (CJAC)
Flasher Barricade Association
Los Angeles Area Chamber of Commerce
Official Police Garages of Los Angeles
Shrm California
Silicon Valley Leadership Group (SVLG)
Technet
Tri County Chamber Alliance
Valley Industry and Commerce Association (VICA)
Western Growers Association

Oppose Unless Amended

Association of California Community College Administrators
Association of California Healthcare Districts (ACHD)
California Association of Recreation & Park Districts
California Special Districts Association
California State Association of Counties (CSAC)
Chamber of Progress
League of California Cities
Nevada County Board of Supervisors
Public Risk Innovation, Solutions, and Management (PRISM)
Rural County Representatives of California (RCRC)
University of California
Urban Counties of California (UCC)

Analysis Prepared by: Slater Sharp / P. & C.P. / (916) 319-2200

1. Government Code section 11546.45.5(a)(1) defines an ADS as “a computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including a score, classification, or recommendation, that is used to assist or replace human discretionary decisionmaking and materially impacts natural persons.” ↑

2. See e.g. Santariano & Metz, “Using A.I. to Detect Breast Cancer That Doctors Miss,” New York Times (Mar. 5, 2023), https://www.nytimes.com/2023/03/05/technology/artificial-intelligence-breast-cancer-detection.html. ↑

3. Challenger, Gray & Christmas, “Challenger Report December 2025,” (Jan. 8, 2026), https://www.challengergray.com/wp-content/uploads/2026/01/Challenger-Report-December-2025.pdf. ↑

4. Resume.org, “The Great Turnover: 9 in 10 Companies Plan To Hire in 2026, Yet 6 in 10 Will Have Layoffs,” https://www.resume.org/the-great-turnover-9-in-10-companies-plan-to-hire-in-2026-yet-6-in-10-will-have-layoffs-2. ↑

5. Salari, Beiromvand, Hosseinian-Far, Habibi, Babajani, and Mohammadi, “Impacts of generative artificial intelligence on the future of labor market: A systematic review,” Computers in Human Behavior Reports, (Mar. 15, 2025), https://www.sciencedirect.com/science/article/pii/S2451958825000673. ↑

6. Jeannine Mancini, “Ford CEO Says AI Will Replace 'Literally Half' of White-Collar Workers — But Blue-Collar Trades Are Still The Essential Backbone Of The Economy,” yahoo!finance, (Oct. 6, 2025), https://finance.yahoo.com/news/ford-ceo-says-ai-replace-203114506.html. ↑

7. Jim VandeHei and Mike Allen, “Behind the Curtain: A white-collar bloodbath,” Axios, (May 28, 2025), https://www.axios.com/2025/05/28/ai-jobs-white-collar-unemployment-anthropic. ↑

8. Ashton Jackson, “Nvidia CEO: You won’t lose your job to AI—you’ll ‘lose your job to somebody who uses AI’,” CNBC, (May 28, 2025), https://www.cnbc.com/2025/05/28/nvidia-ceo-jensen-huang-youll-lose-your-job-to-somebody-who-uses-ai.html. ↑

9. Anthropic, “Anthropic Economic Index,” https://www.anthropic.com/economic-index#state-usage. ↑

10. Otis College of Art and Design, Otis College Update on the Creative Economy, (Mar. 27, 2025), available at

    https://www.otis.edu/about/initiatives/documents/25-063-CreativeEconomy_Report4_250325.pdf. ↑

11. Otis College of Art and Design, Otis College Report on the Creative Economy, (2023), available at

    https://www.televisionacademy.com/files/assets/Downloads/2023-otis-report-on-the-creative-economy-v1.pdf. ↑

12. PMP Strategy/CISAC, Study on the economic impact of Generative AI in the Music and Audiovisual industries,

    (Nov. 2024), available at https://www.cisac.org/services/reports-and-research/cisacpmp-strategy-ai-study. ↑

13. Katie Paul, Jeff Horwitz, and Deepa Seetharaman. “Exclusive: Meta planning sweeping layoffs as AI costs mount,” Reuters, (Mar. 13, 2026), https://www.reuters.com/business/world-at-work/meta-planning-sweeping-layoffs-ai-costs-mount-2026-03-14/. ↑

14. Jon Markman, “Oracle’s Massive 30,000 Layoff As AI Spending Surges,” Forbes, (Apr. 6, 2026), https://www.forbes.com/sites/jonmarkman/2026/04/06/oracles-massive-30000-layoff-as-ai-spending-surges/. ↑

15. Jordan Vallnsky, “Amazon is laying off 16,000 employees as AI battle intensifies,” CNN, (Jan. 28, 2026), https://www.cnn.com/2026/01/28/tech/amazon-layoffs-ai. ↑

16. Jack Dorsey, X, (Feb. 26, 2026), https://x.com/jack/status/2027129697092731343. ↑

17. The White House, Blueprint for an AI Bill of Rights, (Oct. 2022), p. 14, https://bidenwhitehouse.archives.gov/ostp/ai-bill-of-rights/ (Blueprint). Despite the use of the term “AI” in its title, the Blueprint focuses on ADS. ↑

18. Jeremy White, “‘The whole system has to be reimagined’ — Newsom calls for rethinking economy amid AI boom”, Politico, (May 19, 2026), https://www.politico.com/news/2026/05/19/gavin-newsom-cap-economy-ai-boom-00927930 ↑

19. “Governor Newsom signs first-of-its-kind executive order to prepare workers and businesses for potential AI disruption”, (May 21, 2026), https://www.gov.ca.gov/2026/05/21/governor-newsom-signs-first-of-its-kind-executive-order-to-prepare-workers-and-businesses-for-potential-ai-disruption/ ↑

Date of Hearing: June 10, 2026

ASSEMBLY COMMITTEE ON LABOR AND EMPLOYMENT

Liz Ortega, Chair

SBPCA Bill Id:SB 951

Author:(Reyes) – As Amended Ver:May 14, 2026

SENATE VOTE: 28-9

SUBJECT: Employment: technological displacement: notice

SUMMARY: Requires an employer to provide at least a 60-day advanced written notice before any technological displacement, as defined, of 25 or more workers during any 30-day period. Additionally requires an employer to provide to the Employment Development Department (EDD) a written technology hiring disruption notice when it executes a technological cessation in hiring caused in whole by the adoption of AI or other automating technology. Authorizes enforcement of these provisions by the Labor Commissioner (LC) or a court of law. Specifically, this bill:

1. Defines “artificial intelligence” or “AI” to mean an engineered or machine-based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.
2. Defines “employer” to mean any individual who, or entity that, directly or indirectly, or through an agent or any other person, employs or exercises control over the wages, benefits, other compensation, hours, working conditions, access to work or job opportunities, or other terms or conditions of employment, of any worker. An “employer” includes, but is not limited to, any of the following:
   1. The state, including its legislative, judicial, and executive branches.
   2. Any city, county, or city and county, including any charter city, charter county, charter city and county, and other political subdivisions of the state.
   3. Special districts.
   4. Local educational agencies (“LEAs”) that do not provide layoff notices, as specified, for classified and certificated staff.
   5. Any authority, commission, board, agency, or instrumentality of any entity specified in

paragraphs (a)-(c) above.

• 1. The University of California, the California State University, and community college districts.

1. Defines “technological displacement” to mean the elimination of employment positions resulting in layoffs within any 12-month period, caused in whole by an AI system or other automated technology replacing or automating employment positions.
2. Defines “technological cessation in hiring” to mean the end of hiring permanently for an occupation or position that is caused in whole by the use of AI or other automation. “Technological cessation in hiring” does not mean an overall reduction in employment positions.
3. Defines “worker” to mean an individual employed or contracted by an employer for at least 6 months of the 12 months preceding the date on which notice is required under 6) below. “Worker” includes, but is not limited to, full-time and part-time workers and independent contractors, but does not include a seasonally employed individual who was hired with the understanding that their employment is seasonal and temporary, a volunteer, or an intern.
4. Requires an employer to provide at least a 60-day advanced written notice before any technological displacement affecting 25 or more workers during any 30-day period.
5. Requires the notice to be provided to both of the following:
   1. The workers of the employer affected by the order.
   2. The Employment Development Department (EDD), the local workforce investment board, and the city council members and county board of supervisors of each city and county in the state within which the technological displacement occurs.
6. Requires the notice to contain all of the following information:
   1. The name and address of the employment site and the name, email, and telephone number of a company official or public agency contact person.
   2. A statement indicating whether the planned action is permanent or temporary.
   3. The expected date of the first separation and the anticipated schedule for subsequent separations.
   4. The number, classification, and work location of layoffs that are substantially due to the replacement or automation by AI.
   5. The job functions performed by those workers that will be automated by AI.
   6. The specific category or type of AI system or other automating technology that substantially resulted in technological displacement, including the entity or entities that developed, sold, or leased the product.
   7. The justification for, and purpose of, the use of the AI tool.
   8. If retraining is available to current workers to transition from eliminated occupations to new ones at the company.
   9. Whether the employer plans to coordinate services, such as a rapid response orientation, through the local workforce development board, a different entity, or the employer does not plan to coordinate services with any entity.
7. Regardless of whether the employer chooses to coordinate services with the local workforce development board or another entity, the employer shall include in the notice a functioning email and telephone number of the board and a description of the rapid response activities offered by the local workforce development board, as specified.
8. If the employer chooses to coordinate services with the local workforce development board or another entity, the employer shall arrange services within 30 days from the date of the notice.
9. Requires, for employers with more than 100 workers, each worker affected by a technological displacement to be entitled to the right of first bid on other positions with the employer. This provision shall not apply to the extent it would conflict with the provisions of a collective bargaining agreement.
10. Prohibits an employer from discharging a worker affected by the technological displacement without reasonable and substantiated cause during the 60-day period from when the notice in 6) above is provided to the worker.
11. Requires an employer to provide a written technology hiring disruption notice when it executes a technological cessation in hiring caused in whole by the adoption of AI or other automating technology. The notice shall be given to the EDD.
12. Requires the notice to include all of the following information:
    1. The name and address of the employment site and the name, email, and telephone number of a company official or public agency contact person.
    2. A statement indicating whether the planned action is permanent or temporary.
    3. The number of positions of the employer that were occupied at any point during the prior quarter for which the employer has decided not to fill because of a technological cessation in hiring.
    4. The occupational classification and work location of positions that will no longer be filled by humans due to the replacement or automation by AI.
    5. The job functions performed in these positions.
    6. The specific category of type of AI system or other automating technology that resulted in the technological cessation of hiring, including the entity or entities that developed, sold, or leased the product.
    7. The justification for and purpose of the use of the AI tool.
    8. A statement if the cessation resulted in hiring or creation of other employment positions in the company and the number and occupation of those positions.
13. Authorizes, if an employer meets the requirement to provide a notice pursuant to the California Worker Adjustment and Retraining Notification (Cal/WARN) Act, the employer to include the requirements for the technological displacement and technological cessation notices in hiring in one document to all workers, regardless of the type of layoff.
14. Requires a LEA that provides layoff notices pursuant to the Education Code, as specified, for classified and certificated staff, to provide the EDD a written technology displacement or cessation in hiring notice when it executes a technological displacement or a technological cessation in hiring caused in whole by the adoption of AI or other automating technology. The notice shall be provided on an annual basis and include the information required pursuant to 8) (a)-(h) above.
15. Requires the EDD to post notices received pursuant to 6) and 11) above on their internet website and compile a quarterly summary to present a statewide summary of worker displacement due to AI and automation. The report shall include a link to a public database of individual notices received from employers.
16. Requires the EDD to submit the report to the labor and budget committees of the Assembly and Senate, as specified.
17. Provides that an employer that fails to give notice as required by 7) a) above before ordering a technological displacement is liable to each worker entitled to notice who lost their employment. The employer shall be liable for all of the following for each worker:
18. Back pay at the average regular rate of compensation received by the worker during the last three years of their employment, or the worker’s final rate of compensation, whichever is higher.
19. The value of the cost of any benefits to which the worker would have been entitled had their employment not been lost, including the cost of any medical expenses incurred by the worker that would have been covered under a worker benefit plan.
20. Provides that liability under 17) above shall be calculated for the entire period of the employer’s violation up to a maximum of 60 days, or one-half the number of days that the worker was employed, whichever period is shorter.
21. Requires the amount of an employer’s liability under 17) above to be reduced by all of the following:
    1. Any wages paid by the employer to the worker during the period of the employer’s violation. For purposes of this paragraph, “wages” shall exclude payment equivalent to leave or vacation hours accrued before the period of the employer’s violation.
    2. Any voluntary and unconditional payments made by the employer to the worker that were not required to satisfy any legal obligation.
    3. Any payments by the employer to a third party or trustee, such as premiums for health benefits or payments to a defined contribution pension plan, on behalf of and attributable to the worker for the period of the violation.
22. States that an employer that fails to provide notice as required by 7) a) above shall also be subject to a civil penalty of not more than five hundred dollars ($500) for each day of the employer’s violation. However, the employer shall not be subject to a civil penalty under this section if the employer pays to all applicable workers the amounts for which the employer is liable pursuant to 17) above within three weeks from the date the employer orders the technological displacement. The civil penalty shall be recoverable by the LC.
23. Authorizes any person, including any third or uninterested parties, to report to the LC that an employer has failed to comply with the notice requirements. Any such person shall provide documentation to substantiate their allegations, including, but not limited to, public statements by employer officials, United States Securities and Exchange Commission filings, and shareholder reports, before the LC considers the report.
24. Permits a person, including a local government or a worker representative, seeking to establish liability against an employer to bring a civil action on behalf of the person, other persons similarly situated, or both, in any court of competent jurisdiction. The court may award reasonable attorney’s fees and costs to any prevailing plaintiff.
25. States that if the court determines that an employer conducted a reasonable investigation in good faith and had reasonable grounds to believe that its conduct was not a violation of this article, the court may reduce the amount of any penalty imposed against the employer.
26. Provides that in any investigation or proceeding under this article, the LC has, in addition to all other powers granted by law, the authority to examine the books and records of an employer.
27. Authorizes the LC to enforce 24) above and the notice requirements for technological displacement through the procedures set forth in Labor Code Section 98.3 or 1197.1, including, but not limited to, by investigating an alleged violation, ordering appropriate temporary relief to mitigate the violation pending the completion of a full investigation or hearing, and issuing a citation against an employer that violates this article. If a citation is issued, the procedures for issuing, contesting, and enforcing judgments for citations and civil penalties issued by the commissioner shall be the same as those set forth in Labor Code Section 1197.1, as appropriate.
28. Establishes the Technological Displacement Act Fund within the State Treasury. Notwithstanding any law, all civil penalties recovered by the LC pursuant to this article shall be deposited in the fund.
29. Requires all moneys in the fund to be available to the commissioner, upon appropriation by the Legislature, for purposes of enforcing these provisions.
30. States that the provisions of this article do not supersede greater protections that may be provided by a collective bargaining agreement.
31. States that the provisions of this article are severable.

EXISTING LAW:

EXISTING FEDERAL LAW

1. Establishes the Worker Adjustment and Retraining Notification “WARN” Act, prohibiting certain employers from ordering a plant closing or mass layoff until the end of a 60-day period after the employer serves written notice of such an order, and requires certain information to be contained in the notice. 29 U.S.C. Sec 2101 et seq.; 20 CFR Part 639.
2. Defines “rapid response activity” to mean an activity provided by a State, or by an entity designated by a State, in the case of a permanent closure or mass layoff at a plant, facility, or enterprise, or a natural or other disaster, that results in mass job dislocation, in order to assist dislocated workers in obtaining reemployment as soon as possible, with services including:
   1. The establishment of onsite contact with employers and employee representatives, as specified.
   2. The provision of information on and access to available employment and training activities;
   3. Assistance in establishing a labor-management committee, as specified.
   4. The provision of emergency assistance adapted to the particular closure, layoff, or disaster; and
   5. The provision of assistance to the local community in developing a coordinated response and in obtaining access to State economic development assistance. 29 U.S.C. § 3102(51).
3. Requires states to use funds reserved for rapid response activities to carry out statewide rapid response activities, including the provision of additional assistance to local areas that experience disasters, mass layoffs, or plant closings. 29 U.S.C. § 3174(c)(2).

EXISTING STATE LAW

1. Establishes the Cal/WARN Act, governing mass layoffs, relocations and terminations. Labor Code § 1400 et seq
2. Prohibits an employer, with certain exceptions, from ordering a mass layoff, relocation, or termination at a covered establishment, as defined, without giving prescribed written notice to employees, the EDD, and other local agencies at least 60 days before the order takes effect. Labor Code § 1401(a).
3. Defines “mass layoffs” to mean a layoff during any 30-day period of 50 or more employees at a covered establishment. Labor Code § 1400.5(d).
4. Defines “relocation” to mean the removal of all or substantially all of the industrial or commercial operations in a covered establishment to a different location 100 miles or more away. Labor Code § 1400.5(e).
5. Defines “termination” to mean the cessation or substantial cessation of industrial or commercial operations in a covered establishment. Labor Code § 1400.5(f).
6. Defines “employer” to mean any person who directly or indirectly owns and operates a covered establishment and provides that a parent corporation is an employer as to any covered establishment directly owned and operated by its corporate subsidiary. Labor Code § 1400.5(b).
7. Defines “covered establishment” to mean any industrial or commercial facility or part thereof that employs, or has employed within the preceding 12 months, 75 or more persons. Labor Code § 1400.5(a).
8. Requires the notice referenced in 2) above to include the elements required by the federal WARN Act. Labor Code § 1401(b).
9. Provides that an employer that fails to give the required notice, as required by Cal/WARN, before ordering a mass layoff, relocation, or termination, is liable to each employee entitled to notice, for specified compensation and benefits, calculated for the period of the employer’s violation, up to a maximum of 60 days, or half the number of days that the employee was employed by the employer, whichever period is shorter. Labor Code § 1402.
10. Subjects an employer who fails to give proper notice under Cal/WARN to a civil penalty of not more than $500 for each day of the employer’s violation, but provides that the employer is not subject to this civil penalty if the employer pays to all applicable employees the amounts for which the employer is liable under 9) above within three weeks from the date the employer orders the mass layoff, relocation, or termination. Labor Code § 1403.

FISCAL EFFECT: According to the Senate Appropriations Committee,

• The Employment Development Department (EDD) indicates that it would incur one-time General Fund costs of $1.8 million, and $400,000 (minimally) annually thereafter, to implement the provisions of the bill. Additionally, the department notes that the required information technology changes could make the bill’s effective date of January 1, 2027 operationally infeasible.
• The Department of Industrial Relations (DIR) is still reviewing the bill but expects that costs will exceed $300,000 annually for staff (enforcement deputies, support, and supervisory staff) to enforce (1) the technological displacement (WARN like) notice and (2) other requirements.
• This bill could result in increased penalty revenue to the State. The magnitude is unknown.

COMMENTS: Note: This bill is double-referred to the Assembly Privacy and Consumer

Protection Committee upon passage from this committee.

This bill builds upon the Cal/WARN Act that governs mass layoffs and relocation or termination

of operations at private establishments in California by creating notice requirements for layoffs

or permanent hiring freezes due to AI or other automation. SB 951 applies its provisions more

broadly to include workers in the public sector, workers of smaller businesses or public entities,

and independent contractors.

Companies are adopting AI and automating technologies at a frenetic pace resulting in both

notable layoffs and the slowing of job placements. According to an “AI layoffs” tracker by

Founder Reports, 80% of organizations piloting or deploying autonomous business technology

have reduced their workforce in 2026.^[1] For example, IBM eliminated “200 HR roles after its

agentic “AskHR” system automated high-volume workflows such as routine employee inquiries

and administrative document processing.^[2]” Similarly, Salesforce cut some 4,000 customer

service jobs after deploying AI agents to handle half of customer interactions.^[3] Additionally, in

April of this year, large-scale job cuts were especially prevalent in the tech sector, which is

leading all industries in layoff announcements while citing AI spending as a major contributor.^[4]

Researchers also report that AI is causing a slowdown in hiring in the broader market. They’ve

even created a term for it—a “big freeze”—as hiring levels have dipped to 2010 levels.^[5] Another

indicator of hiring stagnation is a rise in unemployment among recent college graduates. For this

demographic, “unemployment has climbed to almost 6%, rising twice as fast as the rest of the

workforce since 2022.^[6]”

On May 21, 2026, Governor Newsom announced an executive order (EO) on AI and the

workforce.^[7] The EO requires, among other things, a review of academic research identifying the

potential workforce impacts of technological shifts, including AI’s impact on California’s labor

market. Specifically, the EO orders the Labor Workforce and Development Agency within six

months to review and provide recommendations on revisions and updates to Cal/WARN so that

it is responsive to emerging industry trends. In conjunction with this effort, the EDD is tasked

with launching a dashboard of AI’s impacts on employment across various sectors using

unemployment insurance data. It is unclear how the EO would affect implementation of this bill

if signed into law.

According to the author, “Artificial Intelligence is transforming our economy at an unprecedented pace. Unlike past technological advances, AI has the ability to automate entire occupations almost overnight, leaving workers vulnerable to sudden economic disruption. Employers are already citing AI as a reason for layoffs and hiring freezes, yet policymakers lack reliable data to understand the full impact. Without this information, government is forced to respond only after workers have already lost their livelihoods.

SB 951 modernizes California’s existing Worker Adjustment and Retraining Notification Act by requiring employers to provide a 60-day advance notice when mass layoffs are driven by artificial intelligence or technological automation. This ensures workers and the state have time to prepare and respond, while also allowing the state to collect critical data on AI-related job loss and workforce disruption. This information will help policymakers better understand how AI is reshaping our labor market and craft informed, proactive solutions.

Innovation should not come at the expense of working families. SB 951 ensures transparency, preparedness, and accountability as artificial intelligence becomes a permanent part of California’s economy.”

The author continues, “Throughout history, major technological shifts have transformed our economy. While innovation has created opportunity, it has also left many working class people behind, often with deep and lasting economic scars. Unlike past technological shifts, however, automation and artificial intelligence (AI) have widened the scope of automatable tasks beyond manufacturing to other industries. For instance, warehouse workers use digital order-picking and shipment tools; aerospace workers use augmented reality to improve efficiency on the assembly line; and agricultural workers use in-cab systems for efficient tractor operation. Meaning, this technological shift has the potential to disrupt all sectors but especially those in underserved and marginalized communities. According to a UCLA Latino Policy and Politics Institute report, Latino and Black workers are heavily employed in the jobs most susceptible to automation. SB 951 will ensure that innovation does not come at the expense of workers, especially those in underserved and marginalized communities and allows the state to collect critical data on AI-related job loss and workforce disruption.”

Committee Comments

Committee staff recommend the author amend the bill in the future to provide a threshold on how many positions the employer must no longer be permanently hiring for to trigger the “technological cessation in hiring” notice under proposed Labor Code Section 1414.3(a).

Arguments in Support

The California Federation of Labor Unions, sponsor of the bill, states, “Policy makers cannot ignore the blaring alarm bells warning of massive economic upheaval and worker suffering. AI poses an existential threat to human workers, government revenue, and society. The first step to tackling the growing threat is to collect and use reliable, local data to inform policy responses and to support workers who are the canaries in the coal mine of AI. This bill is a small, but crucial first step to that process.

SB 951 provides policy makers and the public with data on AI-related job loss. It requires employers to give 60-days advance notice to workers, local government, and the Employment Development Department (EDD) of AI-related layoffs or cessation in hiring for occupations and the notice may be integrated with existing WARN notices. Employers are also required to give workers facing layoffs the right to bid on existing positions in the company to mitigate the impact on incumbent workers. This advance notice gives workers and their communities time to prepare for potentially extended unemployment.

EDD will then collect and post the data to provide legislators, researchers, and the public an overview of the impact of AI on jobs and hiring decisions. This data can be used with other sources from studies and developers for a more complete picture of the impact of AI on workers so the state, unions, and the public can shape a response that is targeted, appropriate, and based on real world information rather than speculation and media reports.”

Arguments in Opposition

A coalition of employer organizations, including the California Chamber of Commerce, are opposed and state, “while we appreciate the amendments the author has taken to reduce the advance notice period from 90 to 60 days and narrow the definition of 'technological cessation in hiring' to require that AI be the cause 'in whole' (rather than 'directly and primarily'), they are modest improvements that do not cure the bill's fundamental defects:

1. Overbroad trigger threshold remains. The bill still applies to any technological displacement affecting 25 or more workers during any 30-day period, a threshold far lower than Cal-WARN’s 50-employee trigger for mass layoffs.
2. Independent contractors are not employees. Independent contractors with at least six months of tenure are still covered, sweeping in contingent workers categorically different from permanent employees.
3. Mandatory disclosure of proprietary information is unchanged. The bill still requires employers to publicly disclose the specific AI system used, the identity of the technology vendor, job functions automated, and the justification for the technology adoption. These requirements compel disclosure of trade secrets, vendor relationships, and internal business strategy. This information is wholly unrelated to actual job loss and potentially harmful to California's competitive environment. Notably, Cal-WARN imposes no obligation on employers to disclose financial records, projections, or budgetary justifications when effectuating a layoff purportedly driven by economic conditions...”

A coalition of local government employers, including the Rural County Representatives of California, is opposed unless amended, and seeks to be exempt from the bill. The coalition states, “SB 951's requirement that certain employers, including many public agencies, provide displaced workers with a "right of first bid" on other positions would directly conflict with long-established merit-based civil service systems and collectively bargained labor agreements that govern vast majority public-sector hiring. These systems prescribe detailed procedures for filling vacancies, including competitive examinations, minimum qualifications, seniority provisions, reemployment lists, promotional opportunities, and negotiated bumping and layoff rights. By creating a new statutory hiring preference that supersedes these established processes, SB 951 would create significant legal uncertainty and expose public employers to competing obligations under state labor laws, civil service rules, and local personnel ordinances.

1. While the recent amendments attempt to address collective bargaining concerns by exempting situations where the right-of-first-bid provisions would conflict with a collective bargaining agreement, the amendment does not resolve the fundamental problems created by the bill. Instead, it introduces significant legal uncertainty by requiring employers, employee organizations, and ultimately the courts to determine when a conflict exists and whether a particular negotiated provision is sufficient to displace the statutory requirements.”

Related and Prior Legislation

SB 947 (McNerney) of 2026 would, among other things, 1) prohibit an employer from using an ADS that does certain functions and would limit the purposes and manner in which an ADS may be used to make disciplinary, termination, or deactivation decisions; 2) require an employer to provide a written postuse notice when an employer has used an ADS, as specified; 3) include worker anti-retaliation provisions for exercising these rights; and 4) specify enforcement provisions including specified penalties and relief for violations. SB 947 is pending in this committee.

AB 1883 (Bryan) of 2026 would regulate the use of workplace surveillance tools and an employer’s use of worker data. The bill would require the LC to enforce the bill’s provisions, would authorize an employee to bring a civil action for specified remedies for a violation, and would authorize a public prosecutor to also enforce. AB 1883 is pending referral in the Senate.

AB 1898 (Schultz) of 2026 would require an employer to provide a written notice to an employee that a workplace AI tool, as defined, was used to assist the employer in making employment-related decisions or to surveil workers in the workplace. The bill would require an employer to maintain an updated list of all workplace AI tools currently in use and their impact on jobs, as specified, and to provide the list to workers annually. The bill would provide for enforcement by the LC or a public prosecutor, and alternatively would authorize any worker who has suffered damages, or their exclusive representative, to file a civil action for damages caused by the adverse action. The bill would establish remedies and penalties for violations. This bill was held in the Assembly Appropriations Committee.

AB 1979 (Bonta) of 2026 would, among other things, require a health facility, clinic, physician’s office, or office of a group practice to ensure that no clinical decision is based solely on the output of a clinical decision support system. AB 1979 is pending in the Senate Privacy, Digital Technologies, and Consumer Protection Committee.

AB 2027 (Ward) of 2026 would, among other things, prohibit an employer or vendor from using a worker’s data to train or deploy AI to, among other things, replicate, automate, or replace a worker’s job, and to prohibit an employer or vendor from deploying AI trained with worker data to replicate, automate, or replace a worker’s job. This bill was held in the Assembly Appropriations Committee.

AB 2148 (Muratsuchi) of 2026 clarifies that, for purposes of the Education Code, public school employees and contractors performing services in public schools must be natural persons, thereby affirming that interactions between students and school personnel are to be conducted by human beings rather than artificial intelligence (AI) systems. AB 2148 is pending in the Assembly Education Committee.

AB 2530 (Caloza) of 2026 would add public agencies to coverage under the Cal/WARN Act for the purpose of an employer giving notice regarding a mass layoff, relocation, or termination. This bill was held in the Assembly Appropriations Committee.

SB 617 (Arreguin) Chapter 229, Statutes of 2025 expanded the information employers are required to include in a Cal/WARN notice and requires employers that choose to coordinate services through a local workforce development board or another entity to do so within 30 days of the notice.

AB 1356 (Haney) of 2023 would have, among other things, revised the Cal/WARN Act to increase the notice requirement from 60 to 90 days prior to a mass layoff and modified the definition of “covered establishment.” The bill was vetoed by Governor Newsom.

REGISTERED SUPPORT / OPPOSITION:

Support

California Federation of Labor Unions, AFL-CIO (Sponsor)
Alameda Labor Council
American Federation of Musicians, Local 7
American Federation of State, County and Municipal Employees California
American Federation of State, County and Municipal Employees, AFL-CIO
California Alliance for Retired Americans 
California Employment Lawyers Association
California Faculty Association
California Federation of Teachers AFL-CIO
California Nurses Association
California School Employees Association
California State Legislative Board of the Smart - Transportation Division
Center on Policy Initiatives
Central Coast Labor Council
Central Labor Council, Fresno-madera-tulare-kings Counties, AFL-CIO
Communications Workers of America, District 9
Electronic Frontier Foundation
Inland Empire Labor Council, AFL-CIO
Kapor Center Advocacy
North Bay Labor Council
North Valley Labor Federation
Orange County Labor Federation, AFL-CIO
San Mateo County Central Labor Council
Service Employees International Union California
State Building and Construction Trades Council of California, AFL-CIO
Techequity Collaborative
What We Will

Opposition

Acclamation Insurance Management Services
Allied Managed Care
Associated General Contractors of California
Associated General Contractors San Diego
Calforests
California Apartment Association
California Bankers Association
California Chamber of Commerce
California Employment Law Council
California Farm Bureau
California Fuels and Convenience Alliance
California Grocers Association
California Hospital Association
California Landscape Contractors Association
California League of Food Producers
California Manufacturers & Technology Association 
California Manufacturers and Technology Association
California Restaurant Association
California Retailers Association
California's Credit Unions
Civil Justice Association of California 
Flasher Barricade Association
Los Angeles Area Chamber of Commerce
Official Police Garages of Los Angeles
Society for Human Resource Management California
Technet
Western Growers Association

Oppose Unless Amended

Association of California Healthcare Districts 
California Association of Recreation & Park Districts
California Special Districts Association
California State Association of Counties 
Chamber of Progress
Community College League of California
League of California Cities
Public Risk Innovation, Solutions, and Management 
Rural County Representatives of California 
University of California
Urban Counties of California

Analysis Prepared by: Megan Lane / L. & E. / (916) 319-2091

1. Founder Reports: AI Layoffs by Company: A Tracker of Every Major Layoff Tied to AI (2026). Marc

   Shorb, May 24, 2026. ↑

2. Sonnenfeld, Jeffrey A., “The Real Job Destruction from AI is Hitting Before Careers Can Start.” Yale Insights. May 4, 2026. ↑

3. Ibid. ↑

4. Challenger Report: Volatility Continues: Job Cuts up 38%; AI Leads Reasons for Second Consecutive Month. May 7, 2026. ↑

5. Sonnenfeld, Jeffrey A., “The Real Job Destruction from AI is Hitting Before Careers Can Start.” Yale Insights. May 4, 2026. ↑

6. Ibid. ↑

7. Executive Order N-6-26. Accessed at: 5.21.26-AI-Workforce-EO-FINAL-SIGNED.pdf. ↑

 THIRD READING  

Bill No: SB 951

Author: Reyes (D)

Amended: 5/14/26

Vote: 21

SENATE LABOR, PUB. EMP. & RET. COMMITTEE: 3-1, 4/8/26

AYES: Smallwood-Cuevas, Cortese, Durazo

NOES: Strickland

NO VOTE RECORDED: Laird

SENATE PRIV., DIGITAL TECH. & CONS. PROT. COMMITTEE: 7-2, 4/20/26

AYES: Cabaldon, Gonzalez, McNerney, Padilla, Reyes, Umberg, Wiener

NOES: Jones, Seyarto

SENATE APPROPRIATIONS COMMITTEE: 5-2, 5/14/26

AYES: Cervantes, Cabaldon, Grayson, Richardson, Wahab

NOES: Seyarto, Dahle

SUBJECT: Employment: technological displacement: notice

SOURCE: California Federation of Labor Unions

DIGEST:

This bill establishes the California Worker Technological Displacement Act to, among other things, 1) require employers to provide a 60-day advanced written notice before any technological displacement affecting a specified number of its workforce; 2) prohibit employers from discharging an affected worker without reasonable and substantiated cause during this 60-day period; 3) grant impacted workers the right of first bid on other positions with the employer; and 4) prescribe penalties and specified remedies for violations, including the filing of a civil action.

ANALYSIS:

Existing federal law:

1. Establishes the federal Worker Adjustment and Retraining Notification (WARN) Act prohibiting an employer with 100 or more full-time employees, as specified, from ordering a plant closure or mass layoff until the end of a 60-day period after the employer serves written notice of such an order to:
   1. Each representative of the affected employees as of the time of the notice or, if there is no such representative at that time, to each affected employee; and
   2. The State or entity designated by the State to carry out rapid response activities, as specified, and the chief elected official of the unit of local government within which such closing or layoff is to occur.

(29 United States Code (U.S.C.) §§2101)

1. Makes an employer who violates the federal WARN provisions liable to each employee for an amount equal to back pay and benefits for the period of the violation, up to 60 days, but no more than half the number of days the employee was employed by the employer. (29 U.S.C. §§2104)

Existing state law:

1. Establishes the California Worker Adjustment and Retraining Act (Cal-WARN), which prohibits an employer with 75 or more full and part-time employees from ordering a mass layoff (of 50 or more employees within a 30-day period), relocation, or termination at a covered establishment, as defined, unless, 60 days before the order takes effect, the employer gives written notice to all of the following:
   1. The employees of the covered establishment affected by the order.
   2. The Employment Development Department, the local workforce investment board, and the chief elected official of each city and county government within which the termination, relocation, or mass layoff occurs.

(Labor Code §1400-1413)

1. Exempts, from the provisions of Cal-WARN, seasonal employees and employees that are laid off as a result of the completion of a project in specified industries, where the employers are subject to specified wage orders, and the employees were hired with the understanding that their employment was seasonal and temporary. (Labor Code §1400.5.)
2. Requires employers mandated to give notice of any mass layoff, relocation, or termination pursuant to Cal-WARN to include in its notice, the elements required by the federal WARN Act. (Labor Code §1401)
3. Makes an employer that fails to give the required Cal-WARN notice before ordering a mass layoff, relocation, or termination liable to each employee entitled to notice, for specified back pay and medical expenses incurred that would have been covered under an employee benefit plan, calculated for the period of the employer’s violation, up to a maximum of 60 days, or half the number of days that the employee was employed by the employer, whichever period is shorter. (Labor Code §1402)
4. Subjects an employer who fails to give the required Cal-WARN notice to a civil penalty of not more than five hundred dollars ($500) for each day of the employer’s violation. Exempts an employer from this civil penalty if the employer pays all applicable employees within three weeks from the date the employer ordered the mass layoff, relocation, or termination. (Labor Code §1403)
5. Permits a person, including a local government, or an employee representative, seeking to establish liability against an employer for violation of Cal-WARN to bring a civil action on behalf of the person other persons similarly situated, or both, in any court of competent jurisdiction. Additionally, permits a court to award reasonable attorney’s fees as part of the costs to any plaintiff who prevails in a civil action. (Labor Code §1404)
6. Defines “artificial intelligence” (AI) to mean an engineered or machine-based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments. (Government Code §11546.45.5)
7. Establishes within the Department of Industrial Relations (DIR), various entities including the Division of Labor Standards Enforcement (DLSE) under the direction of the Labor Commissioner (LC), and empowers the LC with ensuring a just day’s pay in every workplace and promotes economic justice through robust enforcement of labor laws. (Labor Code §79-107)
8. Establishes the Employment Development Department (EDD) and vests it with various duties and responsibilities including job creation activities, administration of the Unemployment, Disability, and Paid Family Leave programs, collection of payroll taxes, keeping track of employment records, managing federal job training programs, and collecting and sharing information about the job market. (Unemployment Insurance Code §301)

This bill:

1. Defines, among others, the following terms:
   1. “Employer” means any individual who, or entity that, directly or indirectly, or through an agent or any other person, employs or exercises control over the wages, benefits, other compensation, hours, working conditions, access to work or job opportunities, or other terms or conditions of employment, of any worker. An “employer” includes, but is not limited to, any of the following:
      1. The state, including its legislative, judicial, and executive branches.
      2. Any city, county, or city and county, including any charter city, charter county, charter city and county, and other political subdivisions of the state.
      3. Special districts.
      4. Local educational agencies that do not provide layoff notices pursuant to Section 45117 and 44955 of the Education Code for classified and certificated staff.
      5. Any authority, commission, board, agency, or instrumentality of any entity specified in paragraphs (1) to (3), inclusive.
      6. The University of California, the California State University, and community college districts.
   2. “Technological displacement” means the elimination of employment positions resulting in layoffs within any 12-month period, caused in whole by an artificial intelligence (AI) system or other automated technology replacing or automating employment positions.
   3. “Technological cessation in hiring” means the end of hiring permanently for an occupation or position that is caused in whole by the use of AI or other automation. “Technological cessation in hiring” does not mean an overall reduction in employment positions.
   4. “Worker” means an individual employed or contracted by an employer for at least 6 months of the 12 months preceding the date on which notice is required under this article. “Worker” includes, but is not limited to, full-time and part-time workers and independent contractors, but does not include a seasonally employed individual who was hired with the understanding that their employment is seasonal and temporary, a volunteer, or an intern.
2. Establishes the California Worker Technological Displacement Act requiring an employer to provide at least a 60-day advanced written notice before any technological displacement affecting 25 or more workers during any 30-day period. Requires the notice be provided to both of the following:
   1. The workers of the employer affected by the order.
   2. EDD, the local workforce investment board, and the city council members and county board of supervisors of each city and county in the state within which the technological displacement occurs.
3. Requires the technological displacement notice to contain all of the following information:
   1. The name and address of the employment site and the name, email, and telephone number of a company official or public agency contact person.
   2. A statement indicating whether the planned action is permanent or temporary.
   3. The expected date of the first separation and the schedule for subsequent separations.
   4. The number, classification, and work location of layoffs that are substantially due to the replacement or automation by AI.
   5. The job functions performed by those workers that will be automated by AI.
   6. The specific category or type of AI system or other automating technology that substantially resulted in technological displacement, including the entity or entities that developed, sold, or leased the product.
   7. The justification for, and purpose of, the use of the AI tool.
   8. If retraining is available to current workers to transition from eliminated occupations to new ones at the company.
   9. Whether the employer plans to coordinate services, such as a rapid response orientation, through the local workforce development board, a different entity, or the employer does not plan to coordinate services with any entity.
4. Requires the employer, regardless of whether the employer chooses to coordinate services with the local workforce development board or another entity, to include in the notice a functioning email and telephone number of the board and the following description of the rapid response activities offered by the local workforce development board, as specified:

“Local Workforce Development Boards and their partners help laid off workers find new jobs. Visit an America’s Job Center of California location near you. You can get help with your resume, practice interviewing, search for jobs, and more. You can also learn about training programs to help start a new career.”

1. Requires, if the employer chooses to coordinate services with the local workforce development board or another entity, the employer to arrange services within 30 days from the date of the notice.
2. Prohibits an employer from discharging a worker affected by a technological displacement without reasonable and substantiated cause during the 60-day period from when the notice is provided to the worker.
3. Entitles, for employers with more than 100 workers, each worker affected by a technological displacement to the right of first bid on other positions with the employer, however, this requirement shall not apply to the extent that it would conflict with the provisions of a collective bargaining agreement.
4. Requires an employer to provide a written technology hiring disruption notice to EDD when it executes a technological cessation in hiring caused in whole by the adoption of AI or other automating technology. Requires this notice to include all of the following information:
   1. The name and address of the employment site and the name, email, and telephone number of a company official or public agency contact person.
   2. A statement indicating whether the planned action is permanent or temporary.
   3. The number of positions that were occupied at any point during the prior quarter for which the employer has decided not to fill because of a technological cessation in hiring.
   4. The occupational classification and work location of positions that will no longer be filled by humans due to the replacement or automation by AI.
   5. The job functions performed in these positions.
   6. The specific category or type of AI system or other automating technology that resulted in the technological cessation of hiring, including the entity or entities that developed, sold, or leased the product.
   7. The justification for and purpose of the use of the AI tool.
   8. A statement if the cessation resulted in hiring or creation of other employment positions in the company and the number and occupation of those positions.
5. Authorizes an employer required to provide a notice pursuant to Cal-WARN, to include the requirements from this bill in one document to all workers, regardless of the type of layoff.
6. Requires a local educational agency that provides layoff notices pursuant to Sections 45117 and 44955 of the Education Code for classified and certificated staff to provide EDD with a written technology displacement or cessation in hiring notice when it executes a technological displacement or a technological cessation in hiring caused in whole by the adoption of AI or other automating technology. The notice shall be provided on an annual basis and include all of the information required pursuant to (3) above.
7. Requires EDD to post notices received, both the technological displacement and the technology hiring disruption notices, on their internet website and compile a quarterly summary using those notices to present a statewide summary of worker displacement due to AI and automation.
8. Requires the quarterly summary report to include a link to a public database of individual notices received from employers.
9. Requires EDD to submit the report to the labor and budget committees of the Assembly and Senate, as specified.
10. Makes an employer that fails to give notice before ordering a technological displacement liable to each worker entitled to notice who lost their employment. The employer shall be liable for all of the following for each worker:
    1. Back pay at the average regular rate of compensation received by the worker during the last three years of their employment, or the worker’s final rate of compensation, whichever is higher.
    2. The value of the cost of any benefits to which the worker would have been entitled had their employment not been lost, including the cost of any medical expenses incurred by the worker that would have been covered under a worker benefit plan.
11. Provides that liability under these provisions shall be calculated for the entire period of the employer’s violation up to a maximum of 60 days, or one-half the number of days that the worker was employed by the employer, whichever period is shorter.
12. Authorizes the amount of an employer’s liability to be reduced by all of the following:
    1. Any wages paid by the employer to the worker during the period of the employer’s violation, as specified.
    2. Any voluntary and unconditional payments made by the employer to the worker that were not required to satisfy any legal obligation.
    3. Any payments by the employer to a third party or trustee, such as premiums for health benefits or payments to a defined contribution pension plan, on behalf of and attributable to the worker for the period of the violation.
13. Subjects an employer that fails to provide the required technological displacement notice to a civil penalty of not more than five hundred dollars ($500) for each day of the violation. However, the civil penalty shall not apply if the employer pays to all applicable workers the amounts for which the employer is liable, as specified under (12) above, within three weeks from the date the employer orders the technological displacement.
14. Authorizes any person, including any third or uninterested parties, to report to the LC that an employer has failed to comply with the requirements of this bill and requires any such person to provide documentation to substantiate their allegations, including, but not limited to, public statements by employer officials, United States Securities and Exchange Commission filings, and shareholder reports, before the LC considers the report.
15. Authorizes a person, including a local government or a worker representative, seeking to establish liability against an employer to bring a civil action on behalf of the person, other persons similarly situated, or both, in any court of competent jurisdiction.
16. Authorizes the court to 1) award reasonable attorney’s fees and costs to any plaintiff who prevails in a civil action brought under these provisions and 2) if the court determined an employer conducted a reasonable investigation in good faith and had reasonable grounds to believe that its conduct was not a violation of these provisions, then the court may reduce the amount of any penalty imposed against the employer.
17. Grants the LC, in addition to all other powers granted by law, the authority to examine the books and records of an employer.
18. Authorizes the LC to investigate and enforce these provisions through the procedures set forth in existing law, including the procedures for issuing, contesting, and enforcing judgments for citations and civil penalties issued by the commissioner.
19. Establishes the Technological Displacement Act Fund within the State Treasury and requires all civil penalties recovered by the LC to be deposited in the fund and be available to the LC, upon appropriation by the Legislature, for purposes of enforcing these provisions.
20. Provides that these provisions do not supersede greater protections that may be provided by a collective bargaining agreement.
21. Includes a severability clause specifying that if any provision or its application is held invalid, that invalidity shall not affect others that can be given effect without the invalid provision or application.

Background

According to a recent CNBC article, “recent estimates from Goldman Sachs suggest that 6% to 7% of U.S. workers could lose their jobs because of AI adoption. The Stanford Digital Economy Lab, using ADP employment data, found that entry-level hiring in “AI exposed jobs” has dropped 13% since large language models started proliferating. The report said software development, customer service and clerical work are the types of jobs most vulnerable to AI today.”^[1]

Advance notification before a termination or layoff provides employees with necessary time to transition and adjust to the potential loss of employment, time to seek alternative employment and, if necessary, time to obtain skills training or retraining to successfully compete in the job market. Given the unprecedented way in which AI is transforming our economy, providing workers with advance notification before an AI displacement could grant workers this much needed time to adjust and transition to another job.

Need for this bill? According to the author: “Artificial intelligence is transforming our economy at an unprecedented pace…Employers are already citing AI as a reason for layoffs and hiring freezes, yet policymakers lack reliable data to understand the full impact. Without this information, government is forced to respond only after workers have already lost their livelihoods. This bill requires employers to provide written notice to workers and the California Department of Employment Development (EDD) before conducting mass layoffs driven by the development of AI. It builds on the existing California Worker Adjustment and Retraining Notification (WARN) Act by adding notification of layoffs caused by technology. It also provides the state with data on the impact of artificial intelligence on layoffs, reductions in hiring caused, or other technological disruptions to help prevent economic dislocation and harm to workers and communities.”

[NOTE: Please see the Senate Labor, Public Employment and Retirement Committee analysis on this bill for more background information and information on prior and related legislation.]

FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: No

According to the Senate Appropriations Committee:

• The Employment Development Department (EDD) indicates that it would incur one-time General Fund costs of $1.8 million, and $400,000 (minimally) annually thereafter, to implement the provisions of the bill. Additionally, the department notes that the required information technology changes could make the bill’s effective date of January 1, 2027 operationally infeasible.
• The Department of Industrial Relations (DIR) is still reviewing the bill but expects that costs will exceed $300,000 annually for staff (enforcement deputies, support, and supervisory staff) to enforce (1) the technological displacement (WARN like) notice and (2) other requirements.
• This bill could result in increased penalty revenue to the State. The magnitude is unknown.

SUPPORT: (Verified 5/14/26)

California Federation of Labor Unions (Source)

Alameda Labor Council

American Federation of Musicians, Local 7

American Federation of State, County and Municipal Employees, California

California Alliance for Retired Americans

California Employment Lawyers Association

California Faculty Association

California Federation of Teachers

California Nurses Association

California School Employees Association

California State Legislative Board of the SMART - Transportation Division

Center on Policy Initiatives

Central Coast Labor Council

Communications Workers of America, District 9

County Employees Management Association

Electronic Frontier Foundation

Fresno-Madera-Tulare-Kings Central Labor Council

Inland Empire Labor Council

North Bay Labor Council

North Valley Labor Council

Orange County Labor Federation

San Mateo County Central Labor Council

Service Employees International Union, California State Council

State Building and Construction Trades Council of California

TechEquity Action

What We Will

OPPOSITION: (Verified 5/14/26)

Acclamation Insurance Management Services

Allied Managed Care

Associated General Contractors - California

Associated General Contractors - San Diego

Association of California Healthcare Districts

Association of California School Administrators

Calforests

California Apartment Association

California Association of Recreation and Park Districts

California Association of School Business Officials

California Bankers Association

California Chamber of Commerce

California Employment Law Council

California Farm Bureau

California Fuels and Convenience Alliance

California Grocers Association

California Landscape Contractors Association

California League of Food Producers

California Manufacturers and Technology Association

California Restaurant Association

California Retailers Association

California Special Districts Association

California State Association of Counties

California's Credit Unions

Civil Justice Association of California

Flasher Barricade Association

League of California Cities

Los Angeles Area Chamber of Commerce

Official Police Garages of Los Angeles

Public Risk Innovation, Solutions, and Management

Rural County Representatives of California

SHRM California

Small School Districts Association

TechNet

University of California, Office of the President

Urban Counties of California

Western Growers

ARGUMENTS IN SUPPORT: The sponsors of the measure, the California Federation of Labor Unions, write: “Policy makers cannot ignore the blaring alarm bells warning of massive economic upheaval and worker suffering. AI poses an existential threat to human workers, government revenue, and society. The first step to tackling the growing threat is to collect and use reliable, local data to inform policy responses and to support workers who are the canaries in the coal mine of AI. This bill is a small, but crucial first step to that process.

SB 951 provides policy makers and the public with data on AI-related job loss.”

ARGUMENTS IN OPPOSITION: A coalition of employer organizations, including the California Chamber of Commerce, are opposed arguing, among other things, that this bill “would impose expansive and burdensome requirements that will discourage innovation, increase litigation risk, and make California employees less competitive. SB 951 would significantly expand California’s current WARN Act (Cal-WARN) obligations far beyond traditional workforce reductions by creating an entirely new statute with sweeping new compliance obligations triggered by the adoption of artificial intelligence (AI) and other commonly used business technologies. The bill’s broad definitions, duplicative reporting mandates, and new liability exposure would create substantial uncertainty for employers seeking to modernize operations responsibly.”

Opposition from local government agencies argue that “SB 951 creates processes that are likely better suited for private labor practices, and does not fit local government employers. This bill would mandate costly administrative procedures for implementation, and would create liability exposure for complaints brought by any member of the public for possible violations.”

Prepared by: Alma Perez-Schwab / L., P.E. & R. / (916) 651-1556

5/18/26 15:05:44

**** END ****

1. Samantha Subin, “AI is already taking white-collar jobs. Economists warn there’s ‘much more in the tank,’” October 23, 2025, CNBC. https://www.cnbc.com/2025/10/22/ai-taking-white-collar-jobs-economists-warn-much-more-in-the-tank.html ↑

SENATE COMMITTEE ON

Senator Sabrina Cervantes, Chair

2025 - 2026 Regular Session

SB 951 (Reyes) - Employment: technological displacement: notice

Bill Summary:

SB 951 would establish the California Worker Technological Displacement (WARN) Act, as specified.

*********** ANALYSIS ADDENDUM – SUSPENSE FILE ***********

The following information is revised to reflect amendments

adopted by the committee on May 14, 2026

Fiscal Impact:

• The Employment Development Department (EDD) indicates that it would incur one-time General Fund costs of $1.8 million, and $400,000 (minimally) annually thereafter, to implement the provisions of the bill. Additionally, the department notes that the required information technology changes could make the bill’s effective date of January 1, 2027 operationally infeasible.
• The Department of Industrial Relations (DIR) is still reviewing the bill but expects that costs will exceed $300,000 annually for staff (enforcement deputies, support, and supervisory staff) to enforce (1) the technological displacement (WARN like) notice and (2) other requirements.
• This bill could result in increased penalty revenue to the State. The magnitude is unknown.

Author Amendments:

Among other changes:

• Align timelines for notice with existing California WARN Act. Notice would be triggered only when 25 or more workers are displaced, removing the “25% of the workforce” metric that currently captures small businesses.
• Modify the definitions of “technological displacement” and “technological cessation in hiring,” as specified.
• Exclude Local Education Agencies that already provide layoff notices pursuant to existing education code.
• Limit the disclosure of AI tools used in automation.

-- END --

SENATE COMMITTEE ON

Senator Sabrina Cervantes, Chair

2025 - 2026 Regular Session

SB 951 (Reyes) - Employment: technological displacement: notice

Bill Summary:

SB 951 would establish the California Worker Technological Displacement (WARN) Act, as specified.

Fiscal Impact:

• The Employment Development Department (EDD) indicates that it would incur one-time General Fund costs of $1.8 million, and $400,000 (minimally) annually thereafter, to implement the provisions of the bill. Additionally, the department notes that the required information technology changes could make the bill’s effective date of January 1, 2027 operationally infeasible.
• Administrative costs to the Department of Industrial Relations (DIR) have yet to be identified.
• This bill could result in increased penalty revenue to the State. The magnitude is unknown.

Background:

Workplace surveillance tools are technologies used by employers to monitor and evaluate things such as workflow and employee activities and performance. Common examples include keystroke logging software, which tracks keyboard activity to gauge productivity, and screen monitoring tools that capture screenshots or live feeds of employee screens. Email and communication monitoring systems are also widely used to scan messages for sensitive information or inappropriate content. GPS tracking is used to monitor employees’ location and movement, both in the field and in factories and other workplaces. Additionally, video surveillance cameras in offices or warehouses can monitor physical behavior and security. In recent years, some employers are even requiring workers to wear tracking tools that monitor not only location and movement, but biometric information. These tools aim to enhance productivity and security; at the same time, however, they raise concerns in several areas, including privacy.

The federal WARN Act requires employers to provide written notice 60 days prior to a plant closing or mass layoff to employees, or their representative, the State dislocated worker unit (EDD, Workforce Services Division in California), and the chief elected official of local government within which such closing or layoff occurs. The federal WARN Act applies to employers with 100 or more full-time employees. Notices are required as follows: (1) for plant closings involving 50 or more employees during a 30-day period, (2) for layoffs within a 30-day period involving 50 to 499 full-time employees comprising at least one-third of the full-time workforce at a single site of employment, and (3) for layoffs of 500 or more are covered regardless of percentage of workforce.

Similarly, Cal-WARN requires employers to give a 60-day notice to the affected employees and both state and local representatives before a mass layoff, relocation, or termination. The Cal-WARN provisions apply to employers of 75 or more full-time and part-time employees. Notices are required as follows: (1) for a plant closure affecting any amount of employees, (2) for layoffs of 50 or more employees within a 30-day period regardless of workforce percentage, (3) for relocation of at least 100 miles affecting any amount of employees, and (4) for relocation of a call center to a foreign country regardless of the percentage of workforce affected.

Advance notification before a termination or layoff provides employees with necessary time to transition and adjust to the potential loss of employment, time to seek alternative employment and, if necessary, time to obtain skills training or retraining to successfully compete in the job market.

Proposed Law:

This bill, among other things, would do the following:

• Require an employer, as defined, to provide at least a 90-day advanced written notice, as described, before any technological displacement affecting 25 or more workers or 25 percent of the workforce, whichever is less.
• Require an employer to provide that notice to affected workers, EDD, and specified state and local entities.
• Require an employer to provide a written technology hiring disruption notice to EDD and the local workforce investment board when it executes a technological cessation in hiring directly and primarily due to the adoption of artificial intelligence or other automating technology.
• Impose specified reporting requirements on EDD.
• For employers with more than 100 workers, entitle workers affected by technological displacement to a right of first bid on other positions with the employer.
• Prohibit an employer, during the 90-day period from when notice is provided to the worker, from discharging a worker affected by a technological displacement without reasonable and substantiated cause.
• Make an employer that fails to give notice before ordering a technological displacement liable for back pay and benefits to each worker for a maximum of 60 days or one-half the number of days the worker was employed, whichever period is shorter.
• Impose a $500 civil penalty for each day of the employer’s violation, except as provided.
• Set forth procedures for reporting violations to the Labor Commissioner and filing a civil action in court. Provide enforcement authority and related powers to the Labor Commissioner.
• Establish the Technological Displacement Act Fund, and require all civil penalties recovered by the Commissioner to be deposited in the fund, and make all moneys in the fund available to the Commissioner upon appropriation.

Related Legislation:

• SB 947 (McNerney), among other things, would (1) prohibit an employer from using an ADS that does certain functions and would limit the purposes and manner in which an ADS may be used to make disciplinary, termination, or deactivation decisions, (2) require an employer to provide a written postuse notice when an employer has used an ADS, as specified, (3) include worker anti-retaliation provisions for exercising these rights, and (4) specify enforcement provisions including specified penalties and relief for violations. The bill is currently pending in this Committee.
• SB 1248 (Cabaldon) would impose certain restrictions on the use of an ADS by a state agency to confer services. The bill is currently pending in this Committee.
• SB 617 (Arreguin, Chapter 229, Statutes of 2025) expanded the information employers are required to include in a Cal-WARN notice and requires employers that choose to coordinate services through a local workforce development board or another entity to do so within 30 days of the notice.

-- END --

SENATE PRIVACY, DIGITAL TECHNOLOGIES, AND CONSUMER PROTECTION COMMITTEE

Senator Christopher Cabaldon, Chair

2025-2026 Regular Session

Bill No: SB 951 (Author:Reyes)

Version: April 9, 2026

Hearing Date: April 20, 2026

Fiscal: Yes

Urgency: No

Consultant: BH

SUBJECT

Employment: technological displacement: notice

DIGEST

This bill protects employees notified of job loss through technological displacement and requires employers to provide data to Employment Development Department, the state and local entities as specified.

EXECUTIVE SUMMARY

This bill requires employers to provide advanced notice to affected workers of technological displacement as specified. The bill provides protection during the notice period and requires the employer to provide data to Employment Development Department (EDD), state and local entities as specified. This data is required for state agencies to understand the impacts of Artificial Intelligence (AI) and other technological advancements on the state’s workforce. The bill also provides for civil penalties and additional reporting requirements for employers.

This bill is sponsored by the California Labor Federation with the American Federation of State, County and Municipal Employees (AFSCME) in support. The bill is opposed by a variety of industry and local government associations. Opposition from small businesses and entities (The California Landscape Contractors Association and the Small School District’s Association) argues that the data collection and reporting requirements create a significant administrative burden for them. Issues surrounding data verification and process oversight remain a concern. This bill passed out of the Senate Committee on Labor, Public Employment and Retirement on a 3 to 1 vote.

PROPOSED CHANGES TO THE LAW

1. Existing Federal law:

Establishes the federal Worker Adjustment and Retraining Notification (WARN) Act, which prohibits an employer of 100 or more full-time employees from ordering a mass layoff, relocation, or termination at a covered establishment, as defined, unless, 60 days before the order takes effect, the employer gives written notice of the order to the employees.

Makes WARN applicable to businesses that have 100 or more full-time employees who have been employed more than six out of the preceding 12 months and businesses that have 100 or more employees, including part-time employees who work more than 4,000 regular hours per week collectively

1. Existing State law:
   
   Establishes CalWARN, which requires employers with 75 or more full and part time employees to provide 60 days’ written notice before employee termination, relocation, or mass layoff of 50 or more employees. Written notice must be provided to the employees of the covered establishment, the Employment Development Department, the local workforce investment board, and the chief elected official of each city and county government.
   
   Exempts, from the CalWARN, seasonal employees and employees who are laid off as a result of the completion of a project in specified industries, where the employers are subject to specified wage orders, and the employees were hired with the understanding that their employment was seasonal and temporary.
   
   States that an employer that fails to give the required CalWARN notice before ordering a mass layoff, relocation, or termination is liable to each employee entitled to notice, as defined (Labor Code Section 1400 et. al.).
   

This bill:

1. Defines the following terms:
   1. “Artificial intelligence” or “AI” means an engineered or machine-based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.
   2. “Employer” means any individual who, or entity that directly or indirectly, or through an agent or any other person, employs or exercises control over the wages, benefits, other compensation, hours, working conditions, access to work or job opportunities, or other terms or conditions of employment, of any worker. An “employer” includes, but is not limited to, any of the following:
      1. The state, including its legislative, judicial, and executive branches.
      2. Any city, County, or city and county, and other political subdivisions of the state.
      3. Special districts, including, but not limited to, school districts.
      4. Any authority, commission, board, agency, or instrumentality of any entity as specified.
      5. The University of California, the California State University, and community college districts.
   3. “Technological displacement” means the elimination of employment positions within any 12-month period, caused in whole or primarily by an AI system or other automated technology replacing or automating those employment positions.
   4. “Technological cessation in hiring” means the end of hiring permanently for an occupation or position that is due to the use of AI or other automation that displaces or replaces human workers. “Technological cessation in hiring” does not mean an overall reduction in employment positions.
   5. “Worker” means an individual employed or contracted by an employer for at least 6 months of the 12 months preceding the date on which notice is required under this article. “Worker” includes, but is not limited to, full-time and part-time workers and independent contractors, but does not include a seasonally employed individual who was hired with the understanding that their employment is seasonal and temporary, a volunteer, or an intern.
2. Establishes the California Worker Technological Displacement Act, requiring an employer to provide a 90-day advanced written notice before any technological displacement affecting 25 or more workers or 25 percent of the workforce, whichever is less. Requires the notice be provided to both of the following:
   1. The workers of the employer affected by the order.
   2. EDD, the local workforce investment board, and the city council members and county board of supervisors of each city and county in the state within which the technological displacement, reduction, or termination of contract occurs.
3. Requires the technological displacement notice to contain all of the following information:
   1. The name and address of the employment site and the name, email, and telephone number of a company official.
   2. A statement indicating whether the planned action is permanent or temporary.
   3. The number of positions of the employer that were occupied at any point during the prior quarter for which the employer has decided not to fill because of a technological cessation in hiring.
   4. The occupational classification and work location of layoffs that are substantially due to the replacement or automation by AI.
   5. The job functions performed by those workers that will be automated by AI.
   6. The AI system or other automating technology that substantially resulted in technological displacement, including the entity or entities that developed, sold, or leased the product.
   7. The justification for, and purpose of, the use of the AI tool.
   8. If retraining is available to current workers to transition from eliminated occupations to new ones at the company.
4. Prohibits an employer with 100 workers or more from discharging a worker affected by a technological displacement or termination of contract during the 90-day period from when the notice is provided to the worker.
5. During the 90 day period from when the notice is provided to the worker, an employer shall not discharge without reasonable and substantiated cause a worker affected by a technological displacement.
6. For employers with more than 100 workers, the bill entitles each worker affected by a technological displacement to the right of first bid on other positions with the employer.
7. Requires an employer to provide a written technology hiring disruption notice when it executes a technological cessation in hiring directly and primarily due to the adoption of AI or other automating technology to EDD, the local workforce investment board, and the chief elected official of each city and county within which the AI hiring disruption occurs.
8. Requires the technology hiring disruption notice to include all of the following information:
   1. The name and address of the employment site and the name, email, and telephone number of a company official.
   2. A statement indicating whether the planned action is permanent or temporary.
   3. The number of positions that were occupied at any point during the prior quarter for which the employer has decided not to fill because of a technological cessation in hiring.
   4. The occupational classification and work location of positions that will no longer be filled by humans due to the replacement or automation by AI.
   5. The job functions performed in these positions.
   6. The AI system or other automating technology that resulted in the cessation of hiring.
   7. The justification for and purpose of the use of the AI tool.
   8. A statement if the cessation resulted in hiring or creation of other employment positions in the company and the number and occupation of those positions.
9. Authorizes an employer required to provide a notice pursuant to Cal-WARN to include the requirements from this bill in one document to all workers, regardless of the type of layoff.
10. Requires EDD to post notices received, pursuant to the above described provisions, on their internet website and compile a quarterly summary using those notices to present a statewide summary of worker displacement due to AI and automation.
11. Requires the quarterly summary report to include a link to a public database of individual notices received from employers.
12. Requires EDD to submit the report to the labor and budget committees of the Assembly and Senate, as specified.
13. Makes an employer that fails to give notice before ordering a technological displacement liable to each worker entitled to notice who lost their employment. The employer shall be liable for all of the following for each worker:
    1. Back pay at the average regular rate of compensation received by the worker during the last three years of their employment, or the worker’s final rate of compensation, whichever is higher.
    2. The value of the cost of any benefits to which the worker would have been entitled had their employment not been lost, including the cost of any medical expenses incurred by the worker that would have been covered under a worker benefit plan.
14. Provides that liability under these provisions shall be calculated for the entire period of the employer’s violation up to a maximum of 60 days, or one-half the number of days that the worker was employed by the employer, whichever period is shorter.
15. Authorizes the amount of an employer’s liability to be reduced by all of the following:
    1. Any wages paid by the employer to the worker during the period of the employer’s violation, as specified.
    2. Any voluntary and unconditional payments made by the employer to the worker that were not required to satisfy any legal obligation.
    3. Any payments by the employer to a third party or trustee, such as premiums for health benefits or payments to a defined contribution pension plan, on behalf of and attributable to the worker for the period of the violation.
16. Subjects an employer that fails to provide the required technological displacement notice to a civil penalty of not more than five hundred dollars ($500) for each day of the violation. However, the civil penalty shall not apply if the employer pays to all applicable workers the amounts for which the employer is liable, as specified under (12) above, within three weeks from the date the employer orders the technological displacement or termination of contract.
17. Authorizes any person, including any third or uninterested parties, to report to the LC that an employer has failed to comply with the requirements of this bill and requires any such person to provide documentation to substantiate their allegations, including, but not limited to, public statements by employer officials, United States Securities and Exchange Commission filings, and shareholder reports, before the LC considers the report.
18. Authorizes a person, including a local government or a worker representative, seeking to establish liability against an employer to bring a civil action on behalf of the person, other persons similarly situated, or both, in any court of competent jurisdiction.
19. Authorizes the court to 1) award reasonable attorney’s fees and costs to any plaintiff who prevails in a civil action brought under these provisions and 2) if the court determined an employer conducted a reasonable investigation in good faith and had reasonable grounds to believe that its conduct was not a violation of these provisions, then the court may reduce the amount of any penalty imposed against the employer.
20. Grants the LC, in addition to all other powers granted by law, the authority to examine the books and records of an employer.
21. Authorizes the LC to investigate and enforce these provisions through the procedures set forth in existing law, including the procedures for issuing, contesting, and enforcing judgments for citations and civil penalties issued by the commissioner.
22. Establishes the Technological Displacement Act Fund within the State Treasury and requires all civil penalties recovered by the LC to be deposited in the fund and be available to the LC, upon appropriation by the Legislature, for purposes of enforcing these provisions.
23. Includes a severability clause specifying that if any provision or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.

COMMENTS

1. The Author has provided the following statement

“Artificial Intelligence is transforming our economy at an unprecedented pace. Unlike past technological advances, AI has the ability to automate entire occupations almost overnight, leaving workers vulnerable to sudden economic disruption. Employers are already citing AI as a reason for layoffs and hiring freezes, yet policymakers lack reliable data to understand the full impact. Without this information, government is forced to respond only after workers have already lost their livelihoods.

SB 951 modernizes California’s existing Worker Adjustment and Retraining Notification Act by requiring employers to provide a 90-day advance notice when mass layoffs are driven by artificial intelligence or technological automation. This ensures workers and the state have time to prepare and respond, while also allowing the state to collect critical data on AI-related job loss and workforce disruption. This information will help policymakers better understand how AI is reshaping our labor market and craft informed, proactive solutions.

Innovation should not come at the expense of working families. SB 951 ensures transparency, preparedness, and accountability as artificial intelligence becomes a permanent part of California’s economy.”

1. Ongoing Legislative efforts to regulate AI

Over the last several years, the Legislature has considered a multitude of bills aimed at regulating AI and its use to ensure that the privacy rights of Californians continue to be protected. AB 2885 (Bauer-Kahan, Chapter 843, Statutes of 2024) was a crucial first step in regulating this technology. AB 2885 established key definitions, including a uniform definition for “artificial intelligence,” “automated decision system,” and “high-risk automated decision system.”

Other efforts attempted to regulate the industry by establishing requirements on the use of AI, although the focus was mostly on consumers and their technology rights, whether it be the data social media companies collect and sell or the manipulation of election news via fake postings. In the area of private sector labor and employment specifically, 2025 was the year in which we saw several proposals attempting to regulate how AI-powered tools are used.

SB 7 (McNerney, 2025) attempted to regulate the use of ADS’ in the employment setting by, among other things, 1) requiring employers to provide a written notice that an ADS is in use at the workplace to all workers directly affected by the ADS; 2) prohibiting in some instances and in others limiting the use of an ADS, as specified; 3) providing worker anti-retaliation protections for exercising these rights; and 4) specifying enforcement mechanisms that included penalties and relief for violations. SB 7 was vetoed by Governor Newsom.

Several other bills attempted to regulate AI and ADS use last year, including AB 1018 (Bauer-Kahan, 2025, Pending on Senate Inactive File), which would, among other things, regulate the development and deployment of an ADS used to make consequential decisions, as defined. AB 1221 (Bryan, 2025, held in Assembly Appropriations Committee) attempted to regulate the use of workplace surveillance tools and an employer’s use of worker data by, among other things, requiring an employer to provide workers with a written notice regarding the need for the surveillance tool. Finally, AB 1331 (Elhawary, 2025, Pending on Senate Inactive File) would limit the use of workplace surveillance tools, including by prohibiting an employer from monitoring or surveilling workers in private, off-duty areas, as specified.

3. Arguments in support:

Supporters recognize the rapid transformation of both the public and private sector workplaces with the deployment of AI. The American Federation of State, County and Municipal Employees (AFSCME) argues that technological displacement is not limited to layoffs alone. “By requiring reporting on reductions in hiring due to AI adoption,” they argue, “the bill captures a broader and often overlooked dimension of workforce impact.” As AI adoption places at risk ever larger portions of the California workforce, the need to see and understand these changes becomes paramount.

A coalition of labor groups including the California Federation of Labor Unions (sponsor), the Service Employees International Union and the American Federation of State, County and Municipal Employees write, “Policy makers cannot ignore the blaring alarm bells warning of massive economic upheaval and worker suffering.” The first step in tackling these problems, they argue, is to “collect and use reliable, local data to inform policy responses and to support workers who are the canaries in the coal mine of AI.”

4. Arguments in opposition:

Impacts from AI are clearly spreading across all sectors and sizes of business endeavors. However, not all businesses have the same capacity to comply with the data collection and reporting requirements in the bill. Small businesses like the California Landscape Contractors Association are concerned the bill “creates substantial administrative burdens, requiring employers to track, report, and notify multiple entities while managing first-bid right for displaced workers.” The California Manufacturers and Technology Association is also concerned that the bill “requires a burdensome 90-day advance notice for relatively small impacts.”

Beyond capacity, questions of whether the structured mechanism for data collection, reporting, and notification is appropriate for all entities covered by the bill. The Small School District’s Association writes:

“Regrettably, SB 951 creates processes that are likely better suited for private labor practices and does not fit schools serving TK-12 grade levels. First, for school employers, SB 951 would create a bifurcated system of layoff notice procedures outside the well-established March 15 layoff notice process that applies to both certificated and classified positions. Further, the rehire procedures in SB 951 could bump other school employees from their return-to-work rehiring rights by undermining both existing collectively bargained agreements and statewide practices conforming with California Education Code statutes.”

The author has agreed to the following Committee amendment that limits where certain notices must be sent:

1414.3(a) An employer shall provide a written technology hiring disruption notice when it executes a technological cessation in hiring directly and primarily due to the adoption of AI or other automation technology.

(b) The notice shall be given to the Employment Development Department and the local workforce investment board. and the chief elected official of each city and county within which the AI hiring disruption occurs.

SUPPORT

Alameda Labor Council
American Federation of Musicians, Local 7
American Federation of State, County and Municipal Employees (AFSCME) California
American Federation of State, County and Municipal Employees, AFL-CIO
California Alliance for Retired Americans (CARA)
California Employment Lawyers Association
California Faculty Association
California Federation of Labor Unions, AFL-CIO
California Federation of Teachers AFL-CIO
California School Employees Association
California State Legislative Board of the Sheet Metal, Air, Rail and Transportation Workers - Transportation Division (SMART-TD)
Center on Policy Initiatives
Central Coast Labor Council
Central Labor Council, Fresno-Madera-Tulare-kings Counties, AFL-CIO
Communications Workers of America, District 9
Electronic Frontier Foundation
Inland Empire Labor Council, AFL-CIO
North Bay Labor Council
North Valley Labor Federation
Orange County Labor Federation, AFL-CIO
San Mateo County Central Labor Council
Service Employees International Union, California State Council
TechEquity Collaborative
What We Will

OPPOSITION

Acclamation Insurance Management Services
Association of California School Administrators

Allied Managed Care
Associated General Contractors of California
Associated General Contractors San Diego
Calforests
California Apartment Association
California Bankers Association
California Chamber of Commerce
California Employment Law Council
California Farm Bureau
California Fuels and Convenience Alliance
California Grocers Association
California Landscape Contractor's Association
California Landscape Contractors Association
California League of Food Producers
California Manufacturers and Technology Association
California Manufacturers & Technology Association
California Restaurant Association
California Retailers Association
California's Credit Unions
Civil Justice Association of California (CJAC)
Flasher Barricade Association
Los Angeles Area Chamber of Commerce
Los Angeles Chamber of Commerce
Official Police Garages of Los Angeles
Shrm California
Technet
Small School Districts’ Association

Western Growers

**************

SENATE COMMITTEE ON LABOR, PUBLIC EMPLOYMENT AND RETIREMENT

Senator Lola Smallwood-Cuevas, Chair

2025 - 2026 Regular

Bill No: SB 951 Hearing Date: April 8, 2026

SUBJECT: Employment: technological displacement: notice

KEY ISSUES

This bill establishes the California Worker Technological Displacement Act to 1) require employers to provide a 90-day advanced written notice before any technological displacement affecting a specified number of its workforce; 2) prohibit employers from discharging an affected worker during this 90-day period; 3) require an employer to provide a written technology hiring disruption notice to specified government entities when it executes a technological cessation in hiring due to the adoption of artificial intelligence (AI) or other automating technology; 4) require the Employment Development Department (EDD) to post the notices received online and compile a report, as specified; 5) grant specified workers affected by a technological displacement the right of first bid on other positions with the employer; and 6) prescribe penalties and specified remedies for violations, including the filing of a civil action.

ANALYSIS

Existing federal law:

1. Establishes the federal Worker Adjustment and Retraining Notification (WARN) Act prohibiting specified employers from ordering a plant closure or mass layoff until the end of a 60-day period after the employer serves written notice of such an order to the following:
   1. To each representative of the affected employees as of the time of the notice or, if there is no such representative at that time, to each affected employee; and
   2. To the State or entity designated by the State to carry out rapid response activities, as specified, and the chief elected official of the unit of local government within which such closing or layoff is to occur.

(29 U.S.C. §§2101)

1. Applies the federal WARN notice requirements to employers with 100 or more full-time employees (not counting workers who have less than 6 months on the job and workers who work fewer than 20 hours per week) and is laying off at least 50 people at a single site of employment, or employs 100 or more workers who work at least a combined 4,000 hours per week, and is a private for-profit business, private non-profit organization, or quasi-public entity separately organized from regular government. (29 U.S.C. §§2101)
2. Makes an employer who violates the federal WARN provisions liable to each employee for an amount equal to back pay and benefits for the period of the violation, up to 60 days, but no more than half the number of days the employee was employed by the employer. (29 U.S.C. §§2104)

Existing state law:

1. Establishes the California Worker Adjustment and Retraining Act (Cal-WARN), which prohibits an employer with 75 or more full and part-time employees from ordering a mass layoff (of 50 or more employees within a 30-day period), relocation, or termination at a covered establishment, as defined, unless, 60 days before the order takes effect, the employer gives written notice to all of the following:
   1. The employees of the covered establishment affected by the order.
   2. The Employment Development Department, the local workforce investment board, and the chief elected official of each city and county government within which the termination, relocation, or mass layoff occurs.

(Labor Code §1400-1413)

1. Defines, for purposes of the Cal-WARN Act, an “employer” as any person, association, organization, partnership, business trust, limited liability company, or corporation who directly or indirectly owns and operates a covered establishment. A parent corporation is an employer as to any covered establishment directly owned and operated by its corporate subsidiary. (Labor Code §1400.5)
2. Exempts, from the provisions of Cal-WARN, seasonal employees and employees that are laid off as a result of the completion of a project in specified industries, where the employers are subject to specified wage orders, and the employees were hired with the understanding that their employment was seasonal and temporary. (Labor Code §1400.5.)
3. Requires employers mandated to give notice of any mass layoff, relocation, or termination pursuant to Cal-WARN to include in its notice, the elements required by the federal WARN Act. (Labor Code §1401)
4. Makes an employer that fails to give the required Cal-WARN notice before ordering a mass layoff, relocation, or termination liable to each employee entitled to notice, for specified back pay and medical expenses incurred that would have been covered under an employee benefit plan, calculated for the period of the employer’s violation, up to a maximum of 60 days, or half the number of days that the employee was employed by the employer, whichever period is shorter. (Labor Code §1402)
5. Subjects an employer who fails to give the required Cal-WARN notice to a civil penalty of not more than five hundred dollars ($500) for each day of the employer’s violation. Exempts an employer from this civil penalty if the employer pays all applicable employees within three weeks from the date the employer ordered the mass layoff, relocation, or termination. (Labor Code §1403)
6. Permits a person, including a local government, or an employee representative, seeking to establish liability against an employer for violation of Cal-WARN to bring a civil action on behalf of the person other persons similarly situated, or both, in any court of competent jurisdiction. Additionally, permits a court to award reasonable attorney’s fees as part of the costs to any plaintiff who prevails in a civil action. (Labor Code §1404)
7. Defines “artificial intelligence” (AI) to mean an engineered or machine-based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments. (Government Code §11546.45.5)
8. Establishes the Department of Industrial Relations (DIR) in the Labor and Workforce Development Agency (LWDA), and vests it with various powers and duties to foster, promote, and develop the welfare of the wage earners of California, to improve their working conditions, and to advance their opportunities for profitable employment. (Labor Code §50.5)
9. Establishes within the DIR, various entities including the Division of Labor Standards Enforcement (DLSE) under the direction of the Labor Commissioner (LC), and empowers the LC with ensuring a just day’s pay in every workplace and promotes economic justice through robust enforcement of labor laws. (Labor Code §79-107)
10. Establishes the Employment Development Department (EDD) in the Labor and Workforce Development Agency (LWDA), and vests it with various duties and responsibilities including job creation activities, administration of the Unemployment, Disability, and Paid Family Leave programs, collection of payroll taxes, keeping track of employment records, managing federal job training programs, and collecting and sharing information about the job market. (Unemployment Insurance Code §301)

This bill:

1. Defines, among others, the following terms:
   1. “Employer” means any individual who, or entity that, directly or indirectly, or through an agent or any other person, employs or exercises control over the wages, benefits, other compensation, hours, working conditions, access to work or job opportunities, or other terms or conditions of employment, of any worker. An “employer” includes, but is not limited to, any of the following:
      1. The state, including its legislative, judicial, and executive branches.
      2. Any city, county, or city and county, including any charter city, charter county, charter city and county, and other political subdivisions of the state.
      3. Special districts, including, but not limited to, school districts.
      4. Any authority, commission, board, agency, or instrumentality of any entity specified in paragraphs (1) to (3), inclusive.
      5. The University of California, the California State University, and community college districts.
   2. “Technological displacement” means the elimination of employment positions within any 12-month period, caused in whole or primarily by an AI system or other automated technology replacing or automating those employment positions.
   3. “Technological cessation in hiring” means the end of hiring permanently for an occupation or position that is directly and primarily due to the use of AI or other automation that displaces or replaces human workers. “Technological cessation in hiring” does not mean an overall reduction in employment positions.
   4. “Worker” means an individual employed or contracted by an employer for at least 6 months of the 12 months preceding the date on which notice is required under this article. “Worker” includes, but is not limited to, full-time and part-time workers and independent contractors, but does not include a seasonally employed individual who was hired with the understanding that their employment is seasonal and temporary, a volunteer, or an intern.

Technological Displacement Notice:

1. Establishes the California Worker Technological Displacement Act requiring an employer to provide a 90-day advanced written notice before any technological displacement affecting 25 or more workers or 25 percent of the workforce, whichever is less. Requires the notice be provided to both of the following:
   1. The workers of the employer affected by the order.
   2. EDD, the local workforce investment board, and the city council members and county board of supervisors of each city and county in the state within which the technological displacement, reduction, or termination of contract occurs.
2. Requires the technological displacement notice to contain all of the following information:
   1. The name and address of the employment site and the name, email, and telephone number of a company official.
   2. A statement indicating whether the planned action is permanent or temporary.
   3. The expected date of the first separation and the schedule for subsequent separations.
   4. The number, classification, and work location of layoffs that are substantially due to the replacement or automation by AI.
   5. The job functions performed by those workers that will be automated by AI.
   6. The AI system or other automating technology that substantially resulted in technological displacement, including the entity or entities that developed, sold, or leased the product.
   7. The justification for, and purpose of, the use of the AI tool.
   8. If retraining is available to current workers to transition from eliminated occupations to new ones at the company.
3. Prohibits an employer with 100 workers or more from discharging a worker affected by a technological displacement or termination of contract during the 90-day period from when the notice is provided to the worker.
4. For employers with more than 100 workers, entitles each worker affected by a technological displacement to the right of first bid on other positions with the employer.

Technology Hiring Disruption Notice:

1. Requires an employer to provide a written technology hiring disruption notice when it executes a technological cessation in hiring directly and primarily due to the adoption of AI or other automating technology to EDD, the local workforce investment board, and the chief elected official of each city and county within which the AI hiring disruption occurs.
2. Requires the technology hiring disruption notice to include all of the following information:
   1. The name and address of the employment site and the name, email, and telephone number of a company official.
   2. A statement indicating whether the planned action is permanent or temporary.
   3. The number of positions that were occupied at any point during the prior quarter for which the employer has decided not to fill because of a technological cessation in hiring.
   4. The occupational classification and work location of positions that will no longer be filled by humans due to the replacement or automation by AI.
   5. The job functions performed in these positions.
   6. The AI system or other automating technology that resulted in the cessation of hiring.
   7. The justification for and purpose of the use of the AI tool.
   8. A statement if the cessation resulted in hiring or creation of other employment positions in the company and the number and occupation of those positions.
3. Authorizes an employer required to provide a notice pursuant to Cal-WARN, to include the requirements from this bill in one document to all workers, regardless of the type of layoff.

Public Posting and Reporting:

1. Requires EDD to post notices received, pursuant the above described provisions, on their internet website and compile a quarterly summary using those notices to present a statewide summary of worker displacement due to AI and automation.
2. Requires the quarterly summary report to include a link to a public database of individual notices received from employers.
3. Requires EDD to submit the report to the labor and budget committees of the Assembly and Senate, as specified.

Liability and Enforcement:

1. Makes an employer that fails to give notice before ordering a technological displacement liable to each worker entitled to notice who lost their employment. The employer shall be liable for all of the following for each worker:
   1. Back pay at the average regular rate of compensation received by the worker during the last three years of their employment, or the worker’s final rate of compensation, whichever is higher.
   2. The value of the cost of any benefits to which the worker would have been entitled had their employment not been lost, including the cost of any medical expenses incurred by the worker that would have been covered under a worker benefit plan.
2. Provides that liability under these provisions shall be calculated for the entire period of the employer’s violation up to a maximum of 60 days, or one-half the number of days that the worker was employed by the employer, whichever period is shorter.
3. Authorizes the amount of an employer’s liability to be reduced by all of the following:
   1. Any wages paid by the employer to the worker during the period of the employer’s violation, as specified.
   2. Any voluntary and unconditional payments made by the employer to the worker that were not required to satisfy any legal obligation.
   3. Any payments by the employer to a third party or trustee, such as premiums for health benefits or payments to a defined contribution pension plan, on behalf of and attributable to the worker for the period of the violation.
4. Subjects an employer that fails to provide the required technological displacement notice to a civil penalty of not more than five hundred dollars ($500) for each day of the violation. However, the civil penalty shall not apply if the employer pays to all applicable workers the amounts for which the employer is liable, as specified under (12) above, within three weeks from the date the employer orders the technological displacement or termination of contract.
5. Authorizes any person, including any third or uninterested parties, to report to the LC that an employer has failed to comply with the requirements of this bill and requires any such person to provide documentation to substantiate their allegations, including, but not limited to, public statements by employer officials, United States Securities and Exchange Commission filings, and shareholder reports, before the LC considers the report.
6. Authorizes a person, including a local government or a worker representative, seeking to establish liability against an employer to bring a civil action on behalf of the person, other persons similarly situated, or both, in any court of competent jurisdiction.
7. Authorizes the court to 1) award reasonable attorney’s fees and costs to any plaintiff who prevails in a civil action brought under these provisions and 2) if the court determined an employer conducted a reasonable investigation in good faith and had reasonable grounds to believe that its conduct was not a violation of these provisions, then the court may reduce the amount of any penalty imposed against the employer.
8. Grants the LC, in addition to all other powers granted by law, the authority to examine the books and records of an employer.
9. Authorizes the LC to investigate and enforce these provisions through the procedures set forth in existing law, including the procedures for issuing, contesting, and enforcing judgments for citations and civil penalties issued by the commissioner.
10. Establishes the Technological Displacement Act Fund within the State Treasury and requires all civil penalties recovered by the LC to be deposited in the fund and be available to the LC, upon appropriation by the Legislature, for purposes of enforcing these provisions.
11. Includes a severability clause specifying that if any provision or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.

COMMENTS

1. Background:

Artificial Intelligence and Automated Decision Systems (ADS)

With technological advancements happening faster than humans can react, we often miss opportunities to pause and evaluate its impact. Until recently, advancements in technology often automated physical tasks, such as those performed on factory floors or self-checkouts, but AI functions more like human brainpower. AI can use algorithms to accomplish tasks faster and sometimes at a lower cost than human workers can. As this technology develops, so do fears of worker displacement in more areas and industries.

According to a recent CNBC article, “recent estimates from Goldman Sachs suggest that 6% to 7% of U.S. workers could lose their jobs because of AI adoption. The Stanford Digital Economy Lab, using ADP employment data, found that entry-level hiring in “AI exposed jobs” has dropped 13% since large language models started proliferating. The report said software development, customer service and clerical work are the types of jobs most vulnerable to AI today.”^[1]

In February of 2019, Data & Society, an independent non-profit research institute, published a study evaluating the impact of algorithmic management on the workforce. The study highlights several examples where algorithmic management is becoming more common. In the delivery industry, companies from UPS to Amazon to grocery chains are using automated systems to optimize delivery workers’ daily routes. In other industries, trends show an increase in remote tracking and managing using AI software. In retail and service jobs, automated scheduling is replacing managers’ discretion over employee schedules, while the work of evaluating employees is being transferred to consumer-sourced rating systems.^[2]

In these examples, the AI technology is at least complementing the tasks of workers. In other examples, as highlighted in a 2021 UC Berkeley study, the use of these AI-powered tools should give us pause^[3]:

• Hiring software by the company HireVue generates scores of job applicants based on their tone of voice and word choices captured during video interviews.
• Algorithms are being used to predict whether workers will quit, become pregnant, or try to organize a union, which influence employers’ decisions about job assignment and promotion.
• Call center technologies are analyzing customer calls and nudging workers in real time to adjust their behavior, such as coaching them to express more empathy, pace the call more efficiently, or exude more confidence and professionalism.
• Grocery platforms like Instacart are monitoring workers and calculating metrics on their speed as they fill shopping lists.
• Robots, for example “smart cart” service robots in health care, are being used to transport materials (e.g., linens, meals, lab specimens) to other workers. Meanwhile, floor cleaning robots vacuum or scrub floors along a preset route programmed by workers, who also monitor and support their operation.
• In remote workers’ homes, AI software is being used to track computer keystrokes.

Recent Efforts to Regulate AI and ADSs

Over the last several years, the Legislature has considered a multitude of bills aimed at regulating AI and its use to ensure that the privacy rights of Californians continue to be protected. AB 2885 (Bauer-Kahan, Chapter 843, Statutes of 2024) was a crucial first step in regulating this technology. AB 2885 established key definitions, including a uniform definition for “artificial intelligence,” “automated decision system,” and “high-risk automated decision system.”

Other efforts attempted to regulate the industry by establishing requirements on the use of AI, although the focus was mostly on consumers and their technology rights, whether it be the data social media companies collect and sell or the manipulation of elections news via fake postings. In the area of private sector labor and employment specifically, 2025 was the year where we saw several proposals attempting to regulate how AI-powered tools are used.

SB 7 (McNerney, 2025) attempted to regulate the use of ADS’ in the employment setting by, among other things, 1) requiring employers to provide a written notice that an ADS is in use at the workplace to all workers directly affected by the ADS; 2) prohibiting in some instances and in others limiting the use of an ADS, as specified; 3) providing worker anti-retaliation protections for exercising these rights; and 4) specifying enforcement mechanisms that included penalties and relief for violations. SB 7 was vetoed by Governor Newsom.

Several other bills attempted to regulate AI and ADS use last year, including AB 1018 (Bauer-Kahan, 2025, Pending on Senate Inactive File) which would, among other things, regulate the development and deployment of an ADS used to make consequential decisions, as defined. AB 1221 (Bryan, 2025, held in Assembly Appropriations Committee) attempted to regulate the use of workplace surveillance tools and an employer’s use of worker data by, among other things, requiring an employer to provide workers with a written notice regarding the need for the surveillance tool. Finally, AB 1331 (Elhawary, 2025, Pending on Senate Inactive File) would limit the use of workplace surveillance tools, including by prohibiting an employer from monitoring or surveilling workers in private, off-duty areas, as specified.

Federal WARN and Cal-WARN Notification Requirements

The federal WARN Act requires employers to provide written notice 60 days prior to a plant closing or mass layoff to employees, or their representative, the State dislocated worker unit (EDD, Workforce Services Division in California), and the chief elected official of local government within which such closing or layoff occurs. The federal WARN Act applies to employers with 100 or more full-time employees. Notices are required as follows:

• Plant closings involving 50 or more employees during a 30-day period.
• Layoffs within a 30-day period involving 50 to 499 full-time employees constituting at least 33% of the full-time workforce at a single site of employment.
• Layoffs of 500 or more are covered regardless of percentage of workforce. (29 USC, et seq., 2101 and 20 CFR 639.3)

Similarly, Cal-WARN requires employers to give a 60-day notice to the affected employees and both state and local representatives before a mass layoff, relocation, or termination. The Cal-WARN provisions apply to employers of 75 or more full-time and part-time employees. Notices are required as follows:

• For a plant closure affecting any amount of employees.
• Layoff of 50 or more employees within a 30-day period regardless of % of workforce.
• Relocation of at least 100 miles affecting any amount of employees.
• Relocation of a call center to a foreign country regardless of the percentage of workforce affected. [California Labor Code Section 1400.5 (d)-(f) and 1409 (b)]

Advance notification before a termination or layoff provides employees with necessary time to transition and adjust to the potential loss of employment, time to seek alternative employment and, if necessary, time to obtain skills training or retraining to successfully compete in the job market. Given the unprecedented way in which AI is transforming our economy, providing workers with advance notification before an AI displacement could grant workers this much needed time to adjust and transition to another job. This bill seeks to provide that extra time by requiring 90-day advance notification before any technological displacement can be implemented.

2. Need for this bill?

According to the author:

“Artificial intelligence is transforming our economy at an unprecedented pace. Unlike past technological advances, AI has the ability to automate entire occupations almost overnight, leaving workers vulnerable to sudden economic disruption. Employers are already citing AI as a reason for layoffs and hiring freezes, yet policymakers lack reliable data to understand the full impact. Without this information, government is forced to respond only after workers have already lost their livelihoods.

This bill requires employers to provide written notice to workers and the California Department of Employment Development (EDD) before conducting mass layoffs driven by the development of AI. It builds on the existing California Worker Adjustment and Retraining Notification (WARN) Act by adding notification of layoffs caused by technology. It also provides the state with data on the impact of artificial intelligence on layoffs, reductions in hiring caused, or other technological disruptions to help prevent economic dislocation and harm to workers and communities.”

3. Proponent Arguments:

The sponsors of the measure, the California Federation of Labor Unions, write:

“According to the Challenger Jobs Report that tracks workforce trends, 2023 was the first year that companies cited artificial intelligence as a reason for layoffs. Since then, AI was cited as the cause of close to 72,000 job cuts, with 55,000 AI-related layoffs in 2025 alone. Amazon, Dow Chemical, Accenture, Dell, Intel, Microsoft, TCS, UPS, and Citigroup all announced tens of thousands of AI-related job cuts in 2025. Salesforce laid off 4,000 customer support staff and froze hiring lawyers or software engineers, stating that AI now does up to 50% of the work of the company. In February 2026, CEO Jack Dorsey of Block and Square payments announced that he was laying off 4,000 workers, about 40% of the entire workforce, stating explicitly that the company would use AI to automate work.

Generative AI developers OpenAI and Anthropic have also released data on the far reach of their products. Anthropic analyzed the use of their AI tool, Claude, showing that 43% of usage was to automate tasks. OpenAI’s report attempts to evaluate the impact of AI tools on 44 occupations in the top nine sectors contributing to U.S. Gross Domestic Product (GDP). The jobs range from lawyers and accountants to sales reps, nurses, social workers, and clerks. Their conclusion was that AI frontier models could complete many tasks of those 44 occupations 100 times faster and cheaper than humans.”

Furthermore, they argue that, “What makes AI different than other technologies or economic fluctuations is the scope, scale, and velocity at which it is sweeping the economy. Instead of automated assembly lines limited to factories, employers are using AI tools to automate tasks across broad swaths of the workforce in many industries all at once. Agentic AI has the ability to ostensibly plan, reason, and execute complex, multi-step tasks with minimal human intervention, poised to eliminate many human positions. Even if the abilities of AI tools are overstated or exaggerated, employers are adopting the technology anyway. When AI cannot do the work, the remaining workers must work harder and longer, intensifying the jobs that are left.

Policy makers cannot ignore the blaring alarm bells warning of massive economic upheaval and worker suffering. AI poses an existential threat to human workers, government revenue, and society. The first step to tackling the growing threat is to collect and use reliable, local data to inform policy responses and to support workers who are the canaries in the coal mine of AI. This bill is a small, but crucial first step to that process.”

In conclusion, they argue that SB 951 provides policy makers and the public with data on AI-related job loss. Given the broad impacts on AI on certain occupations, they argue that the advance notice gives workers and their communities time to prepare for a potentially extended unemployment and to retrain and reskill for new jobs.

4. Opponent Arguments:

A coalition of employer organizations, including the California Chamber of Commerce, are opposed to the measure arguing that “California’s economic growth depends on responsible adoption of new technologies that improve productivity and create new job opportunities. Policies that discourage modernization risk undermining job creation and limit economic opportunities for California workers.” Below is a summary of some of the coalition’s main arguments:

• SB 951’s overbroad scope regulates routine technology adoption rather than the mass layoffs that WARN notices are intended to cover: they argue that the bill applies even to temporary workers like contractors, who may be hired for limited durations of time and are quite different from full-time employees. They argue that the bill appears to apply even if positions are eliminated but the worker is transferred into a new position, meaning the requirements are triggered even if there are zero layoffs. Employers regularly adopt tools such as payroll automation, workflow platforms, and data analytics systems that assist employees in performing their duties more effectively or change the nature of an employee’s position.
• SB 951’s mandatory disclosure of proprietary technology information creates competitive harm: the bill’s requirement to disclose detailed information regarding the technology used in routine workforce decisions would compel disclosure of confidential proprietary business information that may include trade secrets, vendor relationships, internal operational strategies, or product development roadmaps. They argue that public disclosure of this information would create a substantial risk that competitors may gain insight into business strategy or technological capabilities, information that is unrelated to actual job loss.
• SB 951 creates a blanket prohibition on terminations within a 90-day period, even where misconduct has occurred: The bill provides that an employer with 100 or more workers cannot discharge a worker affected who receives a notice for 90 days. They argue that this prohibition fails to account for scenarios where an employer needs to terminate a worker for reasons other than the impending displacement and should account for that.
• SB 951’s “right to bid” is vague and can cause issues across the workforce: they argue that this requirement conflicts with the structure and purpose of Cal-WARN by transforming it into a retention and rehiring mandate. Coupled with the prohibition on discharge, they argue that these provisions limit employers’ ability to manage workforce performance or hire individuals with the specialized skills required when implementing new technologies. They also note that compliance problems may arise when requiring employers to simultaneously comply with overlapping but inconsistent requirements governing timing, employee eligibility, and job placement obligations. The result, they argue, is increased litigation risk, operational inefficiencies, and delayed adoption of productivity-enhancing technology.
• SB 951’s requirements should be more aligned with Cal-WARN: To ease the administrative burden of creating a brand new WARN statute and with the understanding that some actions may trigger notice requirements under both Cal-WARN and this new bill, they argue that there should be more alignment between the two statutes. For example, SB 951 should require 60-day notice like Cal-WARN; it should have the same employee threshold (75 or more employees); the content of the notice should be more closely aligned; and it should apply to employees only, not independent contractors.
• SB 951 creates significant litigation exposure and civil penalties and increases the cost of doing business: they argue that because the bill relies on vague causation standards, employers will face increased litigation risk and may be required to defend routine operational decisions regarding productivity tools, software implementation, or restructuring. Even worse, they argue that the bill would allow “third or uninterested parties” to file claims against the employer with the Labor Commissioner. Any speculative media article about a specific company’s use of technology will spur claims or threats of claims by non-employees. They cite a recent study, The Impact of PAGA on Business Viability and Employment Security-Comparing the Relationship Between PAGA Settlements and WARN Notice Issuance, which found that California businesses, including small businesses, paid approximately $823,710,861 in settlements in FY 2022–2023 in matters where WARN notices and PAGA claims overlapped.

There is additional opposition from local educational and local government agencies, including the California State Association of Counties and the Association of California School Administrators, who argue that the bill conflicts with well-established layoff notice and rehire statutory requirements in the education sector, as well as technology bargaining between other local government employers and employees. They request that the bill be amended to exempt local educational agency (LEA) employers and local government employers from the bill’s requirements. Below is a summary of their opposition:

• Because independent contractors are included in the definition of “worker,” cities, counties, school districts and special districts would have to provide employees of a private company backpay and other benefits if proper notice is not given.
• SB 951 creates processes that are likely better suited for private labor practices and does not fit schools serving TK- 12 grade levels or local government employers. First, for school employers, SB 951 would create a bifurcated system of layoff notice procedures outside the well-established March 15 layoff notice process that applies to both certificated and classified positions.
• Further, the rehire procedures in SB 951 could bump other school employees from their return-to-work rehiring rights in existing collectively bargained agreements (CBA) and existing Education Code statutes. Currently, LEAs have rehire policies that provide 39 months of return rights to the same classification, without losing seniority, for individuals who have been laid off (due to budget constraints or reduced levels in service needs) or have exhausted their medical leave. This practice includes job notifications for positions they are qualified for, and opportunities are offered based on seniority. Seniority is also used to determine job offers when there is more than one qualified candidate. Job notifications are provided to individuals on the rehire list based on the format determined by a CBA.
• For public employers with represented workforces, the use of technology tools is often bargained between employees and public employers based on local conditions, security needs, and the concerns of the public workforce. State law already prohibits local public employers from using workplace technology tools to deter or discourage union membership and because of this, they have concerns regarding the likelihood of overlapping or conflicting requirements introduced by this bill that will create uncertainty and liability for local agencies.

5. Staff Comments:

As noted above, AI is being used in new ways not previously contemplated in current law.

Advance notification before a termination or layoff has proved effective in providing employees with time to transition and adjust. This bill seeks to provide that time by requiring advanced notification before an AI displacement and provides critical protections during this transition. Below are a couple of thoughts and questions for consideration on the proposal.

• As noted above, the Cal-WARN and federal WARN Act provisions include the same 60-day notification period but apply to employers of different sizes. Cal-WARN applying its provisions to employers of 75 or more full-time and part-time employees, while the federal WARN applies to employers with 100 or more full-time employees. This bill proposes a 90-day notification period and applies its provisions to employers of any size, except for the right of first bid and prohibition on discharge provisions which apply to employers of 100 or more workers.

Since AI tools are being developed for all aspects of work and could be utilized by employers of all sizes, it makes sense to apply these requirements to all employers. However, considering the challenges faced by smaller employers and their limited HR capabilities, and consistent with the Cal-WARN and federal WARN applying to larger employers, should the bill have an employer size threshold for its provisions and what size should that be?

• Section 1414.2 (e) of the bill prohibits an employer with more than 100 workers from discharging a worker affected by a technological displacement during the 90-day period from when the notice is provided to the worker. Should this prohibition apply only to large employers? The author has indicated that the intent is to apply this prohibition to employers of all sizes and remove the 100 workers reference.

As noted by the opposition, this provision of the bill fails to account for scenarios where an employer needs to terminate a worker for reasons other than the impending displacement, such as when a worker violates a company policy or engages in misconduct. Should the bill include provisions accounting for firing with cause during this 90-day window?

Finally, there are some errors in the bill that, should the bill move forward, should be corrected. Below is a summary of those needed corrections:

• Recent amendments removed previous application of the bill’s provisions to a “terminations of contract.” The amendments missed a couple sections where the “termination of contract” provisions remain. The author may wish to remove this term from the following sections of the bill: 1414.2 (b)(2), 1414.2 (e), 1414.6 (d).
• Section 1414.3 (c) of the bill, prescribing what the hiring disruption notice must include, under (8) and (9) requires “A statement if the cessation resulted in hiring or creation of other employment position in the company and the number and occupation of those positions.” (8) and (9) are the same statement. The author may wish to remove (9).

• Due to the recent amendments, it appears that some cross references are no longer aligned. Section 1414.6 (d) currently references liability pursuant to 1414.4, but that section no longer specifies liability provisions. The author may wish to correct the cross references in this section.

6. Double Referral:

This bill has been double referred and if approved by this Committee today, will be sent to Senate Privacy, Digital Technologies, and Consumer Protection Committee for a hearing.

7. Prior/Related Legislation:

SB 947 (McNerney, 2026), among other things, 1) prohibits an employer from using an ADS that does certain functions and would limit the purposes and manner in which an ADS may be used to make disciplinary, termination, or deactivation decisions; 2) requires an employer to provide a written postuse notice when an employer has used an ADS, as specified; 3) includes worker anti-retaliation provisions for exercising these rights; and 4) specifies enforcement provisions including specified penalties and relief for violations. SB 947 is pending before this Committee.

SB 1248 (Cabaldon, 2026) would impose certain restrictions on the use of an ADS by a state agency to confer services, defined as, among other things, the issuance of professional licenses and provision of public benefits. Among the restrictions, the bill would include a prohibition on using an output from the system as the sole basis for an adverse service determination. The bill would require the state agency to verify the accuracy of the system’s outputs and to promote nondiscrimination in its use, as specified. SB 1248 is pending before the Senate Committee on Privacy, Digital Technologies, and Consumer Protection.

AB 1883 (Bryan, 2026) would regulate the use of workplace surveillance tools and an employer’s use of worker data. The bill would require the LC to enforce the bill’s provisions, would authorize an employee to bring a civil action for specified remedies for a violation, and would authorize a public prosecutor to also enforce. AB 1883 is pending before the Assembly Privacy and Consumer Protection Committee.