What employers should know about key developments this week:
- States Lead on Workplace AI: With federal regulators slowing new rules, individual states are setting their own requirements for employers that use artificial intelligence (AI), creating a patchwork for multistate workforces.
- California’s Executive Order: Governor Gavin Newsom issued an executive order (EO) targeting AI-driven labor market disruption and directing state agencies to recommend updates to California’s Worker Adjustment and Retraining Notification (WARN) Act for AI-related mass layoffs.
- Connecticut’s New AI Law: Beginning October 1, 2027, employers must give written notice to applicants and employees when AI substantially influences a hiring, promotion, discipline, or termination decision.
In this episode of Employment Law This Week®, Epstein Becker Green attorneys Courtney McFate and Elizabeth S. Torkelsen break down two state actions shaping AI in the workplace: California Governor Newsom’s EO on labor protections in the age of AI, and Connecticut’s new transparency and nondiscrimination requirements for employers.
Transcript
[00:00:03] George Whipple: Welcome to Employment Law This Week. I’m George Whipple. Artificial intelligence is top-of-mind for many employers, and for the agencies that regulate them. On the federal level, we’re seeing a marked slowdown in new regulations, with the administration aggressively pursuing a de-regulatory, innovation-first approach.
[00:00:29] George Whipple: Meanwhile, state governments are experimenting with many different approaches to regulating AI, some that directly impact employers. In order to help employers track the fast-moving regulatory landscape, Epstein Becker Green has published a state-by-state map highlighting the legal landscape for AI. Today, we take a look at two of these state-level initiatives.
[00:00:56] George Whipple: First, Epstein Becker Green’s Courtney McFate tells us about California Governor Gavin Newsom’s “first-of-its-kind” executive order on labor protections in the age of AI. The executive order doesn't create immediate new compliance obligations for employers, but it previews where state policy and regulation and enforcement may be headed in California.
[00:01:22] Courtney McFate: This order is different because it focuses on anticipating and mitigating labor market impacts rather than regulating the AI systems directly. It's essentially the first US state executive order to frame AI workforce disruption as an imminent coordinated policy emergency, basically treating it the way the states treat disaster preparedness rather than a vague future concern.
[00:01:43] Courtney McFate: Also, it mandates specific agencies to report on AI labor market research statistics and produce recommendations on updating WARN obligations for AI-driven mass layoffs. This is a first, because no state has previously directed a review of mass layoff notification laws through the specific lens of AI automation and displacement.
[00:02:03] George Whipple: Moving across the map to Connecticut, we now turn to Epstein Becker Green’s Liz Torkelsen to take us through that state’s sweeping new AI law, which includes transparency and non-discrimination requirements for employers.
[00:02:19] Liz Torkelsen: Connecticut recently joined a number of states in requiring more transparency in employers' use of AI in the workplace, specifically automated employment-related decision technology.
[00:02:30] Liz Torkelsen: Starting October 1, 2027, employers must provide a written notice to applicants and employees whenever they are using AI to process an individual's personal data to generate any kind of output that's going to be a substantial factor or will materially influence an employment-related decision, such as hiring, promotion, discipline, termination, or training.
[00:02:52] George Whipple: For any action alleging discrimination involving these tools, Connecticut courts may also consider anti-bias testing as evidence of compliance. A good reminder that annual bias audits are a best practice for employers using workplace AI tools, even when audits are not legally required. Tell us, Liz, what makes Connecticut’s law unique?
[00:03:19] Liz Torkelsen: Connecticut's law actually imposes some shared responsibility for compliance with the new law on developers of the automated employment-related decision technology. The law requires developers to provide employers with the information that they need in order to comply with the notice requirements.
[00:03:36] George Whipple: The law also imposes new reporting requirements on Connecticut employers when a layoff triggers the federal WARN Act.
[00:03:45] Liz Torkelsen: Those employers must provide a written notice to the Connecticut Department of Labor disclosing whether the layoffs are related to the employer's use of artificial intelligence or other technology.
[00:03:56] George Whipple: Thanks, Liz and Courtney. And thank you for watching. Don’t forget to check out our state-by-state AI legislation tracker. We’ll see you next time.
In Case You Missed It
AI Legislation: Interactive Map by Epstein Becker Green
Minimum Wages Adjusted Across the USA, Wage and Hour Defense Blog
Virginia Pay Transparency Requirements Take Effect July 1, 2026, Workforce Bulletin
Hemant Gupta Bridges the Gap Between Cutting-Edge Technology and Intellectual Property Protection
For technology and life sciences companies racing to innovate, protecting intellectual property (IP) can feel like an afterthought—until it isn't. Whether it's code generated by artificial intelligence (AI) with murky ownership rights or a prototype built without the proper licenses, the pitfalls are real, and the stakes are high.
About Employment Law This Week
For employers navigating risk, workforce, and the bottom line. Employment Law This Week® delivers the employment and labor developments that matter—without the noise. Part of the Epstein Becker Green Insights Network.
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