California lawmakers are considering two bills that would significantly reshape how employers use artificial intelligence in employment decisions. Introduced yesterday, the proposals—backed by the California Labor Federation—aim to address potential job losses stemming from increased automation. The bills take a two-pronged approach: mandating human oversight in disciplinary and termination decisions made with AI assistance, and requiring extended notice periods for mass layoffs driven by AI or automation.
“No Robo Bosses” Act Returns
State Senator Jerry McNerney’s SB 947, a revised version of legislation vetoed by Governor Gavin Newsom last year, would prohibit employers from relying solely on “automated decision systems” (ADS) when discharging or disciplining employees. The bill defines ADS broadly as any computational process—including those using machine learning—that makes or facilitates employment decisions.
What’s Changed
The 2026 version of SB 947 addresses some of Governor Newsom’s previous concerns. The requirement for advance notice before deploying AI systems has been removed, but retroactive notice is now required after an AI system is used in a disciplinary or termination decision. A new restriction prohibits the use of ADS systems that attempt to predict employee behavior, such as forecasting performance or identifying potential misconduct. However, the core requirement for a “natural person” to make the final decision in these cases remains.
90-Day Notice for AI-Driven Layoffs
Companion bill SB 951, introduced by State Senator Eloise Gómez Reyes, focuses on mass layoffs resulting from automation. It would amend California’s existing Worker Adjustment and Retraining Notification (Cal-WARN) Act, requiring 90 days’ advance notice for layoffs “due to the use of artificial intelligence or automation”—30 days longer than the standard requirement.
The bill also lowers the threshold for triggering the notice requirement to 25 affected workers, or 25% of the workforce, and grants employees at companies with 100 or more employees the right to bid on available positions during the notice period. Employers would also be required to report AI-driven layoffs to the California Employment Development Department.
What This Means for Employers
If enacted, these bills would require California employers to conduct thorough audits of their AI systems. This includes applicant tracking systems, performance management platforms, and workforce analytics tools. Employers would need to document human review of AI recommendations and establish procedures for overriding automated decisions. Retroactive notice would be required when AI is used in disciplinary or termination decisions, potentially complicating related proceedings.
Furthermore, employers planning AI-driven layoffs would face extended planning timelines and increased reporting obligations. The 90-day notice requirement could present competitive challenges, and the state database of automation-related job losses could provide valuable data for policymakers.
The Path Forward
The fate of these bills remains uncertain. While the California Labor Federation is prioritizing these measures, they are likely to face opposition from the tech industry. Governor Newsom has previously resisted “overregulating” AI, but the revised SB 947 addresses his previous concerns. Additionally, the bills may face legal challenges, as the Department of Justice may attempt to preempt state regulation of AI, and President Trump is pushing for a national standard.
Frequently Asked Questions
What is an “automated decision system” as defined by SB 947?
The bill defines an “automated decision system” (ADS) as any “computational process, including one derived from machine learning, statistics, or other data processing or artificial intelligence techniques, that makes a decision or facilitates human decision making.”
What is the notice requirement for AI-driven mass layoffs under SB 951?
SB 951 would require employers to provide 90 days’ advance notice before conducting mass layoffs “due to the use of artificial intelligence or automation.”
Does SB 947 require employers to eliminate AI from employment decisions?
No, SB 947 prohibits employers from using ADS as the sole basis for discharge or discipline decisions. A “natural person” must still make the final decision.
How will these proposed laws impact the future of work in California and beyond?
