California employers will have to identify technology-driven job losses in certain advance layoff, closure and relocation notices under SB 951, a newly enacted amendment to the California Worker Adjustment and Retraining Notification Act. Signed by Gov. Gavin Newsom on September 30, the law takes effect January 1, 2027, and requires employers to explain which positions and job functions are being displaced by artificial intelligence or other automated technology.
The requirements attach to an already-required Cal-WARN notice when technology replacing or automating employment positions causes a covered workforce action entirely or contributes substantially to it. Introducing AI into a workplace does not, by itself, trigger the notice obligation. The law instead connects the additional disclosures to the technology’s role in a qualifying mass layoff, relocation or cessation of operations.
Cal-WARN generally covers industrial or commercial facilities, including parts of facilities, that employ at least 75 people or have employed that many at any point during the preceding 12 months. A mass layoff involves at least 50 employees within a 30-day period. A covered relocation moves all or substantially all operations at least 100 miles, while a termination means the cessation or substantial cessation of operations at a covered establishment—not an individual employee’s firing.
SB 951 retains the existing 60-day advance-notice framework. Its enacted requirements do not include the 90-day notice period or the lower, 25-worker or 25%-of-workforce thresholds found in earlier proposals. Nor does the final law establish a separate notice requirement for an employer’s decision to stop hiring because of automation.
For a qualifying technology-related workforce action, the notice must identify the number of layoffs substantially attributable to AI or other automation, along with the affected classifications or occupations and work locations. These details distinguish the technology-displaced jobs within a workforce reduction rather than simply announcing that automation played some role in the business decision.
Employers must also describe the affected workers’ job functions that will be automated and identify the specific category or type of AI system or other technology responsible for the displacement. The disclosures therefore address both the positions affected and the work being transferred to technology. At the top of the notice, SB 951 requires this statement:
This notice is for a technology displacement.
The statute’s definition of AI encompasses machine-based systems with varying degrees of autonomy that infer from inputs how to generate outputs capable of influencing physical or virtual environments. The disclosure requirement also expressly reaches other automated technology, so its scope is not limited to generative AI tools or products marketed as artificial intelligence.
The additional information goes to the same recipients as the underlying Cal-WARN notice: affected employees, the Employment Development Department, the local workforce development board and the relevant city or county chief elected officials. Existing Cal-WARN consequences can include liability for employee back pay and benefits, as well as civil penalties of up to $500 for each day of a notice violation.
The law also creates a public reporting channel for the displacement information. The Employment Development Department must publish summaries of the technology-displacement notices it receives and provide quarterly statewide summaries. By January 1, 2028, it must submit a legislative report examining AI’s effects on business hiring practices, including impacts across industries and occupations at the state and regional levels.
Sources: Ogletree, The National Law Review, Daily Journal, Morgan Lewis, National Law Review – AI