Often, yes — if you signed an agreement that requires it — but a growing number of states now restrict these “stay-or-pay” deals, many agreements must be prorated, and how you left (quit, fired, laid off) can change the answer. Before you pay, check the agreement, your state’s rules, and whether you’re being asked for the gross or net amount.
Jump to the repayment estimator to see a rough number before you read on.
And the question almost nobody asks HR: are you asking me to repay the gross bonus when I only received the net?
Sign-On Bonus Repayment Estimator
This tool does arithmetic and points you to the rules that may matter. It stores nothing and sends nothing anywhere. It cannot tell you whether your agreement is enforceable.
How Sign-On Bonus Repayment Clauses Work
A sign-on bonus is usually paid up front. The agreement then says you must pay some or all of it back if you leave before a set date. Lawyers call these “stay-or-pay” terms. When the money was for training, you may see the term TRAP, short for training repayment agreement provision. Relocation payments often work the same way.
The clause may sit in your offer letter, in a separate bonus agreement, or in a relocation or training agreement. Where it sits matters, because some state rules require a separate agreement with specific notices. A typical clause answers five questions:
- How long you have to stay (the retention period, often 12 or 24 months).
- What triggers repayment (resigning, any departure, or only termination for misconduct).
- How much you owe (the full amount or a prorated share).
- Extras such as interest, collection costs, or attorney’s fees.
- How they collect (a demand letter, a paycheck deduction, an offset, a collections referral, or a lawsuit).
This article uses three labels to show how much certainty a situation carries. They describe a typical starting point, not a verdict on your case:
- LIKELY ENFORCEABLE The clause is clear, you signed it, and no state rule obviously stands in the way. You may still have arguments, but expect the employer to insist.
- LIMITED BY STATE LAW A state statute restricts or reshapes what the employer can demand. The details, including the date you signed, decide how far the limit goes.
- CHECK THE DETAILS The answer turns on the wording of your agreement or the facts of how you left.
Quit vs. Fired vs. Laid Off
Read the trigger language before anything else. Many clauses are written around resignation. Others say “any termination of employment,” which would sweep in a layoff. Some carve out termination without cause. The words in your agreement decide, unless a state law overrides them.
| How you left | Typical clause effect | What to check |
|---|---|---|
| You quit | LIKELY ENFORCEABLE Resignation is the most common trigger. | Prorating, your state’s rules, and the date you signed. |
| Fired for misconduct | CHECK THE DETAILS Often a trigger, but only if the clause says so. | How the agreement defines “misconduct” or “cause,” and what the employer actually documented. |
| Fired without cause | CHECK THE DETAILS Many clauses do not apply; some do. | Whether the trigger says “any termination” and whether your state limits that. |
| Laid off | CHECK THE DETAILS Depends on the wording; see the note below for California. | The trigger language, any severance terms, and your state’s rules. |
LIMITED BY STATE LAW Where California’s AB 692 applies to your agreement, its sign-on bonus exception only allows repayment triggered by your own choice to leave or by termination for misconduct. A clause that demands repayment after a layoff or a no-cause firing falls outside that exception. Whether AB 692 reaches your agreement depends on the date you signed — see the California section.
If you were let go and also received a severance offer, read it before you sign. Severance agreements sometimes address bonus repayment or release claims. Our guide Should You Sign a Severance Agreement? walks through what to look for.
Full vs. Prorated Repayment
A prorated clause asks you to repay only the part of the bonus tied to the time you did not stay. A full-repayment clause asks for everything if you leave before the finish line, even one day early. Some states require proration for at least some kinds of repayment, and some agreements prorate even where the law does not require it.
The basic math for a monthly prorated clause is the unearned months divided by the retention months, times the bonus. For example, on a $12,000 bonus with a 24-month retention period, leaving after 9 months leaves 15 unearned months. That is 15 divided by 24, or 62.5 percent, so a prorated clause would ask for $7,500. A full-repayment clause would ask for $12,000.
Points that change the number:
- The start date. Does the retention period begin on your hire date, the date you signed, or the date you were paid?
- Partial months. Some clauses round up, some count days, and some ignore partial months.
- Other schedules. Some clauses drop the amount in steps (for example, 100 percent in the first year and 50 percent in the second) rather than month by month.
- Interest and fees. Some agreements add them; some state rules prohibit interest on covered bonus repayments.
Use the estimator above to compare the full and prorated numbers.
Gross or Net? The Tax Side of Paying It Back
Gross or net? Ask before you pay.
Contracts usually say you must repay the bonus amount, and that amount is normally the gross figure — before taxes came out. What landed in your bank account was smaller. Ask HR in writing exactly which number they are demanding and how they will treat the payroll taxes.
Here is a simple illustration with made-up numbers. Suppose you were paid a $10,000 gross bonus. Employers often withhold federal income tax on bonuses at a flat supplemental rate (22 percent is common), plus Social Security and Medicare (7.65 percent combined) and any state tax. Roughly $2,200 federal, $765 payroll tax, and $500 state would leave about $6,535 in your pocket. If your agreement calls for repaying the full $10,000, you would be sending back about $3,465 more than you kept. Your own withholding will differ. For how bonus withholding works, see How Are Bonuses Taxed?
The tax rules below are how part of that withheld tax may come back to you. They are not a promise that you will recover all of it, and the outcome depends on your situation.
| When repaid | Amount | What may apply |
|---|---|---|
| Same calendar year you received it | Any amount | The employer can generally adjust the wages and withholding it reports for that year, so the bonus is not treated as income you kept. Ask HR how they will handle payroll and your wage statement. |
| A later year | More than $3,000 | IRC §1341 (the “claim of right” rule) may let you take a deduction or a credit for the year you repay, whichever results in lower tax. See IRS Publication 525. |
| A later year | $3,000 or less | Under current law, there is generally no federal deduction for a repayment of wages at or below this level. State tax treatment varies. |
| A later year (Social Security and Medicare) | Any amount | Recovering the payroll taxes on prior-year wages follows separate procedures, such as an employer refund with a corrected W-2 or, in some cases, IRS Form 843. Additional Medicare Tax has its own rule in Publication 525. |
Two practical points. First, keep proof of the repayment, your original W-2 or pay stub showing the bonus, and the return for the year you received it. You will need them if you claim a deduction or credit. Second, the §1341 credit works by recalculating your earlier-year tax without the repaid income, so the result depends on what your tax rate was then and now. A tax professional can run both methods for you.
Sources for the table: IRS Publication 525 (Repayments), 26 U.S.C. §1341, and IRS Publication 15.
Can They Take It From Your Final Paycheck?
A deduction from your final paycheck may need your written OK.
Do not sign a payroll-deduction authorization just because HR hands you one on your last day. Read what it covers first.
Federal law offers limited protection here. The Fair Labor Standards Act mainly limits deductions that push your pay below minimum wage or cut into required overtime. Most of the rules about what can come out of final pay are set by state law, and many states require your written authorization for deductions. Some go further.
Two examples, both worth confirming before you rely on them:
- California. Labor Code sections 221 and 224 tightly limit deductions from wages. California labor authorities and courts have treated taking a debt out of final wages as improper self-help, even where the worker signed something. See the state labor department’s deductions FAQ.
- New York. Labor Law section 193 allows only specific kinds of deductions. Employee-authorized deductions generally must be voluntary, in writing, and for the employee’s benefit. See Labor Law §193.
Other states differ, and some are more permissive when the agreement is clear and signed. If your state labor department has a page on wage deductions, read it. For unpaid wages or an unauthorized deduction, our guide Wage and Hour Lawyer: Recover Unpaid Wages explains your options. Whatever the rules are, an employer taking money from your last check does not settle whether you owe the underlying amount, and the reverse is also true.
Training Costs and TRAPs
Training repayment clauses ask you to pay back what the employer spent on your training if you leave within a set period. They are more contested than sign-on bonus clauses because the cost can be hard to verify and the training may only help you at that employer. Regulators have described these arrangements as employer-driven debt.
The questions that tend to matter:
- Is the training transferable? A credential other employers recognize is treated differently from training that only makes sense at one company. Colorado and New York draw this line in their statutes.
- What did it actually cost? Is the employer asking for its real out-of-pocket cost, or a stated “value” that may be higher?
- Does the amount shrink over time? Several states require proportional reductions.
- Was it required for the job? Training you must complete to do the work is viewed differently from optional education.
- Did it cut into your pay? Repayment or deductions that reduce wages below minimum wage raise separate issues under federal and state law.
State Snapshot (Verified Only)
| State | Status | Applies to agreements signed | Key limit |
|---|---|---|---|
| California | AB 692 in effect since January 1, 2026. AB 1697 awaits governor action (deadline September 30, 2026). AB 1697 signed [INSERT DATE]. AB 1697 vetoed [INSERT DATE]. | On or after January 1, 2026 if AB 1697 is vetoed; on or after January 1, 2027 if it is signed. On or after January 1, 2027. On or after January 1, 2026. | Repayment terms are void unless they fit a narrow exception. The sign-on bonus exception has strict conditions, including proration, a retention period of two years or less, and no interest. |
| New York | Trapped at Work Act signed December 19, 2025; amended February 13, 2026. | Effective December 19, 2026 per the current statute text (some law-firm alerts read a later date; verify). Application to earlier agreements is unclear. | Bars requiring an “employment promissory note” as a condition of employment, with limited exceptions such as certain transferable credentials. |
| Colorado | HB22-1317 in effect (2022). | Colorado workers under current law. | Training repayment allowed only for distinct, transferable training; limited to reasonable cost; reduced proportionally over up to two years. |
| Washington | ESHB 1155 signed March 23, 2026. | Effective June 30, 2027. | Broad noncompete ban that also reaches repay-or-forfeit terms tied to competing. Allows written repayment of out-of-pocket educational expenses only within tight limits. |
California: AB 692 and AB 1697
California’s rules changed again in 2026 — check the date you signed.
Which California rules apply to your agreement can turn on a single date. Find the date on the signed agreement before you read further.
What AB 692 does
LIMITED BY STATE LAW AB 692 took effect January 1, 2026 (Business and Professions Code section 16608 and Labor Code section 926). It broadly prohibits contract terms that require a worker to pay an employer, a training provider, or a debt collector when employment ends. Terms that violate it are void. A worker can sue for actual damages or $5,000 per worker, whichever is greater, plus an injunction and attorney’s fees.
The law has narrow exceptions, including approved apprenticeships, certain tuition for transferable credentials in a separate agreement, and sign-on bonuses that meet all of these conditions:
- The repayment terms are in a separate agreement.
- You received written notice of your right to consult an attorney and at least 5 business days to review it.
- Repayment is prorated over a retention period of no more than two years.
- No interest is charged.
- You had the option to defer receiving the bonus until the end of the retention period.
- Repayment is triggered only by your own choice to leave or by termination for misconduct.
If a clause misses any one condition, it does not fit this exception. Whether a specific clause fits depends on its exact terms, and an employment attorney or the Labor Commissioner’s office can review yours.
What AB 1697 changes
AB 1697 is an urgency bill that moves the date AB 692 applies to agreements from January 1, 2026 to January 1, 2027, and adds new exceptions. Those include contracts tied to grant-funded recruitment and retention programs, repayment of advanced paid time off after a voluntary separation, and certain securities and insurance affiliation agreements. It may also extend the sign-on bonus exception to certain later-paid bonuses.
IF SIGNED — AB 1697 was signed. AB 692’s restrictions apply only to agreements entered into on or after January 1, 2027. For an agreement you signed in 2026, AB 692’s void-term rule and worker remedies no longer reach it. That is not a finding that you owe the money; your contract, other California wage and contract law, and how you left still matter. Open questions remain, such as how the law treats a 2026 agreement that is later amended. Agreements signed on or after January 1, 2027 are covered by AB 692 as amended, including the new exceptions.
CHECK THE DETAILS for 2026 agreements. LIMITED BY STATE LAW for agreements signed from 2027 on.
IF VETOED — AB 1697 was vetoed. AB 692 continues to apply to agreements entered into on or after January 1, 2026, without the new exceptions AB 1697 would have added. For a covered agreement, a repayment term is void unless it fits an exception, and the sign-on bonus exception above is strict. Agreements signed before 2026 are not covered by AB 692, though other California protections may still apply.
LIMITED BY STATE LAW for agreements signed on or after January 1, 2026. CHECK THE DETAILS for earlier agreements.
Until the governor acts, the safest reading is to treat both outcomes as possible. Both blocks above describe what each would mean for you. Pull out your signed agreement and note whether it was signed in 2025 or earlier, in 2026, or in 2027 or later.
Where to check: California Legislative Information shows the final status of AB 692 and AB 1697. For a pay dispute, the California Labor Commissioner’s office handles wage claims.
New York’s Trapped at Work Act
LIMITED BY STATE LAW New York’s Trapped at Work Act (Labor Law Article 37) was signed December 19, 2025 and amended February 13, 2026. It prohibits employers from requiring an “employment promissory note” as a condition of employment. The law defines that as an agreement or contract provision requiring an employee to pay the employer money if they leave before a stated period. As amended, it has narrow exceptions, including certain transferable credentials and property an employer voluntarily sold or leased to the employee, along with a few others such as certain payroll advances.
Three points for workers:
- Effective date. The amendment changed the effective date to “one year after it shall have become law.” The current statute text points to December 19, 2026. Some law-firm alerts read the date as February 13, 2027, so confirm on NYSenate.gov.
- Older agreements. It is unclear whether the act voids agreements signed before it takes effect. Do not assume either way.
- Enforcement. The state labor commissioner can act on complaints and impose civil penalties. Reports on the amended law also indicate that a worker who successfully defends an employer’s suit on a void note may recover attorney’s fees; verify that in the statute text.
Colorado
LIMITED BY STATE LAW Colorado’s HB22-1317 (2022) is aimed at noncompetes but also sets the terms for training repayment in C.R.S. section 8-2-113. An employer may recover the expense of training a worker only if the training is distinct from normal on-the-job training and meets any transferability standards set by the attorney general. Recovery is limited to the reasonable cost of the training and must decrease proportionally over the two years after the training, and it cannot violate the federal Fair Labor Standards Act. Employers who violate the statute can face actual damages, fees, and penalties of up to $5,000 per affected worker, with room for a court to reduce penalties for good-faith conduct.
The training rules address training costs. They do not spell out a rule for an ordinary sign-on bonus, so a bonus clawback may raise other Colorado questions about wage protections. If your repayment demand is about training, compare it to the four limits above: distinct, transferable, reasonable cost, and reduced over time. Wording is on the Colorado General Assembly page for HB22-1317.
Washington
CHECK THE DETAILS Washington signed ESHB 1155 on March 23, 2026, amending its noncompetition statute (RCW 49.62). It takes effect June 30, 2027. Until then, the earlier version of the statute (with its earnings thresholds) continues to apply.
The new law is a near-total ban on noncompetes, and its definition also reaches provisions requiring a worker to return, repay, or forfeit compensation because of engaging in a lawful profession, trade, or business. It expressly allows written agreements to repay out-of-pocket educational expenses only if the agreement expires within 18 months of the start date, limits repayment to the pro-rata share of the remaining period, and releases you from repayment if you separate for “good cause” under Washington’s unemployment insurance rules.
What is not settled: the amendment is written around restraints on competing, and reports on it do not say that it directly governs an ordinary sign-on bonus with no competition restriction. Separate Washington wage-deduction rules also apply to anything taken from your pay. Read the current text at RCW 49.62 and check the effective date against your situation.
Nurses, Truck Drivers, Pilots, Pet Groomers
Training repayment clauses show up wherever employers pay for credentials or run their own training. These are patterns people report, not rules. Your agreement and state law decide.
- Nurses. New-graduate residency and orientation programs sometimes come with a repayment term, often prorated over roughly two years. Ask what the program actually cost, whether the credential is portable to another hospital, and whether the term applies if the employer ends your job.
- Truck drivers. Some carriers advance CDL school costs or run in-house training and expect repayment if a driver leaves within a set period. Because pay can be low or per-mile, repayment through deductions can raise minimum wage questions. Check how the deductions are structured and whether the company treats you as an employee.
- Pilots. Type ratings and airline training can cost a lot, and some agreements require repayment if a pilot leaves early. A recurring question is whether the training is transferable to other airlines, which is the same test some state laws use.
- Pet groomers. Groomers may sign training or apprenticeship repayment terms with salons or chains. In-house training that mainly benefits one employer can be hard to fit into a “transferable credential” exception, and repayment out of low wages can raise deduction issues.
CHECK THE DETAILS in each case: the cost, the trigger, the proration, and the law of the state where you work.
Real Example: HCA and Nurse Training Debt
On July 24, 2025, the California Attorney General announced a settlement with HCA Healthcare and its subsidiary HealthTrust Workforce Solutions over training repayment agreements used with new nurses in its StaRN residency program. The investigation was led by the attorneys general of California, Colorado, and Nevada, working with the federal Consumer Financial Protection Bureau.
According to the attorney general, nurses hired through the program had to agree to repay a prorated portion of the program’s stated “value” if they did not work for HCA for two years, and some of those debts were sent to collections. The combined penalties across the three states came to $2.9 million. In California, the settlement included about $83,000 in restitution for nurses who had already paid, cancellation of about $288,000 in outstanding debt, and a bar on using these agreements with nurses.
What it means for you: regulators are treating some training repayment terms as unlawful debt, and a debt sent to collections is not necessarily a valid one. What it does not mean: a settlement is not a court ruling that every repayment clause is unenforceable. Your own situation turns on your agreement and your state. Source: California Attorney General press release, July 24, 2025.
HR Sent a Repayment Demand — What Now?
A demand is a request, not a court judgment. It is also not something to ignore. Deadlines and consequences vary, so take these steps calmly and in order:
- Note the deadline and read the whole demand. See whether it names an amount, a date, and the contract provision.
- Find your signed agreement. If you do not have a copy, ask for one.
- Do not agree to a paycheck deduction or payment plan yet. Do not sign new paperwork until you have compared it to your agreement and your state’s rules.
- Respond in writing. A short request for documents and a calculation keeps a record and does not admit anything. A copy-ready letter is below.
- Keep everything. Save the demand, your reply, pay stubs, and any messages about the bonus.
- Get advice if the amount is large or the state rules apply. Your state labor department or an employment attorney can review the agreement.
If the debt has been sent to a collector, a third-party collector must follow federal debt collection rules, including sending a validation notice you can dispute in writing. See Debt Collector Rights. If the demand arrived alongside a termination or severance offer, see Should You Sign a Severance Agreement?
Copy-ready response letter
Fill in the brackets and adjust the deadline to match any date in the demand.
[Your name] [Your address] [Date] [HR contact name, company name] Re: Your [date] request for repayment of [sign-on bonus / relocation / training] payment Hello [name], I received your [email/letter] dated [date] asking me to repay [amount]. So that I can review it, please send me the following: 1. A complete copy of the signed agreement you are relying on, showing the date it was signed. 2. The specific provision you say requires repayment and the event you say triggered it. 3. Your calculation of the amount, including the dates used, the retention period, and any proration. 4. Whether the amount is the gross amount paid to me or the net amount I received after taxes and withholding, and how you will handle any payroll tax adjustments and corrected wage statements if an amount is repaid. 5. Any interest, fees, or costs included in the amount, and the basis for each. 6. The legal basis you rely on under the law of [state], including how it applies given the date the agreement was signed. 7. Whether this amount has been or will be referred to a collection agency, and confirmation that no amount will be deducted from my wages without my separate written authorization and applicable law. This letter is a request for information. It is not an agreement that any amount is owed, and I am not waiving any rights. Please respond in writing by [date]. Thank you, [Your name]
8 Things to Check Before You Pay
- The signature date. New state rules often depend on it.
- Where the clause lives. Separate agreement, offer letter, or relocation or training document.
- The trigger. Resignation only, any departure, or misconduct only.
- The schedule. Full or prorated, and how months are counted.
- The amount. Compare it to what you actually received, gross versus net.
- Extras. Interest, fees, collection costs, or attorney’s fees.
- The method. Whether they plan to deduct from your pay and whether you authorized it in writing.
- Your state. California, New York, Colorado, and Washington have specific rules; other states may limit deductions or interest.
What This Isn’t
This guide covers repayment of sign-on bonuses, relocation money, and training costs. It is not about noncompete or non-solicit agreements that limit where you can work next; for that, see Are Non-Competes Enforceable in 2026? It is not advice for employers on writing or enforcing these clauses. It is not a legal determination about your specific agreement, and it is not tax advice. For disputes, contact your state labor department or an employment attorney. For tax questions, ask a tax professional.
FAQ
Do I have to pay back a sign-on bonus if I quit?
Often, if you signed an agreement that requires it. But the amount, whether it is prorated, and whether a state law limits it all depend on your agreement and where you work. Start with the five checks at the top of this page.
Do you have to pay back a signing bonus if you are fired?
It depends on the trigger language. Termination for misconduct is often a trigger. Termination without cause is often not, but some clauses cover any termination. Where California’s AB 692 applies, repayment is limited to your own choice to leave or termination for misconduct.
What about sign-on bonus repayment if you are laid off?
Read the trigger. Many agreements do not require repayment after a layoff, and some state rules limit it. Others say “any termination,” which could include a layoff. Check the wording and your severance paperwork.
Is sign-on bonus repayment prorated?
Often it is, but not always. Some agreements demand the full amount if you leave before the end date. Some states require proration for covered terms. See Full vs. Prorated Repayment and the estimator for the math.
What happens if I do not repay a sign-on bonus?
The employer may follow up with demand letters, refer the debt to a collector, or sue to enforce the agreement, and it may try to recover money from your pay where the law allows. Outcomes vary. Do not ignore a demand; respond in writing and check the agreement and your state’s rules.
Can my employer sue me for sign-on bonus repayment?
An employer can bring a contract claim if it believes the clause applies. Whether it succeeds depends on the agreement, state law, and how you left. Some states void certain repayment terms, and some let a worker recover fees if they defend successfully.
Do I repay the gross or net amount?
Contracts typically demand the gross amount. Ask HR in writing which number they want and how they will handle payroll taxes. Tax rules may return part of the withheld tax, but they do not guarantee full recovery.
Can I get the taxes back if I repay a bonus?
Sometimes, partly. If you repay in the same year, the employer can generally adjust the wages it reports. If you repay in a later year and it is more than $3,000, IRC §1341 may allow a deduction or credit. See the tax section.
What is a claim of right, and what is IRC §1341?
The claim of right rule applies when you reported income in one year because you appeared to have an unrestricted right to it, and then had to repay it in a later year. Section 1341 gives relief for repayments over $3,000, either as a deduction or a credit, whichever results in lower tax.
What if I repay in a different tax year than I received it?
You generally cannot amend the earlier return to remove the income. Instead, you claim the deduction or credit in the year you repay, if the amount is over $3,000. At $3,000 or less, there is generally no federal deduction under current law.
Can I recover Social Security and Medicare tax on a repaid bonus?
Possibly, through separate procedures. Your employer may refund the payroll taxes and issue a corrected W-2, or in some cases you may file IRS Form 843. Additional Medicare Tax is handled differently. Check Publications 15 and 525.
Can my employer deduct a sign-on bonus from my final paycheck?
Only if state law allows it. Many states require your written authorization, and some, like California, tightly restrict deducting a debt from final wages. Read the final paycheck section and do not sign an authorization without reading it.
Can my employer deduct training costs from my final paycheck?
The same wage-deduction rules apply, plus the federal minimum wage rules under the Fair Labor Standards Act. Colorado also requires that training recovery not violate the FLSA. Check your state labor department’s guidance.
Can my employer make me pay for training if I quit?
Sometimes. It depends on the agreement, the kind of training, and your state. Colorado, New York, California, and Washington each limit these terms in different ways. See Training Costs and TRAPs.
Are training repayment agreements enforceable?
Some are and some are not. Enforceability turns on the date signed, the state, the cost, proration, and whether the training is transferable. Regulators have challenged some of them, as in the HCA settlement.
What is a TRAP agreement?
TRAP stands for training repayment agreement provision. It is a clause that requires you to repay training costs if you leave before a set period.
What does California’s AB 692 say about sign-on bonuses?
For covered agreements, it voids most repayment terms but allows a sign-on bonus clause that meets strict conditions: a separate agreement, notice and 5 business days to consult an attorney, proration over two years or less, no interest, an option to defer the bonus, and repayment triggered only by your choice to leave or termination for misconduct.
What is AB 1697, and did it become law?
AB 1697 is an urgency bill that would move AB 692’s start date to agreements entered on or after January 1, 2027, and add exceptions. As of September 29, 2026, the governor had not acted; his deadline is September 30, 2026. Check the California update box at the top for the outcome.
AB 1697 was signed on [INSERT DATE] and took effect immediately as an urgency bill. AB 692’s restrictions now apply only to agreements entered into on or after January 1, 2027, and the bill adds new exceptions.
AB 1697 was vetoed on [INSERT DATE]. AB 692 continues to apply to agreements entered into on or after January 1, 2026.
When does New York’s Trapped at Work Act take effect?
The current statute text points to December 19, 2026. Some law-firm alerts read the date as February 13, 2027, so verify on NYSenate.gov. Whether it reaches agreements signed earlier is unclear.
Does Colorado allow training repayment?
Yes, within limits. The training must be distinct from normal on-the-job training, the recovery must be limited to reasonable cost, and it must decrease proportionally over up to two years.
What did Washington change?
Washington signed ESHB 1155 on March 23, 2026, a near-total noncompete ban effective June 30, 2027, with a narrow allowance for repaying out-of-pocket educational expenses. It is written around restraints on competing, so check how it applies to your bonus.
Can a repayment debt go to collections?
Employers can refer debts to collectors. A referral does not prove the debt is valid. If it happens to you, see Debt Collector Rights, and consider requesting validation in writing.
Last updated . California status as of that date: AB 1697 awaiting the governor’s action (deadline September 30, 2026).California status as of [INSERT DATE]: AB 1697 signed.California status as of [INSERT DATE]: AB 1697 vetoed.
This article is for general education only. Laws on stay-or-pay agreements are changing throughout 2026, and details may have changed since the date above. It is not legal or tax advice. For a dispute, contact your state labor department or an employment attorney, and for tax questions consult a tax professional.
Daniel Hayes is the founder and sole researcher at AdvoraHQ. He covers U.S. personal finance, insurance, and consumer law — working directly from IRS publications, federal and state statutes, court opinions, and SEC filings rather than secondary summaries. His focus is the gap between what readers think they know and what the source documents actually say. Daniel is not a licensed attorney, CPA, or financial advisor; his articles are educational and not personalized advice. Reach him at Daniel.Hayes@advorahq.com.
