AI is changing how employers evaluate employee performance, address misconduct, and plan workforce reductions. For HR leaders, these tools offer potential efficiencies but also raise new compliance questions and obligations. For example, when technology influences – or makes – an employment decision, who is responsible for verifying the result, and what must an employer disclose when automation contributes to eliminating jobs?
California has taken two significant steps to address these questions. On September 30, 2026, Senate Bill (SB) 947, the No Robo Bosses Act, and SB 951, which expands California Worker Adjustment and Retraining Notification (Cal/WARN) requirements for certain technology-driven workforce reductions, were signed into law.
These new laws address different aspects of workforce management. SB 947 establishes requirements for automated decision systems (ADS) used in employee discipline and termination, while SB 951 adds disclosure requirements to qualifying Cal/WARN notices when AI or other automated technology substantially contributes to a workforce reduction.
HR leaders should identify where AI is used to make or influence employment decisions, make sure people (not just technology) review important decisions, and consider the impact of automation when planning staffing changes.
What HR Needs to Know About Automated Discipline and Termination
SB 947 becomes operative July 1, 2027. It does not prohibit employers from using AI in employment management. Instead, it restricts certain uses of ADS and establishes specific requirements for disciplinary and termination decisions.
The law prohibits employers from using an ADS to violate employment, labor, safety, or civil rights laws; infer an employee’s protected status; or predict and take an adverse action against an employee for exercising their legal rights. Employers also may not rely solely on an ADS when making disciplinary or termination decisions.
When an employer primarily relies on an ADS output for a disciplinary or termination decision, a human being must audit the decision using the data that produced the output or other relevant supporting information. This may include supervisory evaluations, personnel records, work product, peer reviews, or witness interviews. If the output cannot be corroborated, or the reviewer determines that it is inaccurate, incomplete, or misleading, the employer may not use that output to make the decision.
The practical implication for HR is significant. A manager who simply approves an algorithm-generated termination recommendation is not necessarily satisfying the law. Meaningful review requires examining the supporting evidence, evaluating relevant context, and verifying the system’s conclusions.
SB 947 also establishes employee-notice and data-access requirements. When an employer primarily relies on an ADS to make a disciplinary or termination decision, the affected employee must receive a separate, plain-language written notice when the decision is communicated. The notice must explain the system’s role, confirm a human reviewed and corroborated the output, identify a human point of contact, explain the employee’s right to request a meaningful, objective description of the employee’s own data used by the system, and address anti-retaliation protections.
HR teams should begin by identifying tools that influence employee performance ratings, productivity assessments, attendance decisions, disciplinary recommendations, and termination decisions. This list should include automated features embedded in existing HR platforms, not just products marketed specifically as AI. Employers should then establish a consistent review process that identifies who evaluates automated recommendations, what evidence must be considered, and how independent verification will be documented.
Manager training and employee communications are equally important. Managers should understand that an automated score or recommendation does not replace their responsibility to evaluate the underlying facts. HR should also develop notice templates and procedures for responding to employee data requests. Technology vendors should be able to explain what information their systems use and what records can be retrieved to support meaningful review.
When Automation Drives a Workforce Reduction
SB 951 addresses transparency when technology substantially contributes to the elimination of jobs. Effective January 1, 2027, the law expands the information employers must include in Cal/WARN notices for qualifying mass layoffs, relocations, or terminations caused in whole or in substantial part by AI or other automated technology replacing or automating employment positions.
Existing Cal/WARN requirements generally call for 60 days’ advance written notice of qualifying workforce reductions. SB 951 adds disclosures identifying the number, classification or occupation, and work location of affected employees; describing the job functions that will be automated; and identifying the category or type of technology involved. The notice must prominently state, “This notice is for a technology displacement.”
The enhanced disclosure requirements do not apply every time an employer adopts AI or eliminates an individual position. They apply to qualifying events under the Cal/WARN framework. Employers must evaluate the applicable coverage thresholds and whether automation caused the workforce reduction as specified by the statute.
For HR leaders, the challenge is ensuring that workforce planning and legal compliance are coordinated early enough to meet notice obligations. If an organization plans to automate a department, consolidate functions, or eliminate positions because technology can perform the work, HR should be involved before the restructuring is finalized. Early involvement gives the organization time to assess Cal/WARN coverage, identify affected employees, gather information about the functions being automated, and prepare accurate notices.
Employers should also document the business rationale for proposed changes. Records should explain which functions will be automated, which positions may be affected, and the role technology played alongside other business considerations. HR, legal, operations, and finance should coordinate their assessments so that required notices and internal communications accurately describe the reasons for the workforce reduction.
A Practical Compliance Checklist for HR Leaders
With the new requirements approaching, HR leaders should begin preparing now and work with outside employment counsel to identify potential compliance gaps. Start by identifying the automated systems used to make or influence employment decisions and determining who within the organization is responsible for each system. Establish written procedures for human review, including how managers will verify automated recommendations, document their findings, and explain the reasons for disciplinary or termination decisions.
Employers should also work with counsel to prepare employee-notice templates, establish a process for responding to employee data requests, and train managers on the limits of automated recommendations. Review vendor contracts and capabilities to confirm that the organization can access the information needed to meet its obligations. Before announcing a workforce reduction, consult with counsel to assess whether Cal/WARN applies and whether additional disclosures are required because of automation.
Finally, designate an HR leader or cross-functional team to coordinate these efforts with outside counsel, IT, and operations. Assigning clear responsibilities, ensuring consistency, and tracking progress will help the organization address compliance gaps and prepare for the January 1 and July 1, 2027, effective dates.
Michael Manoukian is a partner in Lathrop GPM’s Labor and Employment practice. He advises employers on California employment law, workplace compliance, and employment litigation.