AI-Related Layoffs Test New York’s Ability to Track Job Losses

More than 160 companies filed mass termination notices with New York’s Department of Labor in the year following a first-of-its-kind update to the Worker Adjustment and Retraining Notification (WARN) law requiring disclosure of AI impact on the cuts.

But none of the notices—including from Amazon.com Inc. and Goldman Sachs Group Inc. which have integrated AI technology in their business operations—attributed layoffs to “technological innovation or automation,” an agency spokesperson confirmed.

The filings revealed what labor and public policy experts say are the shortcomings of using self-reporting measures like WARN laws to trace AI’s true labor impact, and a lack of clarity and transparency about its growing workplace role.

Employers are generally hesitant to admit to AI-driven job cuts because of legal or business concerns, and their decision to cite restructuring, economic, or operational factors tests the effectiveness of New York’s broadening efforts to create more transparency, they said.

New York’s approach is “well intentioned,” but “fundamentally, the WARN Act is a product of the 1970s,” when factory closings were geographically confined and occurred over days or weeks, said Kevin Frazier, a senior fellow at the Abundance Institute. That contrasts with today’s gradual, complex exposure to evolving technologies like AI, he said.

There may be “many compounding factors that make accurate assessments of AI adoption hard to pin down,” said Frazier, also a Cato Institute adjunct research fellow.

Even if AI causes layoffs, WARN laws can miss certain nuances because they primarily require advance notice of job cuts and don’t regulate tech changes or complex business decisions, policy experts said.

“There are a lot of factors in our economy right now that are driving a lot of disruption for workers,” said Amanda Ballantyne, a senior fellow for Workers and Tech at New America and former director of the AFL-CIO Technology Institute. “There are big shifts with the federal administration’s economic policy, employers are starting to experiment with AI, though I don’t think we’ve actually seen an enormous amount of AI layoffs yet.”

Defining ‘AI-Related Layoff’

The federal WARN Act requires companies with over 100 workers to give 60 days’ notice of firings, but no reason is needed as part of the filing. WARN laws in 15 states, however, have stricter requirements, like a longer notice period.

AI-related layoffs can be “difficult” to define without knowing whether the actual cause was software modernization, robotics, or AI technology itself, Frazier said.

New York DOL Commissioner Roberta Reardon previously acknowledged in a Bloomberg Law interview that defining an AI-related layoff is challenging.

Policy experts recommend that states focus on new jobs and skills needed as companies adopt automation, since WARN laws mainly aim to ease economic transitions.

But additional bills in the New York legislature would broaden the state’s AI job-loss reporting beyond the WARN law, and also require its DOL to conduct annual studies on automation’s effects on specific occupations, industries, demographics, and regions.

Companies with over 100 workers would report estimates of displaced workers, unfilled roles previously held by humans, and hours changed due to AI under one proposal.

Another bill would require companies with at least 50 employees to provide a 90-day written notice before implementing AI or automation that causes significant cuts or reduced hours. Violators risk $10,000 fines and lose access to state grants, loans, or tax incentives for five years under the measure.

Automation Adopters

AI or automation led to over 48,400 job cuts in 2025, the second-most cited factor for layoffs after cost-cutting, according to Challenger, Gray & Christmas, which tracks labor market data.

Goldman Sachs was among the companies that announced layoffs or reduced hiring last year, citing the technology’s cost savings.

A spokesperson told Bloomberg Law that its last New York WARN notices were “triggered” by the company’s annual talent review exercise, and any future activity meeting new WARN Act rules will be reported. Goldman’s headcount also grew by year’s end, they added.

Months before Amazon announced 14,000 job cuts in October, CEO Andy Jassy said the company’s workforce would shrink in the coming years as AI takes on more tasks, Bloomberg News reported. Jassy later clarified that those cuts weren’t “really AI-driven. Not right now, at least.”

A spokesperson for the e-commerce giant said AI isn’t behind most workforce reductions, and the recent cuts were intended “to strengthen culture and teams by reducing layers, increasing ownership, and cutting bureaucracy to boost speed and accountability.”

Companies submitting New York WARN filings must substantiate their submissions, and the labor agency may follow up if needed.

“It is critical that employers answer the questions in WARN frankly and honestly so New York State can support displaced workers to the greatest extent possible,” an agency spokesperson said.

The law has a civil penalty of $500 per day per violation.

‘AI-Washing’

Currently, the extent of worker replacement by AI or automation is mainly anecdotal and speculative.

Some reports suggest finance-driven layoffs may be mistaken for AI-driven ones. Attorneys and economists also question whether companies are reducing staff due to efficiency gains or to conceal the real reasons, a practice known as “AI-washing.”

“Companies are using narratives about AI to frame layoffs in ways that are most likely to be well received by shareholders and potential shareholders,” said Andi Mazingo, founder and principal attorney of Lumen Law Center.

In all states except Montana, the at-will employment doctrine enables private employers to fire workers for any reason, barring exceptions like public policy violations and discrimination based on protected traits. A laid-off worker must prove AI was a pretext for discrimination.

“I don’t think litigation and existing legal structures are the solution” to address AI-workforce impact, Mazingo said. “It needs collaboration with the corporations themselves” to understand the nuances.