Connecticut Gov. Ned Lamont (D) signed a sweeping, bipartisan AI legislation that imposes new disclosure obligations on employers that deploy automated tools in hiring, promotion, and termination decisions.
Why it matters: SB 5, effective October 1, 2026 (with further obligations effective in 2027) makes Connecticut one of a handful of states comprehensively regulating AI in employment. This law comes after ones passed in Illinois, Colorado, California, New York and Texas in an increasingly inconsistent state-level patchwork.
What CHROs need to know:
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AI in employment decisions must be disclosed: Employers must disclose to employees and job applicants when "automated employment-related decision technology" (AERDT) is a "substantial factor" in employment decisions (hiring, firing, promotions, discipline, etc.). AERDTs include conventional AI use cases but not word processors or spreadsheets.
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AI in layoffs must be disclosed: Employers must disclose, in WARN Act notices for plant closings or mass layoffs, whether the reductions are related to the employer's use of artificial intelligence or another technological change, effective Oct. 1, 2026.
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AI cannot be used as a discrimination defense: Employers may not cite the use of AERDTs as a defense against claims of discrimination.
Enforcement: Violations are treated as unfair or deceptive trade practices and enforced by the Attorney General, with a 60-day cure period through the end of 2027 and no private right of action.
What CHROs should consider:
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Inventory every step of the employment life cycle that AI touches—sourcing, screening, performance, comp, separations and vendor tools HR may have overlooked.
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Revisit vendor contracts for indemnification, audit rights and disclosure obligations tied to AERDTs.
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Build the WARN-notice AI disclosure into existing RIF playbooks now; the Oct. 1 deadline arrives before most workforce planning cycles close.
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For multi-state employers, expect to design to the strictest applicable standard rather than focusing on Connecticut alone. As of now, Colorado, California, and Illinois requirements are diverging, not converging.
Stay tuned as we continue to track this state-by-state AI legislation.
