# SB 947: Employment: Automated Decision Systems (No Robo Bosses Act)

Source: https://www.bankingnewsai.com/ai-regulation/documents/ca-sb-947-2026
Last updated: Oct 5, 2026

SB 947, signed by Governor Newsom on September 30, 2026 (Chapter 859, Statutes of 2026) and operative July 1, 2027, adds Part 5.5.5 (Sections 1520–1526.7) to the Labor Code. It bars an employer from relying solely on an ADS to discipline or terminate an employee; where an employer primarily relies on an ADS output for such a decision, a human must corroborate it with supporting information (supervisory evaluations, personnel files, work product, peer reviews), and the employer must give the employee a written postuse notice and, on request, a description of the employee's own data the ADS used. It is the first US law of its kind. The Labor Commissioner or a public prosecutor enforces it, with a $500 civil penalty per violation; there is no general private right of action.

## At a glance

| Field | Value |
| --- | --- |
| Authority | [California CPPA](https://www.bankingnewsai.com/ai-regulation/california) |
| Type | Statute |
| Status | Final · applies from Jul 1, 2027 |
| Published | Sep 30, 2026 |
| Effective | Jul 1, 2027 |
| Applies to | Any California employer — including banks and credit unions — that uses an automated decision system (ADS) to make or assist disciplinary or termination decisions about employees |
| Official text | https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=202520260SB947 |

## Key points

- First US statute to directly restrict employers' use of automated decision systems for discipline and termination
- An employer may not rely solely on an ADS to make a disciplinary or termination decision, and may not use an ADS to infer protected status or retaliate against an employee for exercising legal rights
- Where an employer primarily relies on an ADS output for such a decision, a human must corroborate it using the underlying data or other supporting information (supervisory/managerial evaluations, personnel files, work product, peer reviews, witness interviews); if it cannot be corroborated, or the reviewer finds the output inaccurate or misleading, the ADS output cannot be used
- Affected employees may request, and the employer must provide, a meaningful description of the employee's own data used by the ADS, and a written postuse notice confirming human corroboration and the employee's rights
- Anti-retaliation protection for employees who exercise rights, file complaints, or cooperate with an investigation under the Act
- Enforced by the Labor Commissioner or a public prosecutor; civil penalty of $500 per violation; a business already subject to CPPA ADMT regulations must still comply with those regulations in addition to this Act
- Exempts automated decision systems required for national-airspace aircraft development or national-security/military/defense purposes, and parties under a qualifying collective bargaining agreement that expressly waives the Act's provisions
- Operative July 1, 2027 — six months after the governor's October 2025 veto of an earlier, broader version of this bill

## What changed for banks

California adds an employment-specific AI statute alongside its existing Civil Rights Council ADS regulations and CPPA ADMT rules, narrowing in on the single highest-stakes employment use case — AI-assisted discipline and termination — and requiring documented human corroboration rather than leaving it to risk-based ADMT notice-and-opt-out obligations alone. For bank HR functions using AI-assisted performance or conduct tools, this adds a standalone corroboration-and-notice duty that applies regardless of whether the CPPA's significant-decision ADMT rules are also triggered.

## Use cases it governs

- [AI governance (general)](https://www.bankingnewsai.com/ai-regulation/by-use-case#governance-general)
- [Data & privacy](https://www.bankingnewsai.com/ai-regulation/by-use-case#data-privacy)

## FAQ

### Does SB 947 ban AI from being used in termination decisions?

No. It bans relying solely on an automated decision system for a disciplinary or termination decision. Where the employer primarily relies on the ADS output, a human must corroborate it with other supporting information before the decision is finalized.

### When does SB 947 take effect?

July 1, 2027. It was signed September 30, 2026 as Chapter 859, Statutes of 2026, reversing the Governor's October 2025 veto of an earlier version of the bill.

### Can an employee sue under SB 947?

Not directly. The Act is enforced by the Labor Commissioner or a public prosecutor, with a $500 civil penalty per violation; employees do have a protected right to request a description of their own ADS-used data and are protected from retaliation for asserting rights under the Act.

## Related documents

- [AB 1609](https://www.bankingnewsai.com/ai-regulation/documents/ca-ab-1609-2026) — Customer Service Chatbots (Right to Human Customer Service Act) (Sep 28, 2026)
- [CPPA ADMT, risk-assessment and cybersecurity-audit regulations](https://www.bankingnewsai.com/ai-regulation/documents/ca-cppa-admt-risk-cyber-regulations-2025) — CCPA Updates, Cybersecurity Audits, Risk Assessments, Automated Decisionmaking Technology, and Insurance Companies — approved regulation text (11 CCR Division 6) (Sep 22, 2025)
- [Civil Rights Council ADS employment regulations](https://www.bankingnewsai.com/ai-regulation/documents/ca-crc-ads-employment-regulations-2025) — Modifications to Employment Regulations Regarding Automated-Decision Systems (Fair Employment and Housing Act regulations, 2 CCR) (Jun 27, 2025)
- [California AG legal advisory on AI (Jan 2025)](https://www.bankingnewsai.com/ai-regulation/documents/ca-ag-legal-advisory-ai-2025) — Legal Advisory: Application of Existing California Laws to Artificial Intelligence (Jan 13, 2025)
- [Cal. Civ. Code §1798.145 (CCPA exemptions, incl. GLBA data)](https://www.bankingnewsai.com/ai-regulation/documents/ca-civil-code-1798-145) — California Consumer Privacy Act — exemptions, including the data-level exemption for information subject to the Gramm-Leach-Bliley Act and the California Financial Information Privacy Act (Civil Code §1798.145) (Jun 28, 2018)
- [Bailey: Frontier AI and the Question of Governance (Sep 2026)](https://www.bankingnewsai.com/ai-regulation/documents/boe-bailey-frontier-ai-governance-2026) — Frontier AI and the Question of Governance — Governor Andrew Bailey (Sep 30, 2026)
- [Atkins remarks at Investor Advisory Committee (Sep 2026)](https://www.bankingnewsai.com/ai-regulation/documents/sec-atkins-iac-ai-disclosure-remarks-2026-09) — Remarks at the SEC Investor Advisory Committee Meeting on AI Technologies and the Public Markets Information Ecosystem (Sep 10, 2026)
- [FCA multi-firm review: Frontier AI and cyber resilience (Sep 2026)](https://www.bankingnewsai.com/ai-regulation/documents/fca-frontier-ai-cyber-resilience-2026) — Frontier AI and Cyber Resilience (Sep 2, 2026)

Last reviewed Oct 5, 2026. Cite the official text (https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=202520260SB947) for the rule and this page for the summary and dates.

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