SB 26-189

SB 26-189 is the Colorado Senate Bill signed by the governor in mid-May 2026 to replace the stayed Colorado AI Act (SB 24-205). It takes effect on 1 January 2027. The replacement law preserves only a notice obligation: employers must inform workers before using an AI system in a consequential employment decision, and must provide an adverse-action process. The risk-management programmes, annual algorithmic-impact assessments, and anti-discrimination duties of SB 24-205 were removed entirely.

The bill was drafted and passed rapidly after a federal magistrate stayed SB 24-205 on 27 April 2026, in response to a joint constitutional challenge from xAI and the US Department of Justice. Rather than defend the original statute, the Colorado legislature chose to replace it with a framework the federal challengers could not credibly attack: a notice duty imposes no algorithmic obligations and carries no discrimination liability. The legislative calculus was survival over substance.

SB 26-189 is now the realistic ceiling for US state AI employment law, at least until a federal statute or appellate decision changes the constitutional landscape. It signals to other state legislatures that notice-only is the form that survives a federal-executive challenge; anything stronger faces the same dismantling Colorado endured.