According to this rule, PIElaryngeals disappear between an underlying non-syllabic consonant (i.e. an obstruent or sonorant) and *y. Examples can be seen in the formation of imperfective verbs by appending [[wikt:Reconstruction:Proto-Indo-European/-yeti|*-yeti]] to the stem.
Compare:
PIE root [[wikt:Reconstruction:Proto-Indo-European/werh₁-|*werh₁-]] 'to say' → imperfective [[wikt:Reconstruction:Proto-Indo-European/wéryeti|*wéryeti]] 'to be saying' (cf. Ancient Greek εἴρω, eirō, 'to tell')
PIE root [[wikt:Reconstruction:Proto-Indo-European/h₂erh₃-|*h₂erh₃-]] 'to plow' → imperfective [[wikt:Reconstruction:Proto-Indo-European/h₂éryeti|*h₂éryeti]] 'to be plowing' (cf. Old Irish airid 'to be plowing')
PIE root [[wikt:Reconstruction:Proto-Indo-European/(s)néh₁-|*snéh₁-]] 'to spin' → imperfective [[wikt:Reconstruction:Proto-Indo-European/(s)néh₁yeti|*snéh₁yeti]] 'to be spinning' (cf. Old Irish sníid, 'to spin'). Here the laryngeal */h₁/ is not deleted since it is preceded by a vowel.
References
Pinault, G-J. (1982). A neglected phonetic law: The reduction of the Indo-European laryngeals in internal syllables before yod (Papers from the 5th International Conference on Historical Linguistics ed.). Amsterdam: John Benjamins. pp. 265–272. {{cite book}}: Unknown parameter |agency= ignored (help)