Jurisdiction: United States District Court for the Northern District of California
Ruling Date: July 15, 2024
District: Northern District of California
Summary: In Mobley v. Workday, Inc., the plaintiff, Derek Mobley, brought a proposed class action lawsuit against Workday, Inc., alleging that the company’s AI-powered recruitment and applicant screening tools contained discriminatory algorithms that adversely affected candidates based on protected categories including race, age, and disability. Mobley claimed that he was denied consideration for more than 100 positions with various companies that utilized Workday's software as part of their hiring processes. According to Mobley, the algorithms systematically filtered out applicants based on criteria correlated with race, age, and other legally protected characteristics, thus perpetuating implicit biases in hiring decisions.
The court ruled on a significant preliminary motion by Workday, which argued that it could not be held liable because it was not the direct employer. However, the court found that Workday’s role in screening applicants on behalf of its clients could place it within the scope of federal anti-discrimination statutes like Title VII of the Civil Rights Act, as it essentially performed employment functions for hiring companies. By allowing the case to proceed, the court opened the door for potential accountability of AI providers in employment discrimination claims, underscoring the possible legal responsibilities of companies providing AI-driven HR tools.
This case marks a significant moment in employment law, raising issues about how third-party AI technology providers might bear liability for discrimination claims that arise from their algorithms’ outcomes. Should Mobley’s claims be substantiated, it could establish a precedent for broader obligations on AI developers to ensure non-discriminatory outcomes, echoing a larger legal trend scrutinizing AI's role in perpetuating systemic biases.