Outsourcing Hiring Won't Outsource Risk: Implications For Employers Using AI In Hiring

Recently, a federal court in the Northern District of California issued an important ruling in the closely followed Mobley v. Workday putative class action lawsuit alleging that Workday, a cloud-based software vendor specializing in financial management and human capital management, violated federal discrimination laws. In the lawsuit, the plaintiffs claim Workday's AI hiring platform screens out applicants over age 40 in violation of the Age Discrimination in Employment Act ("ADEA").

In this case, the plaintiff, along with four other individuals over forty, allege that Workday's AI-based recommendation system systematically disadvantaged older job applicants by scoring, sorting, and screening out their applications. According to the plaintiffs, Workday's tools embed biases from training data and employer preferences, thereby reducing opportunities for applicants in protected classes to advance past the initial screening stage. The plaintiffs allege they