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Judge overseeing Workday AI lawsuit has questions

Judge Rita Lin seeks clarity on Workday's liability in an AI lawsuit alleging hiring discrimination. The case could set a precedent for AI vendors' responsibility.

A pivotal legal battle is unfolding in a federal district court as U.S. District Court Judge Rita Lin seeks clarity on Workday's role in alleged hiring discrimination through its AI-enabled recruitment software.

The lawsuit, filed last year by Derek Mobley and in which he identifies himself as African American and over the age of 40 with anxiety and depression, accuses the HR tech vendor of embedding biases into its algorithms, which allegedly led to Mobley's repeated rejection from job opportunities.

The hearing is scheduled for May 14 in a San Francisco courtroom, where Lin will consider a motion to dismiss the AI lawsuit case. Lin's questions go to the heart of whether federal anti-discrimination law applies to algorithms. Workday argues, in part, that the employer controls the hiring process, not the software vendor.

This case has also captured the attention of the Equal Employment Opportunity Commission, which recently filed a brief urging the court not to dismiss Mobley's claims. It argues that Mobley has plausibly alleged Workday's role in hiring because its assessments and tests "give the platform significant control over whether an applicant advances in the hiring process."

Judge's scenario

Lin based her first hypothetical question on Title VII of the Civil Rights Act of 1964, which prohibits discrimination in employment. In an order published Thursday, she wrote the following:

Imagine a scenario in which a software vendor intentionally provides employers a tool that the vendor knows automatically screens out all applicants who previously attended historically black colleges when recommending candidates to be considered for interviews. The employers have no idea that the software contains this functionality. According to Workday's interpretation of Title VII, would any entity be liable for this act of intentional discrimination?

At the dismissal hearing, Lin expects both parties to be ready with answers to her questions.

If Mobley wins his case, the outcome of this AI lawsuit could still be limited, according to labor and employment attorney Michael Elkins, partner and founder at MLE Law in Fort Lauderdale, Fla.

You are going to have rulings that do ultimately hold AI vendors responsible in certain situations.
Michael ElkinsPartner and founder, MLE Law

Elkins said if Mobley wins in district court, it will not create a binding precedent. Instead, appellate court rulings would carry more weight in establishing liability standards for vendors, given that they establish laws that have to be followed by lower district courts.

"You are going to have rulings that do ultimately hold AI vendors responsible in certain situations," he said. But the courts will decide the issue on a case-by-case analysis, not a general rule that holds HR vendors automatically responsible.

Elkins said the Mobley case won't be the final word, and other courts with different viewpoints will weigh in on how the law applies. But, he added, appellate court rulings will ultimately shape the law.

Patrick Thibodeau is an editor at large for TechTarget Editorial who covers HCM and ERP technologies. He's worked for more than two decades as an enterprise IT reporter.

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