Job Applicants Sue to Unlock 'Black Box' of AI Hiring Decisions, Targeting Eightfold AI
In a groundbreaking legal move, a group of job applicants has filed a lawsuit aiming to force artificial intelligence screening companies to disclose more about how they evaluate candidates. The suit specifically targets Eightfold AI, a company that markets its technology as a time-saving and cost-effective tool for employers. This case represents an early attempt to challenge the opaque nature of AI-driven hiring processes, which millions of applicants encounter as their first hurdle in job searches.
The Lawsuit's Core Argument: Applying Credit Reporting Laws to AI
The lawsuit, filed in Contra Costa County Superior Court in California, argues that AI employment screening tools should be subject to the same requirements as credit agencies under the Fair Credit Reporting Act. Plaintiffs claim that the process is similar to how credit agencies assign numeric scores based on financial data, and they seek to compel AI firms to reveal what data is gathered and how applicants are ranked. Erin Kistler, one of the plaintiffs with a computer science degree and decades of tech industry experience, expressed frustration over the lack of feedback, stating, "I think I deserve to know what's being collected about me and shared with employers. And they're not giving me any feedback, so I can't address the issues." Kistler reported that only 0.3% of her thousands of applications led to follow-ups or interviews, with several routed through Eightfold's system.
Eightfold AI's Role and the Broader Implications
Eightfold AI, based in Santa Clara, California, uses sources like LinkedIn to create a dataset encompassing over 1 million job titles, 1 million skills, and profiles of more than 1 billion people. Its software scores applicants on a scale of 1 to 5, but job seekers say it acts as an algorithmic gatekeeper, blocking candidates without explanation. A representative for Eightfold did not respond to requests for comment. Legal experts, such as David J. Walton, a Philadelphia lawyer specializing in AI issues, note that while companies might argue these tools differ from credit scoring, they operate in legally gray areas, particularly concerning data privacy and potential discrimination. "These tools are designed to be biased. I mean, they're designed to find a certain type of person," Walton said, highlighting the fine line between intended and improper bias.
Historical Context and Legal Precedents
The Fair Credit Reporting Act, enacted in 1970, was designed to protect consumers from errors in credit reports by requiring disclosure and dispute mechanisms. The lawsuit invokes this law to address what some call 'black box' employment decisions, where applicants are kept in the dark. David Seligman, executive director of Towards Justice, a nonprofit law firm involved in the case, emphasized, "There is no AI exemption to our laws." This case follows other legal challenges, such as a 2023 lawsuit against Workday, where a judge allowed claims of discrimination against older, disabled, and Black applicants to proceed. A Workday spokesperson denied the allegations, stating their AI tools do not use protected characteristics.
Regulatory Shifts and Future Outlook
Regulatory guidance has fluctuated, with the Consumer Financial Protection Bureau under the Obama administration opining that hiring dossiers fall under the Fair Credit Reporting Act, but this was rescinded under President Donald Trump. Jenny Yang, a former chair of the Equal Employment Opportunity Commission and a lawyer for the plaintiffs, noted that concerns about algorithmic hiring have been brewing for over a decade. "We realized they were fundamentally changing how people were hired. People were getting rejected in the middle of the night and nobody knew why," she said. The lawsuit seeks class-action status, financial damages, and compliance with consumer reporting laws, though corporate litigation is expected to take years.
