AI discrimination lawsuit against Workday moves to collective action

A lawsuit littered with allegations that Workday’s AI recruitment tools had discriminatory impacts on applicants will now move forward as a nationwide collective action.

As previously reported by HR Leader, job applicant Derek Mobley filed a lawsuit to the San Francisco Federal Court, alleging that the AI tools Workday relies on in its recruitment process directly discriminated against him.

Mobley – a 40-year-old Black man – claims that he had been turned down for more than 100 jobs he applied for through Workday’s platform, blaming the AI algorithms’ biases for this occurrence. Thousands of organisations use Workday’s AI-based applicant screening tools, which can automatically reject or advance applicants.

“Because there are no guardrails to regulate Workday’s conduct, the algorithmic decision-making tools it utilises to screen out applicants provide a ready mechanism for discrimination,” said Mobley’s lawyers in the lawsuit.

Workday denied wrongdoing and moved for the lawsuit to be dismissed, claiming that it engages in an ongoing “risk-based review process” to ensure that its products comply with applicable laws and aren’t engaging in any forms of discrimination.

The lawsuit continued, however, with a judge in the District Court for the Northern District of California recently expanding the age discrimination claim within the lawsuit to a national action, resulting in millions of other applicants over the age of 40 having the opportunity to join.

According to law firm Fisher Phillips, the case is based on “disparate impact theory,” which allows claims to continue without proof of direct “intentional discrimination.”

This theory, however, is currently under hostile attack by sitting US President Donald Trump, who recently signed an executive order to direct federal agencies – including the Equal Employment Opportunity Commission – to eliminate enforcement based on disparate theory.

This, of course, limits the number of government-led investigations into AI and algorithmic discrimination moving forward; however, private litigation matters such as the Workday case can continue.

Trump’s deregulation mission in the AI space was teased during his 2024 election campaign, where he announced his plans to repeal Joe Biden’s AI executive order, which – among other things – provided a set safety and privacy standards for AI, including ensuring that principles and practices are developed to mitigate the harms AI poses to workers.

“When I’m re-elected, I will cancel Biden’s artificial intelligence executive order and ban the use of AI to censor the speech of American citizens on day one,” Trump said.

“[Biden’s executive order] hinders AI innovation and imposes radical leftwing ideas on the development of this technology.”

Fisher Phillips said that with less government intervention in these employer-related cases, state agency claims, private class actions, and opt-in lawsuits targeting AI biases are set to increase.