Dive Brief:
- A federal court in California on Monday refused to dismiss allegations that Workday’s artificial intelligence screening tools violated state nondiscrimination law, even though not all plaintiffs in the case are California residents, court documents show (Mobley, et al. v. Workday).
- Because Workday is headquartered in California and its artificial intelligence tools were designed and are maintained there, the plaintiffs in the case alleged “sufficient nexus to California” to apply the state’s Fair Employment and Housing Act to their case, Judge Rita Lin determined. Lin also refused to toss a disability bias claim that Workday sought to have stripped.
- The lawsuit alleging Workday’s AI software automatically screened out applicants has been among the most watched in early lawsuits applying a theory of AI-based discrimination.
Dive Insight:
The lawsuit was first filed as a proposed class action in February 2023, alleging Workday’s applicant screening technology discriminated on the basis of age, race and disability, violating the Age Discrimination in Employment Act, Title VII of the Civil Rights Act and the Americans with Disabilities Act. Later amended complaints added the FEHA claims.
The plaintiff — eventually joined by several co-plaintiffs — said that since 2017, he’d applied for over 100 positions at companies that use Workday tools for recruiting. He’d been rejected for every position, and because the rejections were often immediate or in the middle of the night, he inferred they were automated.
The collective action was approved in May 2025, despite Workday’s concern at the time the class could potentially be massive in scope.
“If the collective is in the ‘hundreds of millions’ of people, as Workday speculates, that is because Workday has been plausibly accused of discriminating against a broad swath of applicants,” Lin ruled at the time. “Allegedly widespread discrimination is not a basis for denying notice.”
In her decision on Monday, Lin was unmoved by Workday’s argument that the FEHA should not apply because many of the class members are not residents of California. FEHA can apply if a participating actor residing in California — Workday, in this case — allegedly violated the law in its dealings with a nonresident, assuming “sufficient factual allegations in the complaint to show a nexus between California and the allegedly unlawful conduct.”
Per the judge, Workday did not challenge the assertion that its AI tools were “designed, developed, maintained, and controlled” from its California headquarters, that it “train[ed] and operate[d]” the tools in California and that the screening and rejection originated in California.
After previously throwing the claim out, Lin allowed one plaintiff — and others similarly situated — to proceed on an ADA claim that Workday discriminated against her on the basis of asthma and cancer survivorship. The third amended complaint in Mobley strengthened her claim, Lin said, connecting her rejections to screening based on medical-related leave and treatment and recovery patterns.
While Judge Lin allowed the FEHA and several other claims to proceed, she granted Workday’s motion to throw out a race-based disparate impact claim and a claim that Workday is liable as an employer because it uses the challenged procedures in its own hiring.
Workday told HR Dive it looks forward to addressing the allegations in court.
“The claims in the suit are false. Workday’s AI recruiting tools don’t make hiring decisions in California or anywhere else. Our customers maintain full control of their hiring processes and our tools are designed with human oversight at their core,” a company spokesperson said. “Our technology looks only at job qualifications, not protected traits like race, age, or disability. We rigorously test our products as part of our Responsible AI program to confirm our tools do not harm protected groups.”
