Can AI hiring tools discriminate against job applicants?

AI hiring tools may create discrimination concerns if their screening, ranking, or recommendation systems disproportionately disadvantage applicants based on protected characteristics such as age, race, or disability. Employers and technology providers may face legal challenges when automated hiring practices allegedly produce discriminatory results.

What is the Mobley v. Workday case about?

Mobley v. Workday Inc. is a proposed class action alleging that Workday’s algorithmic applicant-screening tools discriminated against job applicants based on age, race, and disability. The lawsuit asserts claims under federal employment discrimination laws.

What laws apply to discrimination involving AI hiring tools?

Federal employment discrimination laws potentially applicable to AI-assisted hiring include Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act (ADEA), and the Americans with Disabilities Act (ADA).

What is disparate-impact discrimination in AI hiring?

Disparate-impact discrimination can occur when a facially neutral employment practice disproportionately disadvantages members of a legally protected group. Unlike intentional discrimination claims, a disparate-impact claim generally does not require proof that an employer intended to discriminate.

Can an AI company be held responsible for employment discrimination?

The Mobley litigation raises the question of whether a technology provider can potentially be held responsible when its hiring tools allegedly produce discriminatory results. The plaintiffs are pursuing claims against Workday itself rather than only against employers using its technology.

Can employers be liable for discrimination caused by AI hiring software?

Employers should not assume that using third-party AI software eliminates potential employment discrimination risks. Existing anti-discrimination laws can apply to employment practices involving technology, making it important for employers to understand how automated hiring tools affect applicants.

How can AI hiring algorithms create or reinforce bias?

AI hiring systems may create or reinforce bias when the data, criteria, or patterns used by an algorithm reflect existing disparities or discriminatory preferences. This can potentially cause applicants from protected groups to be ranked, recommended, or screened out at different rates.

What should employers consider before using AI hiring tools?

Employers should carefully evaluate AI hiring tools for potential discriminatory effects and understand how vendors screen, rank, and recommend applicants. Employers should also monitor developing laws and court decisions concerning artificial intelligence and employment discrimination.

What is algorithmic bias in hiring?

Algorithmic bias generally refers to patterns in an automated system that may produce different outcomes for certain groups of applicants. Bias can arise from training data, model design, selection criteria, or the way a tool is used.

Can neutral hiring criteria still produce unequal results?

Yes. A criterion may appear neutral on its face while producing different outcomes among groups of applicants. Whether those differences create legal concerns depends on the circumstances, applicable law, and the justification for the employment practice.

What role should human review play in AI-assisted hiring?

Human review can provide an additional layer of oversight when automated tools are used to screen or rank applicants. Employers may consider how much decision-making authority is given to a system and when human review is appropriate.

What information can AI hiring systems evaluate?

Depending on the tool, systems may evaluate information such as resumes, application responses, assessments, skills, or other job-related data. The information used and how it is analyzed can vary significantly among products.

Are AI hiring tools regulated the same way everywhere in the United States?

No. Federal employment laws may apply alongside state and local requirements, and some jurisdictions have adopted rules specifically addressing automated employment tools. Requirements can vary and continue to evolve.

What is an algorithmic impact assessment?

An algorithmic impact assessment is a process used to evaluate how an automated system operates and identify potential risks or unintended effects. The scope and requirements of an assessment can vary depending on the jurisdiction and context.

Can job applicants find out whether AI was used to evaluate them?

Disclosure requirements vary. Some jurisdictions or employer policies may require or provide notice when automated tools are used, while other situations may be governed by different rules.

How can employers evaluate an AI hiring tool for potential bias?

Employers may consider testing outcomes, reviewing validation information, examining the data and criteria used by the system, and periodically reassessing its performance. Appropriate measures depend on the tool and applicable requirements.

Why is transparency from AI hiring vendors important?

Information about how a tool works, what data it uses, its limitations, and how it has been tested can help employers assess potential risks before incorporating it into employment decisions.

Why should employers document how AI hiring tools are used?

Documentation can help organizations understand how automated tools are incorporated into hiring decisions and support internal review or compliance efforts. Specific recordkeeping obligations depend on the employer and applicable law.

AI Hiring Tools Under Scrutiny

Q: How does Workday use AI in the hiring process?

According to the allegations in the lawsuit, Workday offers tools that use artificial intelligence, machine learning, and other algorithms to help screen, evaluate, rank, recommend, or screen out job applicants.

30 Sep 2026

Last Updated: September 30, 2026

As artificial intelligence becomes more common in workplace hiring, concerns are growing that these tools may introduce or reinforce bias. Those concerns are central to Mobley v. ⁠Workday Inc., a proposed class action filed in 2023 alleging that Workday’s algorithmic applicant-screening tools discriminated on the basis of age, race, and disability in violation of the Age Discrimination in Employment Act (ADEA), Title VII of the Civil Rights Act of 1964, and the Americans with Disabilities Act (ADA).

Workday is a workforce management platform that helps companies streamline hiring and recruitment. Some of Workday’s tools use artificial intelligence to screen applicants. The complaint alleges that Workday’s products use artificial intelligence, machine learning, and other algorithmic tools to screen, evaluate, rank, and recommend or screen out job applicants. Specifically, plaintiffs allege that Workday’s screening and recommendation systems can reproduce or amplify discriminatory preferences reflected in employer or workforce data, resulting in applicants in protected groups being recommended or screened out at different rates.

The plaintiffs proceed under disparate-impact theories, which generally challenge facially neutral employment practices that disproportionately disadvantage members of protected groups without requiring proof of intentional discrimination. In June 2026, the U.S. District Court for the Northern District of California granted in part and denied in part Workday’s motion to dismiss, allowing most of the discrimination claims to proceed.

The case underscores the growing legal risks associated with employers’ use of AI tools in hiring. Although plaintiffs seek to hold Workday itself responsible for the alleged discrimination, rather than the employers that use its technology, employers should use caution when adopting these tools. The case may preview how courts will address future lawsuits brought directly against employers that use AI tools alleged to introduce or reinforce bias.

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About Christina Cacioppo

Christina Cacioppo is an Associate in Faruqi & Faruqi’s New York City office. Christina’s practice is focused on Employment Law.

Christina Cacioppo

Associate at Faruqi & Faruqi, LLP

New York office

Tel: (212) 983-9330

Fax: (212) 983-9331

E-mail:ccacioppo@faruqilaw.com

Tags: AI Bias, AI Hiring Tools, Algorithmic Bias, artificial intelligence, employee rights, Employment Discrimination, employment law, Hiring Discrimination, Workday, Workplace AI

AI Hiring Tools Under Scrutiny

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