Workday's discriminatory hiring tech prevented people over 40 from getting hired, lawsuit alleges

CNN

22-05-2025

Tech firm Workday is facing a collective action lawsuit alleging that its job applicant screening technology is discriminatory, following an order by a California district judge on Friday. The outcome could set a precedent for whether and how companies can use algorithms and artificial intelligence to make hiring decisions, as companies increasingly adopt the technology.
Last year, a man named Derek Mobley sued the human resources software company claiming that Workday's algorithms caused him to be rejected from more than 100 jobs on the platform over seven years because of his age, race and disabilities. Four other plaintiffs have since joined with age discrimination allegations.
Together, the plaintiffs, all over the age of 40, claim that they submitted hundreds of job applications through Workday and were rejected each time — sometimes within minutes or hours. They blame Workday's algorithm, which they claim 'disproportionately disqualifies individuals over the age of forty (40) from securing gainful employment' when it screens and ranks applicants, court documents state.
Judge Rita Lin's Friday preliminary order will allow the case to proceed as a collective action suit — similar to a class action.
AI tools can help HR professionals manage the influx of hundreds of applications they receive — some of which may have been created using AI. But experts worry about the technology deciding which candidates are 'most qualified' because AI can contain biases that may prevent people from getting hired based on their age, gender, race or other characteristics.
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The American Civil Liberties Union, for example, has warned that AI hiring tools 'pose an enormous danger of exacerbating existing discrimination in the workplace.' In one prominent case in 2018, Amazon did away with an automated job candidate ranking tool after it found the system favored male applicants over women.
Still, Workday has denied the claims that its technology is discriminatory. In a statement, a Workday spokesperson noted that the Friday order is a 'preliminary, procedural ruling … that relies on allegations, not evidence.'
'We continue to believe this case is without merit,' the spokesperson said. 'We're confident that once Workday is permitted to defend itself with the facts, the plaintiff's claims will be dismissed.'
Used by over 11,000 organizations worldwide, Workday provides a platform for companies to post open jobs, recruit candidates and manage the hiring process; millions of open jobs are listed with its technology each month. It also offers a service called 'HiredScore AI,' which it says uses 'responsible AI' to grade top candidates and cut down the time recruiters spend screening applications.
In a court filing opposing the lawsuit's allegations, Workday claims that it does not screen prospective employees for customers and that its technology does not make hiring decisions.
But Mobley claims that he was rejected time and again — often without being offered an interview — despite having graduated cum laude from Morehouse College and his nearly decade of experience in financial, IT and customer service jobs. In one instance, he submitted a job application at 12:55 a.m. and received a rejection notice less than an hour later at 1:50 a.m., according to court documents.
Another plaintiff, Jill Hughes, said she similarly received automated rejections for hundreds of roles 'often received within a few hours of applying or at odd times outside of business hours … indicating a human did not review the applications,' court documents state. In some cases, she claims those rejection emails erroneously stated that she did not meet the minimum requirements for the role.
'Algorithmic decision-making and data analytics are not, and should not be assumed to be, race neutral, disability neutral, or age neutral,' Mobley's original complaint states. 'Too often, they reinforce and even exacerbate historical and existing discrimination.'
Experts say AI hiring tools can demonstrate bias even if companies never instruct them to favor certain categories of people over others. These systems are often trained on the resumes or profiles of existing employees — but if a company's existing workforce is largely male or white, the technology could inadvertently infer that the most successful candidates should share those characteristics.
Hilke Schellmann, author of the book 'The Algorithm' about the use of AI in hiring, who is not involved in the Workday lawsuit, recounted a situation in which a different resume evaluation tool awarded more points to resumes with the word 'baseball' over ones that listed 'softball.'
'It was some random job that had nothing to do with sports and probably what happens is that of the resumes the parser analyzed, maybe there were a bunch of people who had 'baseball' on their resume and the tool did a statistical analysis and found out, yeah, it's totally significant,' Schellmann said on CNN's Terms of Service podcast earlier this year.
The AI 'wouldn't understand, 'wait a second, baseball has nothing to do with the job,'' she said.
Mobley's complaint alleges that Workday's technology works in a similar way.
'If Workday's algorithmic decision-making tools observe that a client-employer disfavors certain candidates who are members of a protected class, it will decrease the rate at which it recommends those candidates,' the complaint states.
Lin's Friday order will allow Mobley's lawyers to notify other people who may have similar discrimination claims against Workday and allow them to join the suit. However, Workday can still ask the court to handle the claims individually, rather than as a group.
The lawsuit is seeking unspecified monetary damages, as well as a court order requiring the company to change its practices.