Executive Summary

On May 16, 2025, U.S. District Judge Rita Lin of the Northern District of California granted preliminary certification of the case of Mobley v. Workday as a collective action. Specifically, the suit claims that Workday’s artificial intelligence (AI)-based applicant recommendation system unfairly discriminates against job seekers above the age of 40. The plaintiff claims that he was denied across multiple companies using the same system. The judge’s preliminary certification of the case as a collective action enables qualified individuals across the U.S. to opt in to the lawsuit.

Constellation believes the case has no merit, given that the AI system did not make the final decision on its own and that the same system used by different employers breaks the notion of a unified policy. Talent-acquisition professionals work very differently at each organization. The implementation, configuration, policies, and practices can differ greatly at each employer. Ultimately, the employers in question should bear responsibility in hiring decisions when AI is programmed to uniquely meet the employers’ requirements. However, the issue of AI ethics should remain top of mind for employers and technology vendors, who must comply with regulatory requirements and applicable laws.

At Issue: Alleged Discrimination by AI, Not  the Employer

Disparate impact theory is a legal framework holding that a seemingly neutral policy or  practice can be unlawful if it has a disproportionately negative effect on a protected  group, even if the policy was not created with discriminatory intent. The theory was  codified in Title VII of the Civil Rights Act of 1991 after the Griggs v. Duke Power Co.  (1971) case. In the Mobley v. Workday case, the plaintiff, Mobley, argues that his protected class is those over the age of 40. To prove a case, the employee must show the policy’s negative impact, after which the employer must demonstrate the policy is job-related and consistent with business necessity or show that no less-discriminatory alternative was available. 

Employers typically have to defend these cases by showing that this policy is necessary for business operations and that there are no less-discriminatory options. However, in a strange twist, the plaintiff in this case has decided to sue Workday, the technology vendor used to help the employer with its recruiting. This Age Discrimination in Employment Act (ADEA) case could be one of the largest collective actions ever certified. 

CHROs and Employers Ultimately Make Hiring  Decisions, Not Technology Vendors or AI

Falsely preying on society’s dystopian fears of AI systems going amuck may rightfully raise  attention paid to AI ethics and governance policies. However, the merits of this case remain flawed. Constellation believes the following:

1. A candidate who is not qualified regardless of age still should not be hired. Just  because candidates over 40 are rejected does not mutually exclude them from  being unqualified.

2. The judge’s reasoning to treat screening systems as a “unified policy” even if used  by different companies for a variety of positions at a national level invites a flurry of frivolous lawsuits and discrimination claims.

3. Passing off an employer’s individual responsibility to create fair policies across a  wide variety of job classes and placing the blame on AI vendors is grossly negligent. 

Until AI systems actually hire people without human involvement or control, blaming the  technology vendor is absolutely wrong. So long as the AI vendor has configured and implemented the employer’s policies, guidelines, and protocols, the vendor should not be liable for potential bias and discrimination. Moreover, screening systems should not be treated as a “unified policy,” especially when these systems are all individually uniquely configured and are leveraged by individual recruiting professionals in a myriad of different ways. The fact that users of an AI system all will configure their systems for their own unique needs across a variety of job positions should dismantle conditional certification to begin with.

Workday must challenge the lawsuit’s merits and its preliminary certification, or other technology vendors may be falsely accused of creating disparate impact when the employer is the one ultimately in charge. Other technology vendors should rise up and provide an amicus brief in support of Workday.

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Your POV

Will you blame AI for your decisions or will you own up? Do you think Mobley has a case or is Workday in the right?

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