TL;DR: Job seekers are suing an AI recruiting tool called Eightfold, accusing it of creating confidential reports to help employers screen candidates. Why is this illegal? The lawsuit alleges it’s the same reason credit rating companies have to explain why they hurt your score. If courts accept this logic, the black-box world of AI adoption could begin to be reshaped.
what happened: Like many people in the job search numbers game these days, the plaintiffs were tired of applications falling into thin air. They filed a class action lawsuit against Eightfold, which is used by major companies such as Microsoft and PayPal to vet job candidates. The complaint alleges that Eightfold violated the Fair Credit Reporting Act and similar California consumer protection laws by denying applicants access to information about the company and, if necessary, correcting their records.
“Eightfold’s technology lurks behind job applications and collects personal data such as social media profiles, location data, internet and device activity, cookies, and other tracking,” the complaint alleges.
Eightfold disputes this, with spokesperson Kurt Foeller saying the tool “works on data intentionally shared by candidates or provided by our customers. We do not scrape social media or anything else.” “Eightfold believes this allegation is without merit.”
What is undisputed is that Eightfold uses AI to generate a score from 0 to 5 that ranks candidates on how suitable they are for a particular job.
Why it’s important: Companies are now using a plethora of AI tools behind the scenes to find and evaluate candidates. Candidates are also in the game, using proprietary AI tools to find jobs and write applications. It’s AI all the way.
“We are at a stage where AI recruiting tools are being deployed very rapidly, often faster than companies can build the necessary compliance, audit, and governance structures to use AI recruiting tools responsibly,” the attorneys who worked on the case, Jenny R. Yang and Christopher M. McNerney, partners at Outten & Golden LLP, told us in an email. “That creates a real risk of not only inaccurate decisions but also hidden discrimination.”
Some states (and New York City) have enacted laws governing these tools, primarily focused on the potential for bias and discrimination. However, most decisions made by AI are still made without the knowledge of job seekers.
Pauline Kim, an employment law professor at the University of Washington School of Law, said this is not the first time the Fair Credit Reporting Act has been used to challenge big data hiring systems, but it is the first time one of these cases has focused on AI.
What this means for you: If the lawsuit is successful, which could take years, Kim said, AI recruiting tools may become more candid about the data they collect and go further to ensure accuracy. But the 55-year-old law this lawsuit relies on may not fully capture modern usage, either.
The real implication, Kim said, is that companies that rely on these tools need to be more transparent about their use. “However, because this law was written in an earlier era, even if the courts applied it, there would be limited transparency and probably not enough to ensure the fairness of these systems.” —PK
This report was originally published by: Techbrew.
