Workday made a few key arguments:
1. California law shouldn’t apply: Workday argued that California’s anti-discrimination laws shouldn’t govern hiring decisions involving applicants outside California or jobs located in other states and countries. The judge rejected that argument.
2. It shouldn’t be treated as the decision-maker: Throughout the litigation, Workday has generally argued that employers, not Workday, make the ultimate hiring decisions. Their position is that they provide software tools, while companies decide whom to interview and hire.
3. The disability discrimination allegations were too speculative: Workday sought dismissal of claims that its AI could screen out disabled applicants through proxy indicators like employment gaps.
The judge declined to dismiss those claims, meaning plaintiffs can continue pursuing them.
Stanford University researchers analyzed 4 million job applications and found that 26% of Black applicants and 15% of Asian applicants applied to jobs where AI hiring systems worked against their racial group.
The researchers estimate that if those candidates had been recommended at the same rate as the most-favored group, roughly 40,000 additional applications would have advanced to the next stage of hiring.
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