Facebook parent company Meta has been sued by 26 former employees who filed a lawsuit in the U.S. federal court in Oakland, California. They accused the company of using artificial intelligence (AI) systems to assess employee performance during this year’s large-scale layoffs, resulting in unfair treatment of employees who had taken medical leave, had disabilities, or needed to care for family members, allegedly violating federal and state laws. Meta denied the allegations, emphasising that layoff decisions were made by managers rather than AI.
According to Reuters, the lawsuit was filed on July 13. The plaintiffs came from six states, including California and New York, as well as Washington, D.C. They were all notified in May this year that their positions would be eliminated from July 22.
The lawsuit stated that during this year’s elimination of thousands of positions, Meta used multiple internal AI systems to analyse employees’ work records, including communication content, documents, emails, browser usage, as well as work productivity and AI tool usage (AI Tokens). The data was used to score and rank employees, with those receiving lower scores being placed on the layoff list.
The plaintiffs argued that employees who took leave due to health issues, disabilities, or family caregiving responsibilities had relatively lower work output and AI tool usage, which affected their scores and placed them at a disadvantage in the layoff process.
The plaintiffs are now seeking a preliminary injunction from the court, requesting that Meta suspend the termination of their positions while the dispute is handled through private arbitration.
Commentary:
Even though Meta denies that AI made the layoff decisions, if AI scoring has become an important reference for management, companies still have a responsibility to ensure that algorithms do not create systematic bias against certain groups. If companies rely too heavily on data metrics, they risk overlooking employees’ actual contributions and may unintentionally place legally protected groups at a disadvantage.
As more companies apply AI in recruitment, performance evaluations, and layoff procedures, establishing transparent, fair, and accountable regulatory mechanisms has become an urgent priority. Companies should regularly review AI models for potential bias and establish human review and appeal processes to prevent algorithmic errors from causing talent loss and weakening long-term competitiveness.
AI can certainly improve management efficiency, but when it comes to major decisions affecting employees’ livelihoods and career development, the final decisions should still be made by humans and remain subject to legal and social oversight.