AI hiring tools are transforming the way employers find, evaluate, and hire talent. But these tools are well-known for replicating systemic bias, leading to potentially unlawful discrimination. Madsen, Prestey & Parenteau, LLC, has advocated on behalf of individuals facing bias and discrimination in the workplace for decades. Today, AI has quickly become a standard practice in how many companies recruit, evaluate, and hire employees.

At some companies, algorithms help determine which candidates move forward, and which ones do not. While some say that these systems are intended to increase efficiency and streamline the hiring process, the use of AI in the job application process carries hidden risks, particularly for members of historically marginalized groups.

How Are Companies Using AI in the Hiring Process?

AI tools can be used at virtually every step in the hiring process, from generating a job listing and posting it online to screening application materials and scheduling interviews. AI tools help HR managers write job postings, optimizing language for search visibility and tailoring job listings to attract job candidates. They filter resumes and application materials by scanning for keywords, skills, experience, and other criteria to rank certain candidates while rejecting others.

Employers are increasingly turning to AI to administer and score skills tests and personality evaluations. More sophisticated systems can evaluate applicants based on inferred skills, career progression, relevance to a particular project, and projected job fit. Chatbots and recruiting assistance can communicate with applicants by answering questions, scheduling interviews, and even conducting initial screening interviews. Some companies even use AI to transcribe and summarize conversations, evaluate tone or body language, or score applicant responses against predetermined criteria.

AI Screening Tools Can Exclude Strong Applicants

While AI can increase efficiency and streamline the application process in certain ways, highly qualified applicants may be overlooked and rejected because their application materials are missing a few words, or place them slightly outside of a company’s hiring criteria.

Despite claims of neutrality, AI tools discriminate by reproducing and amplifying human bias. When the data used to train AI systems reflects biased hiring patterns, such as favoring certain genders, races, or ages, the AI tool will replicate those biases. This can result in qualified candidates being filtered out because they do not match the profile the algorithm was trained to prefer.

California Class Action Lawsuit Challenges Bias in AI Hiring Software

Mobley v. Workday, Inc., is one of the first class-action lawsuits to allege discrimination due to algorithmic bias in AI applicant screening tools. In that case, a Black man over the age of 40 and with a disability claims Workday’s applicant screening software unlawfully discriminates against job applicants based on the protected characteristics of age, race, and disability, in violation of Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1866, the ADEA, and the ADA Amendments Act of 2008 (“ADAAA”).

The primary legal theory that survived Workday’s motions to dismiss is that Workday was acting as an agent of the employers who used its service, leading to potential liability not just for Workday, but any employer that used their software. The case was recently certified as a class action and is likely to have significant implications for the use of AI in the hiring process.

Federal and State Laws that Address the Use of AI in Hiring

While there is no federal law that currently targets the use of AI in the employment context, an employer’s use of AI remains subject to the prohibition against employment discrimination on the basis of race, color, ethnicity, sex (including gender, sexual orientation, and gender identity), age, national origin, religion, disability, pregnancy, military services, and genetic information.

In May 2026, the Connecticut legislature passed Senate Bill 5 (the “Connecticut Artificial Intelligence Responsibility and Transparency Act”), which addresses the use of AI in hiring, recruiting, and personnel decisions. Beginning October 1, 2027, employers that use an “automated employment-related decision technology,” defined broadly to include any technology that processes personal data and produces an output, such as a score, rank, constraint, recommendation, or classification as a substantial factor in making, or materially influences, an employment-related decision, must disclose that the applicant is interacting with technology. Violations of the law will be deemed unfair or deceptive trade practices, but will not grant individuals a basis upon which to file a lawsuit seeking monetary damages or equitable relief. However, the Act specifies that the use of AI will not be a viable defense against claims of discrimination.

What To Do If You Suspect AI Bias in Your Job Application?

If you suspect you were rejected because of an AI algorithm that unlawfully discriminated against you, contact the employment discrimination attorneys at Madsen, Prestey & Parenteau, LLC, today. Our attorneys have decades of experience, a track record of success, and passion and dedication to helping people protect their livelihoods. Call us today at (860) 246-2466 or contact us online to discuss your case and protect your rights.