Meta faces lawsuit from 26 employees over AI-based layoffs

A group of 26 Meta employees has sued the company, claiming it used artificial intelligence (AI) systems to select people for layoffs, disproportionately targeting those on medical, parental or family leave.

They are among the 8,000 employees, or about 10% of its workforce, Meta said it would lay off in May. The lawsuit filed late Monday in federal court in Oakland, California, claims the company used internal AI systems, keystroke and activity-monitoring data, AI token-usage dashboards and algorithmically assisted performance rankings, among other methods, to determine who would be laid off.

Many of these scores and ratings “by design, cannot be accumulated by an employee who is on protected medical or family leave, or whose output is reduced by a disability,” the lawsuit says.

Meta, according to the lawsuit, did not account for protected leave when taking employees' scores into account and “did not pause the system for the individualised, leave- and accommodation-neutral review that the law requires.”

As a result, people on protected medical or family leave were disproportionately selected for layoffs, the lawsuit says. Each of the 26 anonymous employees in the lawsuit took protected leave and requested or received a reasonable accommodation for disability. Though they have been notified of their layoffs, all 26 remain employed by Meta, with separations set to begin July 22.

Many workers were on parental leave

Many of the employees in the lawsuit took pregnancy or parental leave, during which time they wouldn't have worked and thus had their measured output reduced. Others took medical leave, one disclosed a “serious health condition and disability” that was approved by Meta's own provider.

But according to the lawsuit, he was “discouraged and deterred from taking that leave by a manager” who warned that doing so would result in his selection for the anticipated layoffs. Meta offered no accommodation for his disability, the lawsuit says.

Meta said in a statement that the claims "lack merit and are not based on facts. Workforce management and organisational decisions were and are made by people, not AI.”

About half the plaintiffs had taken leave for caregiving or pregnancy-related reasons. Eight are women who had taken maternity or pregnancy-related leave, four are men who had taken parental leave and one is a woman who had taken leave to care for a family member and later bereavement leave.

The lawsuit says the layoffs violated several state and federal laws, including the Family and Medical Leave Act, the Americans with Disabilities Act, the Pregnancy Discrimination Act and the Pregnant Workers Fairness Act.

Lawsuit cites disparate impact

The complaint also references “disparate impact liability,” a longstanding civil rights concept that President Donald Trump's administration moved to abandon. Disparate impact, codified in Title VII of the 1964 Civil Rights Act, holds that facially neutral policies or practices can be discriminatory if they disproportionately burden a protected class of workers and aren't necessary for the job.

The Trump administration has ordered federal agencies to deprioritise disparate impact liability enforcement, arguing that its use undermines “meritocracy” and encourages the assumption that any racial or gender imbalance in a workforce is the result of discrimination. The order has led the Equal Employment Opportunity Commission to drop discrimination cases on behalf of some workers.

However, the lawsuit against Meta underscores that companies remain vulnerable to disparate impact litigation in the age of AI despite the Trump administration's efforts to stamp out its enforcement. Workers are still free to pursue such lawsuits on their own if the EEOC rejects their complaints, and several state laws specifically prohibit disparate impact discrimination.

In the case against Meta, lawyers for the plaintiffs argued that the company's “algorithmically assisted selection process, by systematically recording such absences as reduced performance, falls more heavily on women than on men.” That's because women disproportionately take pregnancy and caregiving leave, according to the lawyers. The lawsuit cites Title VII's prohibition on employment practices that have a disparate impact, as well as a landmark 1971 Supreme Court ruling that recognised the doctrine.

The plaintiffs' lawyers said in a statement that the lawsuit asks for one thing--preserving the status quo to keep the workers employed pending arbitration. That's because “once these separations are final, the harms are irreversible: employer-subsidised health coverage lost during pregnancy, postpartum recovery, and active medical treatment; time-bound leave rights extinguished; unvested equity forfeited; and immigration consequences triggered.”