Eightfold faces lawsuit over alleged secret AI screening of candidates

The proposed class action argues the practice should be treated like consumer reporting in hiring, bringing the company’s AI assessments under long-standing disclosure and accuracy rules.

Complaint was filed by Erin Kistler and Sruti Bhaumik, who say they applied for roles at companies using Eightfold’s tools and were not hired, and they believe the assessments contributed to their rejections. They are seeking to represent a nationwide class of US job seekers evaluated through Eightfold’s system.

At the center of the case is the allegation that Eightfold created talent profiles and related outputs that go beyond basic resume parsing. The suit says the system generated personality-style descriptors such as “team player” and “introvert,” ranked applicants’ “quality of education,” and produced predictions about future job titles and companies. The plaintiffs argue applicants were not given the disclosures typically required when third parties compile evaluative reports used in employment decisions.

The lawsuit also describes scoring mechanics that plaintiffs say were kept from applicants. A separate report on the case said the system assigned job seekers a score on a 0-to-5 scale, and Eightfold’s own public documentation for a matching model describes a 0–5 match score range tied to candidate-to-job pairing.

Legal claims lean on the idea that AI-driven evaluations are still covered by existing consumer protections when they function like background checks or employment screening reports. The plaintiffs cite the Fair Credit Reporting Act and California consumer laws that give individuals rights to access and challenge reports used for hiring, arguing there is no special carve-out for algorithmic assessments.

Eightfold’s platform is used by large employers, and the complaint references applications connected to major companies. Microsoft and PayPal are mentioned as companies that use the tools, though neither is a defendant in the case. Eightfold did not immediately comment in the coverage describing the lawsuit.

In the background, Eightfold’s technology is also used in public-sector job matching. New York’s labor department has promoted an expanded virtual career center described as being powered by Eightfold, and Colorado’s state job-seeker site includes help-center material that references Eightfold in its service.