Meta employees sue over alleged AI-driven layoffs targeting workers on leave

Meta Platforms Inc (NASDAQ:META, XETRA:FB2A, SIX:FB) is facing a lawsuit from 26 employees who allege the company used artificial intelligence tools and automated workplace metrics to select workers for mass layoffs, with the plaintiffs claiming the process disproportionately affected employees...

Meta Platforms Inc (NASDAQ:META, XETRA:FB2A, SIX:FB) is facing a lawsuit from 26 employees who allege the company used artificial intelligence tools and automated workplace metrics to select workers for mass layoffs, with the plaintiffs claiming the process disproportionately affected employees who had taken protected medical, parental or family leave. The lawsuit, filed in federal court in Oakland, California, claims Meta relied on AI-assisted performance rankings, activity tracking data and internal "AI token usage" dashboards to evaluate employees during a workforce reduction process. The plaintiffs allege these systems failed to account for periods when workers were unable to generate certain productivity metrics while on approved leave.

According to the complaint, Meta used a combination of performance scores, productivity data and internal AI adoption measurements to rank employees for termination. The plaintiffs claim workers on disability, maternity or other protected leave were effectively penalized because those periods reduced the data available to the company's evaluation systems. The case relates to Meta's planned workforce reductions involving about 8,000 employees earlier this year.

The plaintiffs allege the company used automated systems to identify employees for termination rather than relying solely on managers' assessments of individual performance. The lawsuit includes claims from workers who were on approved leave when they were notified of their layoffs. One plaintiff, a scientist, alleges she was informed of her termination shortly before giving birth, while another engineer claims his rating was lowered after taking time off for an injury.

A manager also alleges he was dismissed while on medical leave. The employees are asking the court to pause the planned terminations, which are scheduled to begin on July 22, and are seeking an independent audit of Meta's AI tools. They are also seeking potential damages, including lost compensation, equity and benefits.

Meta disputed the allegations, stating that the lawsuit's claims "lack merit" and that workforce and organizational decisions are made by people, not AI. The plaintiffs also raised concerns about Meta's internal employee-monitoring program, which they claim collected workplace activity data, including device usage and productivity-related metrics. Meta previously paused the initiative following employee criticism and a petition signed by more than 1,600 workers citing privacy concerns.

Shares of Meta traded up 4% at $684 on Wednesday afternoon.