Meta faces lawsuit over AI-driven layoffs targeting workers on leave

Twenty-six Meta employees have filed a federal lawsuit alleging the company used artificial intelligence systems to identify workers for layoffs in ways that disproportionately targeted those on medical, parental, or family leave.

The lawsuit, filed in Oakland federal court, challenges Meta's May announcement that it would eliminate 8,000 positions—roughly 10 percent of its workforce. According to the complaint, the company relied on internal AI systems, keystroke monitoring, activity tracking, AI token-usage dashboards, and algorithmically assisted performance rankings to determine which employees would be cut.

The core allegation

The plaintiffs argue these automated scoring systems are structurally biased against workers exercising protected leave rights. Performance metrics "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 states. The company allegedly failed to pause these systems or conduct individualized reviews that account for protected absences, as required by law.

All 26 anonymous plaintiffs took protected leave and either requested or received disability accommodations. Their separations are scheduled to begin July 22. About half took caregiving or pregnancy-related leave, including eight women on maternity leave, four men on parental leave, and one woman on family care and bereavement leave.

One employee disclosed a serious health condition approved by Meta's own medical provider but was allegedly discouraged from taking leave by a manager who warned it would result in selection for layoffs. The lawsuit claims Meta offered no accommodation for his disability.

Why it matters

This case arrives as companies increasingly deploy algorithmic systems for workforce management decisions, raising questions about whether automation can inadvertently encode discrimination. The lawsuit invokes "disparate impact" doctrine—the principle that facially neutral policies can be discriminatory if they disproportionately burden protected groups without business necessity. While the Trump administration has moved to deprioritize federal enforcement of disparate impact claims, the legal theory remains available through private litigation and state laws. This case could establish important precedent for how courts evaluate AI-driven employment decisions that systematically disadvantage workers exercising legally protected rights.

Legal framework

The complaint cites violations of the Family and Medical Leave Act, Americans with Disabilities Act, Pregnancy Discrimination Act, and Pregnant Workers Fairness Act. It specifically invokes Title VII's prohibition on practices with disparate impact, referencing the landmark 1971 Supreme Court ruling that established the doctrine.

The plaintiffs' lawyers argue Meta's algorithmic selection process "falls more heavily on women than on men" because women disproportionately take pregnancy and caregiving leave. They're seeking to preserve employment status pending arbitration, noting that once separations are final, "the harms are irreversible: employer-subsidized health coverage lost during pregnancy, postpartum recovery, and active medical treatment; time-bound leave rights extinguished; unvested equity forfeited; and immigration consequences triggered."

Meta denied the allegations in a statement: "The claims lack merit and are not based on facts. Workforce management and organizational decisions were and are made by people, not AI."

These details were first reported by the Associated Press through Barbara Ortutay and Alexandra Olson.