Scale AI under fire in suit filed by former worker alleging unlawful business practices

A new class action lawsuit alleges poor working conditions and “exploitive” behavior by AI data processing company Scale AI, saying that workers responsible for generating much of its product were mischaracterized by the company as independent contractors, rather than full employees.

Scale AI’s core business centers on using human input to label and shape AI responses to queries, helping to make responses more accurate and usable. For instance, a worker might label images from a car’s LIDAR detector to help create an AI that more accurately identifies objects.

To get this kind of human input, according to a complaint filed Tuesday in the Superior Court of California, Scale AI outsources work through services like Outlier, where named plaintiff Steve McKinney worked until June. Tasks for Scale AI, the complaint alleges, were assigned algorithmically, with payments reduced or denied for projects that exceeded a designated time limit. McKinney’s suit said that this amounts to a bait-and-switch in terms of promised compensation. In addition, it noted, workers were not paid for peripheral functions such as reviewing project guidelines, seeking clarification, or attending required training webinars.