Meta faces AI layoff lawsuit from 26 employees

• Twenty-six employees allege Meta used AI-assisted systems that unfairly penalized workers with disabilities or protected medical leave.
• Meta shares were up 0.3% at $658.91 shortly after the lawsuit was reported.
• Meta denies that AI made layoff decisions, while the employees are seeking an injunction and independent audit.

Meta Platforms (NASDAQ:META) was sued by 26 current and former employees who allege its AI-assisted layoff process disproportionately selected workers with disabilities or protected leave.

The complaint concerns Meta’s May 20 workforce reduction, which affected approximately 10% of employees across several business units and U.S. states.

The complaint alleges that Metamate, employee-trained agents, monitoring data, AI-token dashboards and algorithmic rankings treated leave-related output reductions as underperformance.

Following the announcement, Meta Platforms' share price was up 0.3% at $658.91, while the plaintiffs sought an injunction and independent audit before arbitration.

Meta began notifying employees about the reduction as it cut roughly 10% of its workforce and reassigned thousands of workers toward AI-focused operations.

Employees had previously protested Meta’s workplace-tracking technology, which the company said was intended to help train AI agents for computing tasks.