Scale AI, a company once valued at $13.8 billion, is currently embroiled in its third lawsuit over alleged labor practices within just over a month. The most recent allegations bring to light claims of psychological trauma experienced by workers who were required to review and create disturbing content without adequate safeguards. This class action complaint was filed on January 17, 2024, in the Northern District of California, adding significant scrutiny to the company’s labor practices.
The lawsuit features six plaintiffs, all of whom claim they were assigned to create graphic prompts associated with violence and abuse, including sensitive topics like child abuse, on Scale's platform known as Outlier. These workers assert they lacked proper psychological support and faced retaliation whenever they tried to seek help for their mental health issues. They also allege they were misled about the nature of the work when they were hired, leading to long-term psychological impacts such as PTSD. They are now demanding the establishment of medical monitoring programs, new safety standards, and unspecified damages and attorney fees.
This lawsuit is part of a troubling pattern for Scale AI, following two previous complaints filed against the company. One such complaint came earlier this month from former worker, Steve McKinney, who accused Scale AI of misclassifying contractors and failing to pay minimum wage. This aligns with another complaint lodged back in December 2024, which raised similar concerns around worker misclassification and inadequate compensation.
Scale AI's business model heavily relies on contractors for various operational tasks, including evaluating AI model responses. Despite the company's assertions of adhering to labor laws, the current wave of lawsuits has sparked widespread questions surrounding the treatment and monitoring of their workforce.
Joe Osborne, Scale AI's spokesperson, has strongly contested the claims made by the plaintiffs, characterizing the arguments presented by Clarkson Law Firm as “misguided.” Osborne emphasized the supposed safeguards Scale has introduced to protect its workers, which include providing advanced notice about sensitive material, allowing workers the option to opt-out of certain tasks, and access to health and wellness programs. He stressed, "Scale does not engage in projects involving child sexual abuse material.”
Notably, this is not the first time Clarkson Law Firm has pursued legal action against tech companies. Previously, the firm filed a class action lawsuit against prominent firms such as OpenAI and Microsoft, but this was dismissed after the judge criticized the filing for its excessive length and irrelevant content. Referencing this, Osborne pointedly remarked on the firm’s history of targeting innovative tech companies with claims often dismissed by the judicial system. He remarked, "Clarkson Law Firm has previously — and unsuccessfully — gone after innovative tech companies with legal claims...that were summarily dismissed."
Nevertheless, Glenn Danas, partner at Clarkson Law Firm, counters Osborne's assessments by accusing Scale AI of exploiting its labor force. He argues, "We must hold these big tech companies like Scale AI accountable or workers will continue to be exploited to train this unregulated technology for profit.” This highlights the tension between ensuring worker rights and the operational practices of large tech firms.
With these lawsuits underway, Scale AI is facing considerable pressure from both the legal system and public opinion, compelling the company to address substantial concerns surrounding the treatment of its workforce. The significance of these cases not only reflects on Scale AI’s practices but also sheds light on wider labor issues faced by many tech companies today, raising questions about the ethical responsibilities of those operating within the rapidly growing AI sector.