Due to numerous competing AI systems overwhelming online job application portals, applying for a new job in 2026 often feels more akin to applying for a bank loan than actually seeking employment. At least, that’s the claim made by a group of frustrated job seekers in a lawsuit against an AI screening company called Eightfold AI. According to the New York Times, the plaintiffs argue that Eightfold’s employment screening software should fall under the Fair Credit Reporting Act — the set of regulations that protect information collected by consumer credit agencies. Their reasoning lies deep within Eightfold’s AI algorithm, which scours LinkedIn to compile a dataset comprising “1 million job titles, 1 million skills, and profiles of more than 1 billion people working across every job, profession, industry, and location. ” This extensive dataset is subsequently used in marketing materials to promote Eightfold’s services to potential clients. Based on an AI model trained on this data, the plaintiffs claim Eightfold rates job applications on a scale from one to five, evaluating candidates’ skills, experience, and the hiring manager’s objectives. Essentially, their argument compares this process to the opaque criteria used to calculate consumer credit scores. However, with Eightfold, applicants have no insight into their actual score or the methodology behind it. This creates a “black box” scenario: candidates see only the algorithm’s decision, not the rationale behind it. Moreover, if Eightfold’s AI fabricates information on the spot—as AI models are notoriously known to do—applicants remain unaware. An additional concern is data retention.

Without transparency into the system’s workings, it’s unclear how much information from applicants’ résumés Eightfold collects or how the AI company and its clients utilize that data. “I believe I have the right to know what’s being collected about me and shared with employers, ” Erin Kistler, one of the plaintiffs, told the New York Times. “But they’re not providing any feedback, so I can’t improve my chances. ” Kistler, who has decades of experience in computer science, revealed that she’s meticulously tracked every job application she’s submitted over the past year. Out of “thousands of applications, ” she said only 0. 3 percent progressed to follow-ups or interviews. All of this highlights the grim realities of the job market, which has taken on a dystopian character due to AI hiring tools. Whether this lawsuit will gain sufficient traction to challenge the vast legal ambiguities surrounding AI in hiring remains uncertain. If successful, it could offer much-needed relief to countless discouraged job seekers whose careers depend on these opaque systems. Eightfold AI did not respond to the New York Times’ request for comment.