Overview
A lawsuit was filed against Eightfold in January 2026. The suit claims the ratings assigned by A.I. screening software are similar to those of a credit agency and should be subject to the same laws.
What we can say to customers
We are aware of the recent Eightfold litigation filed in January 2026 and continue to track any such litigation related to the use of AI tools in employment practices. While we are not in any way involved in the litigation itself, we do note that there are several fundamental differences in the way Eightfold's tools, as described in the litigation, differ from the way Gem’s AI Features operate. Most notably, our tools are guided by several principles which differentiate our approach:
- Customer control: AI features are opt-in tools customers choose to use, not automatic backend scoring systems. Recruiters and recruiting teams actively decide whether to use AI Ranking on specific applications, rather than every candidate being automatically processed through hidden algorithmic evaluation.
- Candidate-supplied data only: Our AI Powered Application Review provides rankings based exclusively on what candidates submit in applications - no external databases or third-party enrichment is applied in our AI Features. We also do not infer sensitive traits or make speculative predictions about a candidate beyond the evaluation context the customer is running.
- Explainable AI with customer criteria: Gem is built so customers can see what the AI is ranking on and why. Our AI enables customers to provide transparency to candidates as desired, with rankings based on customer-defined job criteria - not opaque proprietary algorithms. Recruiters can edit criteria, iterate, and provide feedback. The evaluation reflects customer specific job requirements and qualifications, not predictions trained on external hiring outcomes from other companies.
Gem remains committed to building AI tools that empower recruiter decision-making while keeping humans in control and maintaining candidate trust in the hiring process.
30-second talk track for calls:
We’re aware of it, but we can’t comment on an active case. What we can do is explain how Gem’s AI works, because our approach is built to avoid the kind of risk that comes from hidden, automatic scoring. Gem’s AI is opt-in and used intentionally by recruiters, based on candidate-supplied application data and the customer’s own criteria. Recruiters can see what the AI is ranking on, adjust the criteria, and validate results — so humans stay in control and the process is transparent.
Additional Resources
Matt’s original talking points doc can be found here.