From JDSupra, Richard Reibstein discusses a recent lawsuit filed by a data annotator (a person who labels, tags, or categorizes data (like images, text, audio, or video) so that machine learning models can understand and learn from it) alleging that they were misclassified as independent contractor. Richard writes:
ARTIFICIAL INTELLIGENCE COMPANY SUED BY DATA ANNOTATORS IN CLASS ACTION LAWSUIT FOR IC MISCLASSIFICATION. A data annotator has filed a proposed class action lawsuit in California state court against an AI training company for violations of the state’s wage and hour laws as a result of the company’s alleged misclassification of the data annotators as independent contractors. According to the complaint, the company, Surge Labs. Inc. d/b/a DataAnnotation, engages data annotators to work on projects for customers using AI and to perform coding assignments, distillation tasks, comparisons of AI generated responses, and data labeling to ensure that large language models become more accurate and capable of mimicking human expression. The company’s platform provides the annotators with “a queue of tasks, which are assigned to them via an automated algorithm.” The plaintiff claims that the company requires the data annotators to undergo training for which they are not paid, determines which projects are offered to them as well as fees the annotators receive for a project, sets time limits for tasks, and provides the instrumentalities that it requires the annotators to use for their work. Cavalier v. Surge Labs Inc., No. (Cal. Super. Ct. San Francisco County May 20, 2025).