Scale AI Under U.S. Department of Labor Investigation Over Worker Classification Issues

Scale AI Under U.S. Department of Labor Investigation Over Worker Classification Issues

The U.S. Department of Labor (DOL) is investigating the data-labeling startup Scale AI for compliance with the Fair Labor Standards Act. Image : Google That’s a federal law that regulates unpaid wages, misclassification of employees as contractors, and illegal retaliation against workers. The investigation has been active since at least August 2024. And it’s ongoing, according to a person directly familiar with the matter.  The mere existence of an investigation doesn’t mean Scale AI has done anything wrong, of course, and the investigation could find in favor of the company or be dismissed. Scale AI is based in San Francisco and was valued last year at $13.8 billion. It relies on an army of workers it categorizes as contractors to do essential AI work, like labeling images for Big Tech and other organizations. Scale AI spokesperson Joe Osborne said that the investigation was initiated during the previous presidential administration and that Scale AI felt that its work building, testing, an…