How AI-Based Performance Tracking Can Lead to Unfair Termination

AI-based performance tracking is becoming more common in today’s workplace, especially in jobs where productivity can be measured through data. These systems can monitor output, compare employees to benchmarks, and flag potential performance issues.

However, automated tracking does not always capture important context, such as changing expectations, workload differences, technical problems, or disability-related limitations. When employers rely too heavily on AI-generated reports to justify discipline or termination, it can lead to unfair outcomes, including wrongful or discriminatory firings.

Can AI Lead to Wrongful Termination in California?

Yes. AI performance systems create wrongful termination risks in several ways.

• Biased algorithms: The AI learns from historical data that reflects past discrimination, then replicates those patterns against current employees.
• Incomplete data analysis: The system measures activity metrics without understanding context, quality, or external factors affecting your work.
• Proxy discrimination: The AI flags workers based on characteristics that correlate with protected classes like age, disability, or family status.
• Lack of human oversight: Managers accept AI recommendations without independent investigation or employee input.

California Law Protects You From AI-Driven Wrongful Termination

California provides strong protections against wrongful termination, regardless of whether a human or an algorithm made the discriminatory determination.

Fair Employment and Housing Act (FEHA) Protections

California’s Fair Employment and Housing Act prohibits termination based on protected characteristics, including age, race, gender, disability, religion, sexual orientation, pregnancy, and medical conditions.

Under FEHA, employers cannot:

• Terminate employees based on discriminatory criteria
• Use employment practices that have a disparate impact on protected groups
• Retaliate against employees who complain about discrimination
• Fail to provide reasonable accommodations for disabilities

Companies cannot deflect liability by claiming “the AI system made the decision.” If the termination violated California law, the employer faces full liability.

Whistleblower Protections Under California Labor Code

California’s Labor Code Section 1102.5 protects employees who report unlawful practices. If you raised concerns about discriminatory AI systems and were subsequently terminated, you may have a retaliation claim.

Federal Protections That Apply in California

The Age Discrimination in Employment Act (ADEA) protects workers 40 and older from age-based discrimination. The Americans with Disabilities Act (ADA) requires reasonable accommodations for disabilities.

Common Ways AI Performance Evaluations Lead to Unlawful Termination

AI-driven terminations frequently violate employee rights in specific, identifiable patterns.

Age Discrimination Through Productivity Metrics

AI systems often measure productivity using metrics that disadvantage older workers.

An algorithm might penalize employees for:

• Slower typing speeds
• Fewer instant message responses
• Lower adoption rates of new software
• Different communication styles
• Taking more time on complex tasks

Disability Discrimination in Monitoring Systems

Performance monitoring systems frequently flag workers with disabilities.

Examples include:

• An employee with chronic pain takes more breaks
• A worker with anxiety has lower video camera usage during meetings
• Someone with ADHD has different work patterns than neurotypical colleagues
• An employee with mobility limitations has different office presence patterns

Pregnancy and Family Caregiving Discrimination

AI systems monitor work hours, response times, and availability patterns.

Pregnant employees or those with caregiving responsibilities may show different patterns than workers without these obligations.

They might:

• Log fewer evening or weekend hours
• Take more medical appointments
• Have different response time patterns
• Request schedule flexibility

Retaliation for Protected Activities

Some AI systems flag employees for “negative sentiment” in emails or communications.

If you complained about discrimination, harassment, wage violations, or safety issues, the AI might identify your complaints as negative behavior. Terminating you based on this analysis constitutes unlawful retaliation under California law.

Warning Signs Your Termination May Be Unlawful

Not every AI-involved termination is wrongful. However, certain patterns suggest potential violations.

You may have been wrongfully terminated if:

• Your termination was based primarily on AI-generated scores without independent human review of your actual work quality
• You consistently met stated job requirements and received positive feedback before the AI evaluation
• You belong to a protected class and the AI system disproportionately flags workers in your category
• The performance metrics measured do not directly relate to your essential job functions
• Your employer refused to explain the specific AI criteria or provide access to the data
• You requested a reasonable accommodation for a disability and were subsequently flagged
• You raised concerns about discrimination shortly before the AI marked your performance as deficient
• Colleagues with similar or worse performance were not terminated

Steps to Take After an AI-Based Wrongful Termination

If you believe an AI performance evaluation led to your unlawful termination, take action promptly.

Document Your Termination and Employment History

Gather and preserve:

• All performance reviews, emails, and communications about your work quality
• The termination notice and the reasons for your firing
• Any information provided about AI or automated systems used to evaluate performance
• Documentation of protected class membership if relevant (medical records, birth certificates)
• Evidence of complaints you made about discrimination, harassment, or illegal activity
• Correspondence where you requested accommodations or disclosed disabilities
• Examples of your actual work product showing quality performance

Request Information About the AI System

California law may provide rights to understand how automated systems affected your employment.

Send a written request to your former employer asking:

• What AI or automated monitoring systems were used to evaluate performance
• What specific data points and metrics the system analyzed
• How the AI weighted different factors in its assessment
• Whether the system has been tested for bias or disparate impact
• What human review occurred before the termination decision
• Whether other employees were similarly evaluated and the outcomes

Your employer may not provide complete answers. Their response or silence can be revealing and useful for your case.

File Complaints With Appropriate Agencies

California Civil Rights Department (CRD): File a complaint with the CRD for discrimination claims. You can file online or by mail. The CRD will investigate and can issue a right-to-sue notice allowing you to file a lawsuit.

Filing deadlines: You have three years from the discriminatory act under California law, though filing promptly preserves evidence and witnesses.

Equal Employment Opportunity Commission (EEOC): For federal claims under ADEA or ADA, you can also file with the EEOC.

Consult a California Employment Attorney

An experienced employment attorney can:

• Evaluate whether your termination violated California law
• Identify which legal claims apply to your specific situation
• Calculate potential damages, including lost wages, emotional distress, and punitive damages
• Investigate whether other employees were similarly affected by the AI system
• Subpoena information about the AI algorithm and its testing
• Negotiate a settlement or file a lawsuit on your behalf
• Represent you throughout administrative proceedings and litigation

Employer Responsibility When AI Evaluates Your Performance

Employers who deploy AI performance systems remain fully responsible for discriminatory outcomes, regardless of what the algorithm recommends.

They must:

• Conduct independent reviews of employee performance
• Consider the context that AI cannot measure
• Allow employees to respond and provide input
• Evaluate whether protected characteristics influenced the AI determination
• Test systems for bias and disparate impact
• Provide reasonable accommodations when required

When companies fail to meet these obligations, California law provides remedies including reinstatement, back pay, front pay, compensation for emotional distress, punitive damages, and attorney fees.

Wrongfully Fired by an Algorithm? Contact TONG LAW

Were you terminated after an AI system flagged your performance? Do you suspect the algorithm discriminated against you based on age, disability, pregnancy, or another protected characteristic?

At TONG LAW, we represent California employees who have been wrongfully terminated, including cases involving AI-driven employment decisions. We understand how artificial intelligence systems can violate worker rights under California law.

Contact TONG LAW today for a consultation about your wrongful termination case. We represent employees throughout Oakland, Sacramento, and across California.