TechCrunch has learned that the United States Department of Work (Dol) is investigating the evaluation of the scale of data labeling startups in terms of compliance with the Act on honest work standards.
This is a federal law, which regulates unpaid wages, incorrect classification of employees as contractors and illegal retaliation against employees.
The investigation was lively since at least August 2024, shows the document visible by TechCrunch. And this continues, based on a person directly familiar with this matter.
The very existence of an investigation, of course, does not mean AI scale, and the investigation might be found in favor of the company or be dismissed.
Scale AI is based in San Francisco and was valued last 12 months at $ 13.8 billion. He is based on the army of employees, which he categorizes as contractors to perform the crucial work of artificial intelligence, corresponding to photo label for large technology and other organizations.
AI Scale spokesman, Joe Osborne, told Techcrunch that the investigation was initiated during the previous presidential administration, and AI Scale thought that his building, testing and assessment of AI was then misunderstood by the regulatory authorities.
Osborne said that AI Scale worked intensively with Dols to clarify its business model and the talks were productive. Generally speaking, Osborne said that AI Scale provides Americans with more “flexible work opportunities” than any other company, and the feedback from its colleagues is “predominantly positive.”
“Hundreds of thousands of people use our platform to present their skills and earn extra money,” said Osborne.
Scale AI is actually a popular concert work platform. But recently he faced the legal challenges of some former employees related to work practices. Two lawsuits were against the startup – one in December 2024, and the other in January 2025 – from former employees claiming that they were insufficiently rewarded and incorrectly classified as contractors as a substitute of employees, refusing to access them to protection, corresponding to time beyond regulation and sick time.
Scale AI strongly questioned the lawsuits, saying that it is fully consistent with the law and is working to make his salary rates meet or exceed local standards of life remuneration.
International work practices AI Scale were also the subject of investigation by Washington Post in 2023. Foreign employees described the post by requiring work at low salaries as contractors. The company said in a time that salary rates are always improving.
US Department of Work website He says that he is capable of resolve most cases of administratively, but employers who violate the law could also be subject to fines and potentially imprisonment. Dols also have the power to force employers to reclassify their employees as employees.
For example, in February 2024, the Startup of the Hotel staff Qwick decided the Dol’s case, paying $ 2.1 million and announcing that each one California employees Reported.
It also seems that AI Scale belongs to the Silicon Valley corporations looking for and see the favor of the recent presidential administration. For example, its general director and founder Alexandr Wang attended The inauguration of Donald Trump in January, like many other technical directors.
More eloquent, former managing director of AI, Michael Katsios, is the nominated president of Trump as a recent director of the Bureau of Science and Technology of the White House. Kitsios previously served as the US technology director during the first Trump administration.
In this position, Katsios will advise Trump on science and technology. This position has no supervision over the Labor Department. KRatsios was part of the Senate hearing February 25, but has not yet been confirmed. Kitsios didn’t answer the request for comment.
A spokesman for the US Department of Labor, Michael Petersen, told Techcrunch that he cannot confirm or deny any investigation, for a long -term policy.