The U.S. Department of Labor is investigating Scale AI, a data labeling startup backed by Nvidia, Amazon, and Meta, over its compliance with fair pay and working condition standards under the Fair Labor Standards Act, the company said on Thursday.
The California-based firm disclosed that the investigation began nearly a year ago during former President Joe Biden’s administration. It has since been working with the department to clarify its business model and the role of data labeling in the artificial intelligence industry.
Founded in 2016, Scale AI specializes in providing large-scale, accurately labeled datasets crucial for training advanced AI systems such as OpenAI’s ChatGPT. It also operates a platform where researchers exchange AI-related information, with contributors spanning more than 9,000 cities and towns.
A company spokesperson stated, “The feedback we receive from contributors is overwhelmingly positive, and we have dedicated teams to ensure people are paid fairly and feel supported.” Scale AI added that nearly all contributor payments are made on time, with 90% of payment-related inquiries resolved within three days.
Valued at $14 billion in a funding round last year, Scale AI counts OpenAI, Cohere, Microsoft (MSFT.O), and Morgan Stanley (MS.N) among its clients.
