Salary negotiations — among the most high-stakes, emotionally fraught and psychologically complex processes many employees will ever experience — could soon get the artificial-intelligence treatment, Axios' Ryan Heath reports.

What's happening: Pactum AI, the world's largest provider of automated procurement negotiation, has been using AI chatbots to negotiate the packages of its employees since 2021.

• Ironclad, a startup backed by Sequoia and Accel, is gearing up to launch an AI agent that specializes in employment contract analysis.
• Individuals can use publicly available chatbots to role play negotiations and brainstorm compensation packages.

Why it matters: Salary negotiations are often unsatisfying and nerve-wracking for workers, time consuming for employers, and deliver subjective and unequal outcomes — so anything that might improve the process is worth considering.

• Those with the most to gain from dealing with a chatbot include people who typically do not negotiate their salary and those who want better options beyond their salary, such as additional vacation, other leave or equity.

The context: Pactum's salary chatbot was inspired by its platform for autonomous negotiations, which is used by companies such as Walmart for vendor negotiations.

• Martin Rand, Pactum's CEO, told Axios that feedback from his 80 employees is positive — and has taught the company the importance of negotiating benefits as well as salary, giving employees multiple equivalent offers to choose between.
• The chatbot also helped with achieving gender-balanced compensation, Rand said. Men and women negotiated equally hard with the bot, whereas men tended to negotiate harder than women in person, he said.

Yes, but: AI could also disadvantage workers in compensation negotiations, or leave them unsatisfied in new ways.

• Workers who aren't given full context or who provide poor prompts to the chatbot will likely be at an information disadvantage.

Reality check: Rand said right now Pactum sees difficulties in operating a salary chatbot at scale, and the company plans to stay focused on automating procurement negotiations.

What they're saying: "A human will have to constantly calibrate this chatbot," Adam Niewinski, co-founder of VC firm OTB Ventures and a former bank executive, told Axios.

• "The salary chatbot reduces biases of managers and can get a better deal for both sides," Rand said.
• Rand predicted a future of "constantly adjusting benefits," made possible by bots with unlimited time to negotiate when worker priorities change — or perhaps when companies either need to tighten their belts, or have resources to offer bonus compensation.

The other side: Other players in labor negotiations, from unions to tech startups, see opportunity in having AI assist in traditional contract talks.

• American Federation of Teachers president Randi Weingarten told Axios that "AI has the potential to help" so long as it's a supplement rather than substitute for human input, and each side has access to a given tool's benefits.
• "There are elements of collective bargaining, such as costing out contracts, where smart technology has and could play a role. But the key to successful negotiations is relationships, not automation," Weingarten said.
• "Negotiation is an inherently human interaction that requires human intelligence. Tools that use AI to assist negotiation will win, and those using AI to entirely automate the process will lose," Ironclad CEO Jason Boehmig told Axios.

Hugging Face raised $235 million in funding led by Salesforce Ventures in a Series D round that values the provider of open-source tools for developing AI at $4.5 billion, Axios' Kia Kokalitcheva reports,

Why it matters: The New York-based company is at the center of a growing community of AI developers.

• Hugging Face bills itself as the "GitHub for machine learning."

What they're saying: "[GitHub is] very much focused on code, and we're very much focused on AI, and we actually collaborate with them a lot," Hugging Face co-founder and CEO Clément Delangue tells Axios when asked about potential competition from GitHub.

• Delangue's seeming lack of worry about Microsoft-owned GitHub is notable given the tech giant's aggressive push into AI. It's already deploying the tech into some of its products (and GitHub's 2-year-old AI assistant is quite popular).

Zoom in: Along with Salesforce and Sound Ventures, Hugging Face's new backers include a slew of other major tech companies: Google, Amazon, Nvidia, Intel, AMD, Qualcomm and IBM.

By the numbers: The company says it's now hosting 500,000 models, 250,000 data sets and 250,000 apps, and aims to triple its numbers in 2024.

• It recently crossed the 1 million repositories mark, and aims to reach "tens of millions" next year.
• Forbes reported that it brought in $10 million in revenue in 2021, and now has an annualized revenue of between $30 million and $50 million. Delangue declined to comment on specific numbers but said that revenue has grown fivefold this year, and it now has 10,000 paying customers (it sells enterprise features).

The FCC is grappling with what a fair price should be for placing a call from a correctional facility, Axios Pro's Maria Curi reports.

Why it matters: How the FCC implements the Martha Wright-Reed Act, which empowers the agency to cap the cost of a phone or video call made by an incarcerated person, will affect families throughout the country.

State of play: Under the law, signed in January, the FCC must complete the rulemaking between June and December 2024.

• Advocates and telecommunication companies don't agree on what should be factored into the cost of placing a call from prison, a financial burden that often falls on the poorest families in the U.S.

Catch up fast: Although the Martha Wright-Reed Act gives the FCC the power to regulate video calls for the first time, the agency does have a history of regulating phone calls.

• Today, calls made across state lines have a cap of 12 to 14 cents per minute at larger correctional facilities. At smaller facilities, it's 21 cents per minute.
• Most incarcerated people have ended up paying similar rates for in-state and out-of-state calls — in part because it's difficult for companies to track where the call is going — but some are still paying what advocates say are exorbitant rates.

The big picture: Activists view prison phone justice as part of the larger issue of mass incarceration. The various U.S. criminal justice systems — state and federal prisons, local jails and other types of correctional facilities — hold nearly 2 million people behind bars.

Yes, but: Getting reliable data from companies will be key to properly assess how much it should cost to place a phone or video call.

What they're saying: "The FCC has for years attempted to address this terrible problem, but we had been limited in the extent to which we can address rates for calls made within a state's borders and consider industry-wide costs," an FCC spokesperson said.

What's next: Although the FCC could never require companies to offer a free service, state and local governments that run correctional facilities can choose to treat calls like electricity or heat and cover the expense.

A version of this story was published first on Axios Pro. Unlock more news like this by talking to our sales team.

• Meta released Code Llama, a generative AI tool for writing computer code, free for both commercial and research use under similar terms to its broader Llama 2 tool. (The Verge)
• T-Mobile is laying off 5,000 workers, around 7% of its staff. (GeekWire)
• A federal judge dismissed the Republican National Committee's lawsuit claiming that Google's Gmail spam filters unfairly blocked GOP candidates' messages. (Washington Post)

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