A recently terminated Tesla employee filed a lawsuit against the company Tuesday, claiming the automaker violated a California state law by failing to give proper notice when it allegedly laid off hundreds of workers this month.
The situation dates to earlier this month, when Tesla confirmed that it was firing hundreds of employees at departments across the company. Tesla said it was due to annual performance reviews, but employees have since claimed they were blindsided by the decision.
That includes Abraham Duarte. In a six-page complaint filed in Alameda County Superior Court on Tuesday, Duarte says he and âother similarly situated employeesâ were dismissed by Tesla as part of a layoff ordered by the automaker. The suit claims Tesla âacted intentionally and with deliberate indifferenceâ to the employees by failing to provide proper note of the mass terminations under Californiaâs WARN Act.
State law requires an employer like Tesla to provide 60 days notice if it intends to layoff more than 50 employees, said Duarteâs attorney, Nick Rosenthal. âWe understand that Teslaâs, presumably, going to say, âNo, this isnât a layoff, it wasnât due to a lack of work, it was because they were bad employees,ââ Rosenthal told Jalopnik.
Rosenthal said he believed Tesla was using the excuse of performance reviews as a way to âcover up the fact this was a layoff.â
âWe know that, in the case of our client, that certainly wasnât true,â he said. âHe was an excellent employee. Thatâs why we believe theyâre just using this excuse, âOh, these employees are underperforming.â
Tesla said itâs confident the WARN Act doesnât apply to the current situation and asserted these were firings, not layoffs, that happened over performance.
âLike all companies, Tesla conducts an annual performance review during which a manager and employee discuss the results that were achieved, as well as how those results were achieved, during the performance period,â a Tesla spokesperson said in a statement.
âThis includes both constructive feedback and recognition of top performers with additional compensation and equity awards, as well as promotions in many cases. As with any company, especially one of over 33,000 employees, performance reviews also occasionally result in employee departures. Tesla is continuing to grow and hire new employees around the world.â
Still, the terminations come at a crucial moment for the automaker, which is trying to climb out of its so-called âproduction hellâ for the all-electric Model 3. Tesla missed its production target for the new sedan, forcing CEO Elon Musk to delay the reveal of the companyâs new semi-truck.
Reports have suggested anywhere from 400 to 1,200 employees lost their jobs, but Tesla hasnât confirmed a number to date. Anderson estimated about 500 employees have been laid off, before declining to elaborate.
Additional dismissals was reported on Tuesday by CNBC, which said the latest round occurred at Teslaâs SolarCity subsidiary, again for âperformance reasons.â CNBC reports those employees dispute that account, as well, saying no reviews have been conducted since Solar City was fully acquired by Tesla in late 2016.
Tesla has also been dogged in recent weeks by a spate of lawsuits filed by former employees who claim they suffered racial discrimination and faced anti-LGBT threats. The automaker has disputed the charges, telling The Guardian last week: âThere is no company on earth with a better track record than Tesla.â
The company also took aim at plaintiffsâ lawyers, claiming they file suit against Tesla knowing âit maximizes the changes of generating publicity for their case.â
âThey abuse our name, because they know it is catnip for journalists,â Tesla told The Guardian. âTesla takes any and every form of discrimination or harassment extremely serious.â
Employees this year have levied complaints about pay, safety, and workers rights violations, spurring a unionization effort at Teslaâs Fremont, California, factory that remains ongoing. Musk has said he opposes the United Auto Workersâ effort to organize the plant.
Teslaâs also facing a complaint from the National Labor Relations Board, an independent government agency that seeks to enforce U.S. labor laws. The complaint says the NLRB found merit in employee claims that Tesla is interfering with union activities at the Fremont plant and has violated workersâ rights by requiring them to sign a broad confidentiality agreement. Tesla has said the allegations are baseless. A hearing in that case is scheduled for November 14.
Duarteâs suit requests class-action status, and Rosenthal said if the complaint is certified, heâll be asking for two months of pay for every affected employees, as well as attorneyâs fees.
Update: This story has been updated to clarify the claims of whether these were firings or layoffs, and to correct a quote from Duarteâs attorney.
