Tesla violated law in mass layoffs, suit says
Former employees allege the electric-car maker failed to give the required 60-day notice for job cuts.
Tesla Inc. was sued by some former employees who say the company’s decision to lay off about 10% of its workforce violated federal law by failing to provide the required notice for the job cuts.
Two workers fired this month from Tesla’s battery factory near Reno allege the company didn’t comply with the 60-day notification requirement under the Worker Adjustment and Retraining Notification Act, according to the federal lawsuit they filed Sunday in Austin, Texas.
John Lynch and Daxton Hartsfield, who worked at the plant for about five years, were among more than 500 employees at the facility who were let go, the suit says. The two men say neither was given any notice of the termination. They are seeking class-action status on behalf of others who were part of mass layoffs in May and June.
The so-called WARN Act requires companies to provide 60-day notice before any mass layoff affecting 50 or more employees at a single site. Lynch said he was notified June 10 that he’d been terminated, effective immediately, and Hartsfield said he was notified June 15.
“Tesla started laying people off in blatant disregard for the WARN Act,” Shannon Liss-Riordan, a Boston employment attorney who is representing the workers, said in an interview Monday.
Tesla didn’t respond to requests for comment.
The electric-car maker, now headquartered in Austin, has grown to about 100,000 employees globally and has hired rapidly in recent months. The cuts, which affected a range of positions, including human resources representatives and software engineers, caught many by surprise.
The plaintiffs are seeking compensation and benefits for 60 days after their termination notice, along with attorneys’ fees and costs.
In early June, Chief Executive Elon Musk said in an email to Tesla executives that he had a “super bad feeling” about the direction of the economy and planned to reduce its salaried workforce by 10% and pause hiring, according to Reuters. In another email, he said Tesla would increase its overall head count this year.
Musk, currently the world’s richest person, has been embroiled in multiple recent conflicts with his employees and those of Twitter, which he has agreed to acquire for $43 billion.
Last week, workers at SpaceX, his private spaceflight company, circulated a letter calling his behavior “a frequent source of distraction and embarrassment for us.” SpaceX quickly fired the employees behind the letter.
Also last week, Musk held a question-and-answer session with Twitter employees, during which he took questions about matters including his stance on remote work — he recently threatened to fire Tesla staffers who failed to appear at the office — and his increasingly vocal support for Republican politicians.