In a complaint brought by two former Tesla employees, it is alleged that the firm broke the law by neglecting to give 60 days’ notice of a mass layoff.
After Tesla CEO Elon Musk first said that the hourly workers were expected to be unscathed by the layoffs, word broke on Sunday that Tesla intended to fire hourly employees.
John Lynch and Daxton Hartsfield, who were both employed at Tesla’s Gigafactory in Sparks, Nevada, when the layoffs started in early June, filed the case. According to the two former workers, “more than 500” Gigafactory employees were let go.
Lynch and Hartsfield contend that the mass layoff is in violation of the Worker Adjustment and Retraining Notification (WARN) Act, which mandates that companies provide employees at least 60 calendar days’ notice before closing a plant or dismissing 50 or more employees from the same location.
According to the lawsuit, Tesla “has neglected to provide Plaintiffs and the Class Members with any advance written notice of their terminations.” Instead, Tesla merely informed the staff that their terminations would take effect right away. Additionally, Tesla neglected to explain why the notification time was reduced to zero days in advance notice.
The ex-employees are asking for payment and perks for the previous 60 days. In their complaint against people who were fired in May and June without providing the legally required notice, they are also asking for class-action status.
This came after Musk sent an internal email outlining a global recruiting freeze and a strategy to reduce the company’s staff by roughly 10%. Musk said in the email that his “very terrible feeling” about the US economy was the reason for the layoffs.
The hourly employees of Tesla initially seemed to be exempt from the layoffs. Tesla will be decreasing salaried employment by 10% as we have gotten overstaffed in numerous departments, according to an email issued to the whole company on June 3.
A day later, in response to a remark concerning Tesla’s staffing over the upcoming 12 months, Musk tweeted that “overall headcount will increase, but salaried should remain basically flat.” This past weekend, rumors that hourly workers might also be laid off started to circulate.
This may be the second instance in which a business led by Musk has violated US labor rules. A number of SpaceX employees were let go last week for contributing to an open letter condemning Musk’s actions. A federal provision safeguarding employee discussion about working conditions may have been broken by the firings.