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Tesla sued by former employees over 'mass layoff'

Published 06/20/2022, 07:29 PM
Updated 06/21/2022, 03:01 PM
© Reuters. FILE PHOTO: A Tesla logo is seen in Los Angeles, California U.S. January 12, 2018. REUTERS/Lucy Nicholson/File Photo

© Reuters. FILE PHOTO: A Tesla logo is seen in Los Angeles, California U.S. January 12, 2018. REUTERS/Lucy Nicholson/File Photo

By Akriti Sharma and Hyunjoo Jin

(Reuters) -Former Tesla (NASDAQ:TSLA) Inc employees have filed a lawsuit against the U.S. electric car company alleging its decision to carry out a "mass layoff" violated federal law as the company did not provide advance notice of the job cuts.

The lawsuit was filed late on Sunday in Texas by two workers who said they were terminated from Tesla's gigafactory plant in Sparks, Nevada, in June.

According to the suit, more than 500 employees were terminated at the Nevada factory.

The workers allege the company failed to adhere to federal laws on mass layoffs that require a 60-day notification period under the Worker Adjustment and Retraining Notification Act, according to the lawsuit.

They are seeking class action status for all former Tesla employees throughout the United States who were laid off in May or June without advance notice.

"Tesla has simply notified the employees that their terminations would be effective immediately," the complaint said.

Tesla CEO Elon Musk, the world's richest person, said earlier this month he had a "super bad feeling" about the economy and that Tesla needed to cut staff by about 10%, according to an email seen by Reuters.

More than 20 people identifying themselves as Tesla employees said they were laid off, let go or had positions terminated this month, according to online postings and interviews with Reuters.

The action filed by John Lynch and Daxton Hartsfield, who were fired on June 10 and June 15 respectively, seeks pay and benefits for the 60-day notification period.

Tesla, which has not commented on numbers of layoffs, did not respond to requests for comment about the lawsuit.

Musk, however, on Tuesday called the lawsuit "trivial."

"Let's not read too much into a pre-emptive lawsuit that has no standing," he said at the Qatar Economic Forum organised by Bloomberg.

"It seems like anything related to Tesla gets a lot of clicks, whether it is trivial or significant. I would put that lawsuit you're referring to in the trivial category."

Shannon Liss-Riordan, an attorney representing the workers, told Reuters she finds it very concerning that the richest man in the world considers it "trivial" that his company is blatantly violating federal labor law to protect workers.

"While two months' pay certainly doesn't matter to him, it matters a lot to the employees who made his company what it is," she added.

© Reuters. FILE PHOTO: A Tesla logo is seen in Los Angeles, California U.S. January 12, 2018. REUTERS/Lucy Nicholson/File Photo

She said Tesla is offering some employees only one week of severance, adding that she is preparing an emergency motion with a court to try to block Tesla from trying to get releases from employees in exchange for just one week of severance.

The lawsuit was filed in the U.S. District Court, Western District of Texas.

Latest comments

meanwhile they build new factories in europe and china. lol
Now I see why they were fired
Now I see why they were fired
If your rich enough rules dont mean squat. No one said life was fair. I got used to being stepped on at a early age and now im 64. *******it up buttercup
What a poor way to live. Billionaires are stepping on my face, eh, I will just let them instead of doing something about it. That is why boomers are worst generation
Why do so many wealthy people become sociopaths? Trivial is not the word I would use to describe someone's livelihood.
yeah, and it shouldn't be that much to expect the company to at least give the required layoff period to the employees who've done nothing wrong.....
500 is a mass layoff for a plant that employees over 7000 people? I don't think so.
The WARN act defines a mass Layoff as 500 or more employees or 33% of the workforce if under 500 within a 30 day period. There are exceptions for employees working less than six months or part time employees.
first of all it says more than 500 employees, secondly why is it so hard for a company like Tesla to treat its employees decently?  no one is saying it shouldn't layoff the workers, but is it so hard to act like decent organization and give these employees who are about to lose their jobs though no fault of their own the required notification period???
white collar is gonna see lots of layoffs. some'll be doing fast food customer service for a living or maybe TJ Max.
Good for Elon. This man is my hero.
you hero's own daughter wants to change her name because she wants to have nothing to do with him at all, just another indication of what kind of human being he is
How much would you pay to lick his boots?
wait - isnt that why Musk went to Texas because he could shout Yee ha and ride shot_gun through the employment scene
#BootayHurt ex-employees.
That's called competition, not a super bad feeling about the economy.
Hopefully this hurts the ev industry.. not that i have puts.. er rmm
Hahahaha.... GOOD!!
TSLA is a private company, they can fire whomever they please..
Tesla is a public company, which means its shares are publicly traded on an open market. But it's not a state or federal company if that's what you mean. There are rules to do it. Employees give most of their time to the company, the least it can do is to warn them.
There are rules to donit f ing idi...
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