Tesla Violated Labor Laws with Elon Musk’s Tweet, Judge Says

Tesla boss Elon Musk (L) walks with Shanghai Mayor Ying Yong during the ground-breaking ceremony for a Tesla factory in Shanghai on January 7, 2019. (Credit: STR/AFP/Getty Images)

Tesla boss Elon Musk (L) walks with Shanghai Mayor Ying Yong during the ground-breaking ceremony for a Tesla factory in Shanghai on January 7, 2019. (Credit: STR/AFP/Getty Images)

Tesla violated labor laws by threatening employees when they attempted to unionize, a California labor judge ruled late Friday.

The company must now hold a meeting to advise workers of their rights, and CEO Elon Musk is required to attend.

Administrative Law Judge Amita Baman Tracy ruled Friday that Tesla had violated the National Labor Relations Act multiple times in 2017 and 2018.

The violations included a Musk tweet in May 2018 saying, “Nothing stopping Tesla team at our car plant from voting union. Could do so tmrw if they wanted. But why pay union dues & give up stock options for nothing?”

The judge said the tweet amounted to “threatening employees” they would lose their stock options if they voted to unionize.

“Musk’s tweet can only be read by a reasonable employee to indicate that if the employees vote to unionize that they would give up stock options,” Tracy wrote. “Musk threatened to take away a benefit enjoyed by the employees consequently for voting to unionize.”

The ruling also found Tesla violated labor laws by prohibiting employees from distributing leaflets in their off-hours in the employee parking lot in Fremont, California; telling employees it was futile to vote for the union; and interrogating employees about their union activities.

Tracy ruled that Tesla needs to “cease and desist” that behavior and fully reinstate and compensate one employee who had been unlawfully fired for being involved with union activities. The carmaker also needs to inform workers at a meeting that Tesla violated the National Labor Relations Act several times.

The ruling was issued in response to unfair labor practice complaints filed by the United Auto Workers union, including one in 2017 that accused the company of firing union supporters.

The UAW on Saturday did not immediately comment on the ruling. It said Tesla workers have not yet held a vote on unionizing.

Tesla did not immediately comment Saturday. It is not clear if the company will appeal.

In 2017, Tesla said that no employee had ever been punished for supporting a union, in response to a complaint from UAW.

In 2018, Tesla defended Musk’s tweet to CNN Business. “Elon’s tweet was simply a recognition of the fact that unlike Tesla, we’re not aware of a single UAW-represented automaker that provides stock options or restricted stock units to their production employees, and UAW organizers have consistently dismissed the value of Tesla (TSLA) equity as part of our compensation package,” a spokesperson said.

UAW said on Saturday its contracts with General Motors, Ford and Chrysler did have profit-sharing plans.

Elon Musk is in the midst of numerous legal battles charging that he’s watching out more for his own interests than those of Tesla’s shareholders. Tesla spokespeople and attorneys say the suits are without merit and Tesla will vigorously contest them.

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