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Tesla and Elon Musk violated labor laws, judge rules

Megan Henney

Tesla and its chief executive, Elon Musk, broke national labor laws several times by preventing union activity, an administrative law judge in California ruled Friday.

The electric-car maker threatened and retaliated against employees who wanted to unionize, a violation of the National Labor Relations Act, last year and in 2017, according to Judge Amita Baman Tracy.

One of the incidents that Tracy said broke the law was a tweet from Musk in May 2018, in which she said he threatened to eliminate stock options for employees if the union was elected.

“Nothing stopping Tesla team at our car plant from voting union,” Musk wrote at the time. “Could do so tmrw if they wanted. But why pay union dues & give up stock options for nothing? Our safety record is 2X better than when plant was UAW & everybody already gets healthcare.”

Tesla did not immediately respond to a request for comment on the Friday ruling, which was issued in response to a complaint filed by the United Auto Workers union. The company, which is widely expected to appeal the decision, has previously denied wrongdoing.

The judge called on Tesla to take several actions to fix the situation, including reinstating employees who lost their jobs because of union activities.

However, according to Bloomberg News, the NLRB is limited in its ability to punish companies for violating labor laws -- meaning that while it can force companies to reinstate and pay back-wages to workers who were fired, it cannot hold executives personally liable.

The ruling is the latest in a string of legal setbacks for the electric-car maker, which has faced intense scrutiny from the Securities and Exchange Commission.

Last October, Musk was removed as chairman of Tesla’s board and forced to pay a $20 million fine after tweeting he had “funding secured” to take the company public. The eccentric billionaire is also limited with what he can share on social media.


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