Tesla Asks Judge For Pause In California Racism Lawsuit

Electric car maker Tesla asks US judge for a pause in racial discrimination lawsuit brought against it by Californian agency

Tesla has asked a US judge for a pause in a racial discrimination lawsuit brought against it by a Californian agency.

In February this year, the State of California’s civil rights agency, known as the Department of Fair Employment and Housing (DFEH) sued  Tesla for race discrimination and harassment.

The lawsuits alleged that black workers at Tesla “are subjected to racial slurs by managers and supervisors, segregated to the lowest levels of the workforce, including the contracted workforce, and are severely under-represented in the ranks of executives, senior officials, and managers.”

Tesla's pricier Model S. Image credit: Tesla
Tesla’s pricier Model S. Image credit: Tesla

DFEH lawsuit

The civil action DFEH lawsuit alleges Tesla violated the Fair Employment and Housing Act and the California Equal Pay Act.

It said that it had received “hundreds” of complaints and conducted a three year long investigation.

DFEH also alleged that Tesla turned a blind eye to years of complaints from black workers protesting the near-constant use of racial slurs and derogatory language in the workplace.

It said black workers had also protested against the presence of racist writing and graffiti in common areas of the workplace, including swastikas and other hate symbols.

The agency is said to be seeking unspecified damages and for Tesla to reinstate workers who were unfairly terminated.

Tesla meanwhile said the lawsuit was “misguided” and was “a narrative spun by the DFEH and a handful of plaintiff firms to generate publicity.”

It pointed out that during its three year investigation, the DFEH “never once raised any concern about current workplace practices at Tesla.”

Lawsuit pause

Now according to the Guardian newspaper, Tesla has asked a California judge to pause a lawsuit, alleging widespread racial discrimination at its Fremont factory, located in Alameda County in California, near to San Francisco.

In a Monday court filing, Tesla reportedly said the state should further investigate allegations brought against it by the DFEH and allow a chance to settle the litigation.

Tesla’s lawyers said in the Monday filing that the DFEH conducted a “bare bones investigation” before suing and did not share many worker complaints with the company until after the lawsuit was filed.

The EV maker added that the DFEH violated a state law requiring the agency to take various steps before suing an employer.

Tesla is seeking to pause the lawsuit for 120 days and force DFEH into mediation to address the claims with the company outside of court.

Meanwhile the Guardian newspaper also reported that Tesla is facing a separate suit from the US Equal Employment Opportunity Commission (EEOC), and claimed in its filing that the DFEH may have rushed to file its lawsuit in February as part of a “turf war” with the federal agency.

DFEH did not immediately respond to a request for comment.

An EEOC spokesperson said the agency did not comment on pending investigations.

Many lawsuits

Elon Musk and Tesla are facing many lawsuits.

Twitter investors filed a lawsuit against Elon Musk earlier this month, for his late disclosure (against SEC rules) of his 9.1 percent stake in the firm.

The US Securities and Exchange Commission is also investigating Musk and his brother for insider trading.

On Friday, a judge settled another suit against Musk, ruling he had falsely claimed he had funds to take the company private in 2018.

Last November, investment bank JPMorgan Chase sued Musk and Tesla for $162 million, alleging Elon Musk’s privatisation tweet in 2018 cost it millions of dollars.

In January 2020 Owen Diaz hit Tesla with a lawsuit, alleging he had faced “severe and pervasive racial harassment” in 2015 and 2016, whilst working at Tesla’s factory in suburban Fremon

In October last year, a federal jury ordered Tesla to pay $137 million in damages, for subjecting Diaz to a hostile work environment at the Fremont plant.

Last week a federal judge ruled that Tesla was still liable to pay damages, but he reduced the $137 million jury award to $15 million.