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Elon Musk clarifies Tesla layoffs after ex-employees sue company


Tesla CEO Elon Musk.

Patrick Pleul | AFP | beautiful pictures

Elon Musk sought to clarify how many Tesla workers will lose their jobs, following a lawsuit by former employees alleging that the automaker violated US labor laws.

Speaking at an event hosted by Bloomberg on Tuesday, Musk said Tesla will reduce its salaried workforce by 10% over the next three months, while increasing the number of hourly employees.

One report Earlier this month, from Reuters, Musk said he wanted to cut 10% of jobs, citing an internal email written by the Tesla CEO. In the memo, Musk said he had “extremely bad feelings” about the economy.

But in a follow-up email to Tesla employees obtained by CNBC, Musk clarified that the company will reduce its salaried staff by 10% and increase hourly staff.

Musk said on Tuesday that this means Tesla’s layoff announcement will affect about 3.5% of its overall workforce, adding that the actual amount “isn’t supermaterial.” “. Salaried employees make up about two-thirds of Tesla employees, he added.

“One year from now, I think our head count will be higher both in terms of wages and obviously hourly,” Musk said.

On Sunday, two former Tesla employees file a lawsuit against the company accused it of violating US federal law regarding “mass layoffs.”

Under the Worker Adjustment and Retraining Notification Act, employers are required to give 60 days’ notice of mass layoffs or factory closures.

Musk, the world’s richest man, dismissed the importance of the suit on Tuesday, saying it “has no place”.

“It’s a small lawsuit with minor consequences,” he said. “Anything related to Tesla gets big headlines, whether it’s a bicycle accident or something much more serious.”

Musk’s treatment of workers has come under close scrutiny recently. He recently told Tesla employees that they should come to the office at least 40 hours a week or leave the company.

While other tech bosses – including Parag Agrawal, CEO of Twitter, which Musk is trying to buy – has accepted the post-Covid push into telecommuting, Musk is not participating. He has said that people who want to work remotely “should pretend to work somewhere else.”

The company has also faced accusations of racial discrimination against black workers. In February, California’s Department of Fair Employment and Housing sued Tesla over historic complaints of racial discrimination and harassment.

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