Tesla Scrutinized For Recent Mass Layoffs

Recently – and not for the first time – Tesla has fired a large number of workers. In both its automotive branch and solar panel subsidiary, hundreds of Tesla employees were let go in what has been described as a “pink slip rampage.” Now, former employees are taking the company to task for its claims of unsatisfactory performance, which Tesla claimed was the basis for firing twelve hundred employees worldwide.California unemployment lawyers

What is Really Going on at Tesla?

According to Slate, there is a conflict between the company’s claims of unsatisfactory performance and employees’ claims that they were not privy to any performance reviews. Employees are claiming that the firings were actually mass layoffs, and that the company violated their rights under the WARN Act (California Labor Code Division 2, Part 4, Sections 1400-1408). Under the WARN Act, employers must give sixty days’ written notice of mass layoffs. The notice must be provided to both affected employees and local employment authorities. Tesla, in turn, claims that the positions will be backfilled, and the firings cannot, therefore, be layoffs. (Interestingly, Tesla did provide WARN notices to over two hundred employees at its Roseville, California worksite.) Tesla is facing other circumstances that call into question the timing of the terminations. It is currently experiencing significant delays in the release of its Model 3. Tesla is also in the midst of a merger with its solar panel subsidiary, Solar City, which investors approved in November 2016. Both of these conditions are likely to leave Tesla lacking in liquid assets for a time. Lawsuits have already been filed by terminated employees. It is now up to the California courts to determine the nature of the Tesla layoffs.

When Does California Law Allow Employment to be Terminated?

Apart from mass layoffs and the provisions of the WARN Act, California law does allow employers to lawfully terminate employment in specific circumstances, which are codified in Sections 2920 – 2929 of the California Labor Code. Employment without a specified term may be terminated by either party at will (with notice to the other party). Employers can also terminate employment for a specified term if the employee makes a willful breach of his or her duties, habitually neglects employment duties, or has a continued incapacity to perform job duties.

While these provisions protect an employee’s right to not be terminated arbitrarily, there are also open to interpretation. This is the problem faced by the former Tesla workers. If Tesla now claims there was a willful breach or habitual neglect of employment duties, the employees may find it difficult to disprove these claims. On the other hand, Tesla may find it difficult to advance its theory, if there is not documentation of unsatisfactory performance reviews, or other evidence that all twelve hundred fired employees were simultaneously in breach of their employment duties.

If you or a loved one has been fired by an employer, you have the right to legal protections for termination of the employment relationship. A wrongful termination attorney can protect California workers’ rights to be terminated on proper legal grounds, and receive the full amount of compensation to which they are entitled.

Contact the employment attorneys at Nassiri Law Group, practicing in Orange County, Riverside and Los Angeles. Call 949.375.4734.

Additional Resources:

What’s Going on With All These Tesla Firings?, October 26, 2017 by Aaron Mak, Slate

More Blog Entries:

Report: More Airline Employees Face Possible Discipline for Passenger Interactions, May 2, 2017 by Employment Lawyer Blog


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