According to reports, Tesla was today filed a class-action lawsuit by two former employees, alleging that the company’s recent large-scale layoffs violated the law and illegally laid off employees without prior notice.
The two former employees, John Lynch and Daxton Hartsfield of Tesla’s Gigafactory in Nevada were fired on June 10 and June 15, respectively.
They allege in the indictment that Tesla violated the Worker Adjustment and Retraining Notification Act (WARN). The bill requires businesses to give affected workers 60 days’ notice before laying off workers. During this period, the business also pays the wages.
Earlier this month, Tesla CEO Elon Musk said he had a “super bad feeling” about the economy and that Tesla needed to cut 1/10 of its workforce or about 10,000 people.
The two former employees said Tesla did not give them and other employees advance written notice of the layoffs. Instead, Tesla just notified employees that their dismissals would take effect immediately. Moreover, Tesla did not inform employees that the advance notice period was shortened to “zero days.”
The lawsuit requires Tesla to pay 60 days of wages and benefits, attorney’s fees, and any other and further subsidies to which the plaintiffs are entitled.
Tesla shares fell 9% after Musk made public the layoffs earlier this month. The shares of Tesla have fallen more than 45% year-to-date.
It was reported last week that Tesla has set off a new wave of layoffs starting on Thursday, local time. To make matters worse, in addition to “fixed wage workers”, “hourly workers” were also affected. By the end of 2021, Tesla has nearly 100,000 employees worldwide.
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