In a landmark decision, a federal appeals court has ruled that Tesla CEO Elon Musk violated federal labor law by tweeting that his employees would lose their stock options if they joined a union. The court affirmed a previous order by the National Labor Relations Board (NLRB) that found Musk had unlawfully interfered with workers’ rights to organize and bargain collectively.
The case stems from a 2018 tweet by Musk, in which he responded to a question about unionization at Tesla’s Fremont, California plant. Musk wrote: “Nothing stopping Tesla team at our car plant from voting union. 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.”
The NLRB ruled that this tweet constituted an implied threat to retaliate against workers who chose to unionize, as stock options are part of their compensation and benefits. The NLRB also found that Tesla had illegally fired Richard Ortiz, a pro-union employee who had shared information about other workers who testified against a pro-union bill in the state legislature.
The 5th Circuit US Court of Appeals upheld the NLRB’s findings and ordered Tesla to reinstate Ortiz with backpay and benefits, and to delete Musk’s tweet. The court also ordered Tesla to post notices at its facilities informing workers of their rights under federal labor law and stating that the company will not interfere with those rights. This ruling is a significant victory for the United Auto Workers (UAW), which has been trying to organize Tesla workers for years.
The UAW praised the court’s decision and called on Tesla to respect its workers’ rights and dignity. “While we celebrate the justice in today’s ruling, it also highlights our broken US labor law,” said UAW President Shawn Fain. “Here is a company that clearly broke the law and yet it is several years down the road before these workers have achieved a modicum of justice.”
Musk has not commented on the ruling yet, but he has previously expressed his opposition to unions and claimed that they are not needed at Tesla. He has also touted Tesla’s safety record and employee satisfaction as reasons why workers do not need union representation. However, some Tesla workers have reported long hours, low wages, high turnover, and unsafe working conditions at the company’s factories.
The court’s ruling could have implications for other tech companies that have faced similar challenges from workers who want to unionize or improve their working conditions. It could also encourage more workers to exercise their rights and join unions in an industry that has historically been resistant to labor organizing.
