Elon Musk Faces Another Lawsuit Following Tesla Mass Layoffs

Fridah Wangechi | 1 year ago
Tesla CEO Elon Musk .PHOTO | AFP

Just days after the world richest person Elon Musk and his electric motor vehicle company Tesla Inc were sued for running a pyramid scheme, he is now facing another suit after the company conducted a mass layoff without informing  employees.

Two former Tesla employees have filed a lawsuit against the U.S based electric car company accusing it of mass firing in violation of the federal law that stipulated that companies issue advance notices to its workforce in the event of a lay off.

The lawsuit was filed on Sunday, June 19 by the two employees out of 500 others who were sacked from the Tesla factory plant in Nevada.

They claimed that the company was in contravention of federal laws on mass lay offs that requires a 60-day notification period under the Worker Adjustment and Retraining Notification Act.

The complainants, John Lynch and Daxton Hartsfield, who were fired on June 10 and June 15 respectively are now seeking action be taken against the company for all Tesla employees who.lost their jobs in May or June without prior notice.

"Tesla has simply notified the employees that their terminations would be effective immediately," the complaint in the suit read.

Tesla had distanced itself from the claims, and had opted not to comment on the number of layoffs or about the lawsuit.

CEO Elon Musk had earlier in the month stated that he had a "super bad feeling" about the economy and that in order to sustain the company, Tesla needed to slash the number of staff by 10 percent.

The axed workers are now seeking pay and benefits for the 60-day notification period.

"It's pretty shocking that Tesla would just blatantly violate federal labor law by laying off so many workers without providing the required notice," Shannon Liss-Riordan, an attorney representing the workers told international publication Reuters.

Shannon revealed that she was privy to information that Tesla is offering some employees only one week of severance for their silence, and that she was preparing an emergency motion with a court to try to bar Tesla from trying to get releases from employees in exchange for just one week of severance.

When asked about the lawsuit, Musk downplayed the allegations, terming it as trivial and was just for the clicks.

"Let's not read too much into a pre-emptive lawsuit that has no standing," he said at the Qatar Economic Forum organised by Bloomberg.

"It seems like anything related to Tesla gets a lot of clicks, whether it is trivial or significant. I would put that lawsuit you're referring to in the trivial category." he added.

Musk was on Thursday, June 16, sued for Kshs 30 trillion($258bn) by a Dogecoin investor who accused him of running a pyramid scheme to support the cryptocurrency.

In a complaint filed in federal court in Manhattan, plaintiff Keith Johnson accused Musk, Tesla Inc and space tourism company SpaceX of racketeering for touting Dogecoin and driving up its price, only to then let the price tumble.

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