Tesla: State civil rights agency investigating 'systematic racial discrimination'

One former worker claimed that he received "daily racist epithets" like the n-word and racist graffiti, including swastikas.

 A logo of the electric vehicle maker Tesla is seen near a shopping complex in Beijing, China January 5, 2021. (photo credit: REUTERS/TINGSHU WANG)
A logo of the electric vehicle maker Tesla is seen near a shopping complex in Beijing, China January 5, 2021.
(photo credit: REUTERS/TINGSHU WANG)

Tesla, fighting lawsuits on multiple fronts over alleged racism in its workplaces, has been accused by California’s civil-rights regulator of “systematic racial discrimination and harassment,” the company revealed in a blog post on Wednesday.

California’s Department of Fair Employment and Housing spent three years probing Tesla and intends to sue the company, according to the post, which said the potential lawsuit “appears focused on alleged misconduct by production associates at the Fremont factory that took place between 2015 and 2019.”

The post went on to allege that the electric vehicle maker has been unfairly targeted by state authorities.

“Despite repeated requests, the (Department of Fair Employment and Housing) has declined to provide Tesla with the specific allegations or the factual bases for its lawsuit,” Tesla said. “Tesla strongly opposes all forms of discrimination and harassment and has a dedicated employee relations team that responds to and investigates all complaints. Tesla has always disciplined and terminated employees who engage in misconduct, including those who use racial slurs or harass others in different ways.”

Asked about Tesla’s claims, the state agency said it could not comment on the purported investigation and lawsuit.

 Motorists drive past Tesla's primary vehicle factory after CEO Elon Musk announced he was defying local officials' restrictions against the spread of the coronavirus disease (COVID-19) by reopening the plant in Fremont, California, US May 12, 2020.  (credit: REUTERS/STEPHEN LAM/FILE PHOTO) Motorists drive past Tesla's primary vehicle factory after CEO Elon Musk announced he was defying local officials' restrictions against the spread of the coronavirus disease (COVID-19) by reopening the plant in Fremont, California, US May 12, 2020. (credit: REUTERS/STEPHEN LAM/FILE PHOTO)

San Francisco lawyer David Lowe, who late last year filed seven sexual harassment lawsuits against Tesla by female workers and former workers, said the Department of Fair Employment and Housing has investigative powers that private litigants lack.

“For them to take an interest and get involved indicates to me that they view it as a particularly serious or egregious situation,” Lowe said. He said he has not heard from the department over the sexual harassment cases he filed, and it was unclear whether the department was probing purported sexual harassment at Tesla in addition to claimed racism.

Tesla did not respond to a request for further comment about the suit, and allegations of racism and discrimination at its facilities. News of the state investigation was first revealed by the company Monday in an annual report, though that report stated only that the state civil rights agency had investigated “allegations of race discrimination and harassment at unspecified Tesla locations.”

The news comes as Tesla faces mounting legal troubles over its response to racism and claims of discrimination — allegations that span five years and involve multiple locations and business lines.

In a lawsuit filed last week, Kaylen Barker, a Black lesbian worker at a Tesla parts factory in Lathrop, claimed that a white co-worker called her the n-word and assaulted her. According to the suit, Tesla fired her assailant but then “shockingly” rehired her about two weeks later.

In November, Tesla factory worker Jessica Barraza, a 38-year-old mother of two, claimed in a lawsuit in Alameda County Superior Court that she and other female workers at the Fremont plant were subjected to “a pervasive culture of sexual harassment” which included “a daily barrage of sexist language and behavior” along with “frequent groping on the factory floor.” Her case, and six similar suits launched weeks later, were filed by attorney Lowe.

In October, a San Francisco federal court jury awarded a Black former worker at the Fremont factory almost $137 million — believed to be one of the largest awards in U.S. history for a single plaintiff in a race-discrimination case. Owen Diaz, who worked at the plant in 2015 and 2016 as a contracted elevator operator, claimed in a lawsuit that he faced “daily racist epithets,” including the n-word and that colleagues drew swastikas and left racist graffiti and drawings around the facility. Tesla is seeking a new trial in that case, and said in its annual report it would appeal the award “if necessary.”

In May, an arbitrator ordered Tesla to pay $1 million to Melvin Berry, a Black former Tesla factory worker called racial slurs by supervisors.

Tesla is also still fighting a 2017 lawsuit by former worker Marcus Vaughn, a Black man who claimed the Fremont factory floor was a “hotbed for racist behavior.”

Tesla’s solar operation has also not escaped legal claims of racism. Last month, Shanel Dickson, a Black woman who worked for Tesla Energy, the electric car giant’s solar-power subsidiary, filed a lawsuit in Santa Clara County Superior Court claiming her white supervisor frequently called her the n-word, used another racial slur, and made “inappropriate sexual comments” to her when she was employed as a roofer in Santa Clara County for a year ending in September.

Tesla’s annual report also revealed that the U.S. Securities and Exchange Commission in November subpoenaed it seeking information on its processes for complying with a deal between Tesla and the SEC to resolve a securities fraud charge against CEO Elon Musk after he tweeted in 2018 that he could take Tesla private at $420 per share and that funding for that had been secured. The SEC has accused Tesla and Musk of failing to comply with the mandated company oversight of Musk’s tweeting.