US court orders Tesla to pay $137m in racism at work suit

A jury in San Francisco has told Elon Musk’s Tesla to pay $137 million in damages to a Black former employee who sued them for creating a hostile work environment where he experienced racist abuse from colleagues and supervisors.

The employee – Owen Diaz – worked at Tesla’s Fremont, California, plant between 2015 and 2016. He claims that he was repeatedly referred to by racial slurs and that racist epithets were left in the plant’s bathroom.

Diaz told the jury that supervisors failed to intervene, and he repeatedly complained about his treatment, but nothing was done by Tesla to resolve the situation. According to the New York Times, Diaz noted after the trial: “It’s not like they were removing the offensive behavior, they would just let people keep adding and adding.”

The money involves $130 million in punitive damages, while the remaining $7 million is for emotional distress of Diaz’s treatment at Tesla. The stress of working in this hostile environment caused him to lose weight and have sleepless nights.

This comes after Tesla reportedly paid $1 million in damages to another former employee, Melvin Berry, for racist abuse. The car manufacturer is also facing a class-action lawsuit that alleges it has a racist and unsafe workplace, according to the Verge.

In an email to employees, which was also shared a blogpost, Tesla’s vice-president of people Valerie Capers Workman wrote:

“Earlier today, a jury in San Francisco decided that in late 2015 and early 2016 Tesla failed to make sure that one contract employee (Owen Diaz) was not racially harassed while he worked at the Tesla Fremont factory.

“I heard the testimony of every witness. I was at the defense table for Tesla every day during the trial because I wanted to hear firsthand what Mr. Diaz said happened to him.”

Workman continued to state that “Mr. Diaz never worked for Tesla. He was a contract employee who worked for Citistaff and nextSource”.

She added: “Mr. Diaz made written complaints to his non-Tesla supervisors. Those were well-documented in the nine months he worked at our factory. But he didn’t make any complaints about the n-word until after he was not hired full-time by Tesla – and after he hired an attorney.”

Workman disputed Diaz’s claims that Tesla did nothing following his complaints.

She noted: “The three times that Mr. Diaz did complain about harassment, Tesla stepped in and made sure responsive and timely action was taken by the staffing agencies: two contractors were fired and one was suspended (who had drawn a racially offensive cartoon). Mr. Diaz himself testified that he was “very satisfied” with the results of one of the investigations, and he agreed that there was follow-up on each of his complaints.”

She concluded: “While we strongly believe that these facts don’t justify the verdict reached by the jury in San Francisco, we do recognize that in 2015 and 2016 we were not perfect.

“We’re still not perfect. But we have come a long way from 5 years ago. We continue to grow and improve in how we address employee concerns.

“Occasionally, we’ll get it wrong, and when that happens we should be held accountable.”

It remains unclear if Tesla will appeal the case.