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Tesla Racial Abuse: Court Orders Tesla to Pay Former Employee $137m

Tesla
A San Francisco court has ruled that Tesla must pay $137 million in damages over racial abuse. Credit: Peter McDermott, CC BY-SA 2.0

A jury in San Francisco ordered Tesla to pay Owen Diaz nearly $137 million in damages for racial abuse. Diaz was awarded $6.9 million in damages for emotional distress and $130 million in punitive damages on Monday.

Diaz was a contracted elevator operator who worked at the company’s factory in Fremont, California, from 2015 to 2016. Diaz, who is black, alleged that he was berated with “daily racial epithets” which included the “N-word.”

Diaz also said that swastikas and other racist graffiti were drawn in the plant to further intimidate him. A jury in San Francisco agreed with Diaz on Monday.

“It took four long years to get to this point,” Diaz said to The New York Times. “It’s like a big weight has been pulled off my shoulders.”

Diaz’s attorney Lawrence A Organ, of the California Civil Rights Law Group, said that: “It’s a great thing when one of the richest corporations in America has to have a reckoning of the abhorrent conditions at its factory for Black people.”

Diaz’s lawsuit claimed that his supervisors did not stop the racial abuse despite his reports.

Tesla ordered to pay upwards of $137 million by a federal court in racial abuse case

“Tesla’s progressive image was a façade papering over its regressive, demeaning treatment of African-American employees,” the lawsuit stated.

Tesla did not say whether it would be appealing the decision, but it did issue this statement on Monday:

“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,” wrote Valerie Capers Workman, Tesla’s human resources vice-president.

“But we have come a long way from five 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.”

Workman also attempted to defend the company by suggesting that Diaz’s allegations lacked context:

“In addition to Mr. Diaz, three other witnesses (all non-Tesla contract employees) testified at trial that they regularly heard racial slurs (including the N-word) on the Fremont factory floor,” she wrote. “While they all agreed that the use of the N-word was not appropriate in the workplace, they also agreed that most of the time they thought the language was used in a ‘friendly’ manner and usually by African-American colleagues.”

Tesla typically requires its employees to resolve their workplace disputes through mandatory arbitration, a private proceeding with a third party for settling such issues. But because Diaz was contracted through a staffing agency and not directly with Tesla, he did not have an arbitration agreement clause.

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