California accuses Tesla of racial discrimination in lawsuit

SACRAMENTO, Calif. — California sued Tesla Inc. on Wednesday over allegations of discrimination and harassment of Black employees at its San Francisco Bay area factory.

The suit, filed in Alameda County Superior Court, was sparked by hundreds of worker complaints, said Kevin Kish, head of the state’s Department of Fair Employment and Housing.

The department, which enforces state civil rights laws, “found evidence that Tesla’s Fremont factory is a racially segregated workplace where Black workers are subjected to racial slurs and discriminated against in job assignments, discipline, pay, and promotion creating a hostile work environment,” Kish said in a statement reported by the Wall Street Journal and Bloomberg.

Details of the lawsuit have yet to be released and Tesla didn’t immediately issue a response to the lawsuit, which the electric carmaker had warned was coming several days earlier in an annual filing to the U.S. Securities and Exchange Commission.

However, in a blog post before the filing, Tesla called the suit misguided and said the agency “has never once raised any concern” about its workplace practices following a three-year investigation.

The posting said the lawsuit appears to focus on accusations by production associates at the factory, who said misconduct took place between 2015 and 2019. The post also said it will ask the court to “pause the case and take other steps to ensure that facts and evidence will be heard.”

“Attacking a company like Tesla that has done so much good for California should not be the overriding aim of a state agency with prosecutorial authority,” the blog said.

Last October, a San Francisco jury awarded nearly $137 million to a Black contract worker who said that he faced “daily racist epithets,” including the “N-word,” at the plant in 2015 and 2016 before quitting.

Owen Diaz said employees drew swastikas and left racist graffiti and drawings around the plant and that supervisors failed to stop the abuse.

Tesla is appealing that verdict and has denied any knowledge of racist conduct that Diaz said took place at the plant, which has about 10,000 workers.

Tesla’s blog post said it “has always disciplined and terminated employees who engage in misconduct, including those who use racial slurs or harass others.”

In recent years, Tesla has been hit with numerous allegations by former workers of sexual harassment and racial discrimination at the Fremont plant. However, many don’t reach the courts because Tesla requires its full-time employees to agree to private arbitration of employment-related disputes.