Tesla walks back layoff estimates, facing mass layoff lawsuit

Elon Musk has had a bad feeling about the economy all month, to such a degree that he sent an all-staff message a few weeks ago estimating Tesla would soon be laying off about 10 percent of its workforce. Those layoffs have reportedly begun, but Musk has changed his layoff estimates to just three percent, apparently.

Musk said in a recent interview with Bloomberg News Editor-In-Chief John Micklethwait that he believes Tesla’s total workforce will actually be higher a year from now. At the moment, though, hourly employees in sales, service, and delivery have already been laid off, despite Musk’s original promise that only the company’s “salaried headcount” would be affected.

This change of heart may have something to do with the fact that Tesla is currently facing a class-action lawsuit filed by former Nevada Gigafactory workers who say the mass layoff they were part of was actually illegal.

Tesla employs about 100,000 people around the world, so the new layoff plan will still affect somewhere around 3,000 employees.

Sixty days — A couple of weeks ago, John Lynch and Daxton Hartsfield, two Gigafactory workers, were laid off without any notice, amongst some 500 other employees. Federal law requires that employees be given notice 60 days in advance of any mass layoffs, and Tesla gave... zero days’ notice.

The lawsuit, which was filed on Sunday, seeks class-action status for every employee let go as part of the mass layoff. Shannon Liss-Riordan, a lawyer representing the workers, said it’s “pretty shocking that Tesla would just blatantly violate federal labor law.”

Some employees have reportedly been given just one week of severance. The lawsuit seeks to secure pay and benefits for the 60 days employees missed out on.

Musk doesn’t seem bothered — During the same interview with Bloomberg News, Musk essentially laughed off the lawsuit, saying it has “no standing.”

“It seems like anything related to Tesla gets a lot of clicks, whether it is is trivial or significant,” Musk said. “I would put that lawsuit you’re referring to in the trivial category.”

Musk faces legal scrutiny on many other fronts, too. Musk allegedly sexually harassed an employee and paid her to stay silent; his Neuralink venture is being accused of animal cruelty; and, of course, there’s the alleged rampant racism problem at the Fremont Tesla factory.