$137 Million Jury Award Against Tesla Reduced to $15 Million

Allen Smith, J.D. By Allen Smith, J.D. April 18, 2022

[Editor's note: The plaintiff declined the $15 million award and at a new trial, $3.2 million was awarded.]​

A federal judge reduced a $137 million award against Tesla in a race bias lawsuit to $15 million on April 13 but rejected the electric carmaker's request for a new trial. We've gathered articles on the news from SHRM Online and other media outlets.

Last Year's Verdict

Last year, a federal judge ordered Tesla to pay a Black former elevator operator $137 million in damages on his claim that the electric carmaker ignored racial epithets and graffiti that created a hostile work environment. The plaintiff, who was contracted to work through a staffing agency in 2015 and 2016, claimed that he was forced to quit because he was subjected to "daily racist epithets," including the N-word, as well as swastika drawings and other racist graffiti at a Tesla plant in the San Francisco Bay Area. The plaintiff said supervisors did not curb the behavior. Tesla did not comment on the verdict but has previously denied knowing about alleged racist conduct at the Bay Area plant.

(Associated Press) and (SHRM Online)

Prior Award 'Unconstitutionally Large'

The judge described the prior award of punitive damages of $130 million "unconstitutionally large," reducing the compensatory damages award from $6.9 million to $1.5 million and the punitive damages award to $13.5 million.

(MarketWatch) and (The New York Times)

Liability Finding Upheld

In the April 13 decision, the judge said the evidence amply supported the jury's finding that Tesla was liable for the "profound" emotional harm the employee experienced and the "often inadequate" disciplinary steps the company took. The lawyer for the worker said the employee will appeal the reduced damages award.


Tesla's Message to Employees

In a message to employees last year that was shared on the company blog, a Tesla executive outlined what the jury heard and said the company believes "these facts don't justify the verdict."

"We do recognize that in 2015 and 2016 we were not perfect," then-Vice President of People Valerie Capers Workman wrote. "We're still not perfect." Workman added, "we will continue to remind everyone who enters the Tesla workplace that any discriminatory slurs—no matter the intent or who is using them—will not be tolerated."


Another Lawsuit

The California Department of Fair Employment and Housing (DFEH) sued Tesla separately on Feb. 9, alleging racial discrimination and harassment. "After receiving hundreds of complaints from workers and a nearly three-year investigation, DFEH found evidence that Tesla operates a racially segregated workplace where Black workers are subjected to racial slurs and discriminated against in job assignments, discipline, pay and promotion," said DFEH Director Kevin Kish.

Tesla criticized the lawsuit, arguing that the state agency had investigated dozens of previous claims in recent years and found no misconduct. "It therefore strains credibility for the agency to now allege, after a three-year investigation, that systematic racial discrimination and harassment somehow existed at Tesla," the company said.

(SHRM Online) and (The New York Times)



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