A California jury has awarded $137 million in damages to a Black former elevator operator who worked in a hostile work environment, including racial harassment and discrimination, at Tesla’s Fremont plant.
According to CNBC and The Washington Post, Owen Diaz worked as a contractor at the plant from June 2015 to May 2016. Diaz testified in court that “daily racist epithets” were used in the plant, including the n-word; that racist graffiti and cartoons appeared in his workspace and the toilets; and that he was told to “go back to Africa” by colleagues. According to Diaz, supervisors failed to routinely act in these concerns, and the stress of the situation caused him to lose weight and have “sleepless nights.” According to Bloomberg News, he told the jury, “Some days I just sit on my stairs and cry.”
For a variety of reasons, the decision is exceptional. First, because of the judge’s award of damages ($130 million in punitive damages and $6.9 million in emotional distress). “I believe that is the largest verdict in an individual race discrimination in an employment case,” said David Oppenheimer, clinical professor of law at Berkeley Law. Second, since the case was held in an open court at all. Tesla, like many Silicon Valley companies, frequently requires employees to submit to mandatory arbitration to handle workplace conflicts, which means they cannot sue the corporation directly.
For years, activist Tesla shareholders have complained about the company’s use of arbitration, claiming that it stifles instances like these. “The use of mandatory arbitration provisions limits employees’ remedies for wrongdoing, precludes employees from suing in court when discrimination and harassment occur, and can keep underlying facts, misconduct, or case outcomes secret, preventing employees from learning about and acting on shared concerns,” one group, Nia Impact Capital, stated in a recent shareholder proposal.
Despite this, Tesla has been accused of racial discrimination and harassment at its Fremont facility. Tesla allegedly paid $1 million to another former employee, Melvin Berry, who claimed a supervisor called him the n-word, and the firm is currently facing a class-action lawsuit alleging racism at the same site.
Tesla’s vice president of people, Valerie Capers Workman, addressed an email to employees in response to the verdict in Diaz’s case this week, which was then published as a blog post. Workman claims that when Diaz complained about harassment, “Tesla stepped in and made sure responsive and timely action was taken,” but admits that a number of incidents occurred and that “[t]he Tesla of 2015 and 2016 (when Mr. Diaz worked in the Fremont factory) is not the same as the Tesla of today.” Workman did not specify whether Tesla intends to appeal the decision.