Tesla Settles Racial Discrimination Lawsuit With Black Worker

On the heels of a California judge ruling that workers in California can sue Tesla over their concerns of racism at its factories, Tesla has settled a racial discrimination lawsuit with Owen Diaz, a Black man who worked as an elevator operator at Tesla’s Fremont, California, plant in 2015.

As CNBC reports, Diaz had previously been awarded $3.2 million by a federal jury. Diaz’s attorney, Lawrence Organ, from the California Civil Rights Law Group, who represented Diaz in his lawsuit, told the outlet via an emailed statement, “The parties have reached an amicable resolution of their disputes. The terms of the settlement are confidential and we will not have additional comment.”

According to CNBC, Organ spoke with them on March 15 and told the outlet, “It took immense courage for Owen Diaz to stand up to a company the size of Tesla. Civil rights laws only work if people are willing to take those kinds of risks. Even though the litigation chapter of his life is over, there’s still a lot of work to do for Tesla.”

Organ continued, “When I started this case, I suggested that the conduct would stop if Elon Musk would make a statement and a commitment to his employees that this is not tolerated. We haven’t heard that after seven years of litigation, a nine-figure verdict then a seven-figure verdict. Why isn’t he stopping this conduct? That’s what doesn’t make sense to me. Tesla is supposed to be the factory of the future. But this conduct is from the Jim Crow past.”

In addition to Diaz, as Reuters reports, 6,000 Tesla workers who also worked at the same plant as Diaz are accusing the company of tolerating racial bias. There are also cases pending from both California and U.S. anti-bias agencies as well as lawsuits involving individual employees. Tesla is denying the allegations in all of those cases. 

The automaker is also facing a lawsuit from the Equal Employment Opportunity Commission (EEOC) which alleges that Tesla violated “federal law by tolerating widespread and ongoing racial harassment of its Black employees and by subjecting some of these workers to retaliation for opposing the harassment.”

Tesla has countered by effectively calling the EEOC’s allegations “fake-news,” claiming that the allegations run counter to its track record. According to Tesla, the lawsuit from the EEOC perpetuates “a false narrative that ignores Tesla’s track record of equal employment opportunity.”

CNBC noted in their reporting that Tesla does not have a traditional public relations office in North America, which is compounded by the actions of its most public facing representative, CEO Elon Musk. Musk has been critical of DEI, frequently shares rampant misinformation on Twitter/X, which he also owns, and also shares racist pseudoscience concerning racial minorities’ intelligence and physiology on that platform. 

According to Mother Jones, Tesla is not the only company Musk is affiliated with that faces legal complaints based on his social media behavior. Space X, the space flight company he owns, is facing allegations that eight of its employees were fired after they criticized Musk’s posts on Twitter/X.  In January 2024, the National Labor Relations Board filed a complaint after Space X employees fired nine employees who published an open letter in June 2022 on the company’s internal chat system and Space X fired eight of them. The NLRB, during the course of its investigation, has uncovered at least 37 labor violations. 

The letter reads in part, “Elon’s behavior in the public sphere is a frequent source of distraction and embarrassment for us, particularly in recent weeks,” the letter said. “As our CEO and most prominent spokesperson, Elon is seen as the face of SpaceX — every Tweet that Elon sends is a de facto public statement by the company. It is critical to make clear to our teams and to our potential talent pool that his messaging does not reflect our work, our mission, or our values.”

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