Tesla accused of systemic racial discrimination in California lawsuit

Tesla is being sued over allegations of systemic racial discrimination at the company’s California facilities, a state regulatory agency announced late Wednesday. Tesla said ahead of the lawsuit that such action was "misguided."

Driving the news: California Department of Fair Employment and Housing (DFEH) director Kevin Kish said in an emailed statement that the agency filed the lawsuit Wednesday in the Alameda County Superior Court following an investigation launched after "receiving hundreds of complaints from workers."

• Kish said the agency 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."

Details: Allegations include that Black workers were subjected to verbal racial abuse and that Tesla's "leads, supervisors, and managers were active participants and/or witnesses to these racist comments," per excerpts of the lawsuit provided to Axios.

• Black workers were allegedly "confronted with racist writing" at Tesla on "a daily basis," including graffiti featuring "swastikas, the Confederate flag, a white supremacist skull," and "KKK" on "restroom walls, restroom stalls, lockers, workplace benches, workstations, lunch tables, and the break room," according to the lawsuit.
• "These slurs were even etched onto Defendants’ machinery," the lawsuit alleges. "One Black worker observed 'hang N[ ]' penned next to a drawing of a noose in the breakroom restroom," the suit alleges.

"A common narrative was Black and/or African American workers being taunted by racial slurs and then baited into verbal and physical confrontations, where they, in turn, were the ones disciplined for being purportedly 'aggressive' or 'threatening.'"

The big picture: Tesla disclosed Monday in an annual filing that the DFEH had informed the company it had grounds for a civil complaint over race discrimination and harassment allegations.

• A federal jury in California last year ordered Tesla to pay $137 million in damages to a Black former employee who accused the firm of ignoring complaints that other workers had racially abused him.

What they're saying: Tesla did not immediately respond to Axios' request for comment but said in a blog post ahead of the lawsuit that it "will be asking the court to pause the case and take other steps to ensure that facts and evidence will be heard."

• "Tesla strongly opposes all forms of discrimination and harassment and has a dedicated Employee Relations team that responds to and investigates all complaints," the company said in the post.
• "Tesla continues to seek to provide a workplace that is safe, respectful, fair, and inclusive ­— all of which are vital to achieving our mission," it added.

"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 interests of workers and fundamental fairness must come first."

Editor's note: This article has been updated with new details throughout.