NEW YORK (BLOOMBERG) – Tesla lost a trial with a black former elevator operator and must pay him US$137 million (S$185.9 million) for having turned a blind eye to racial taunts and offensive graffiti he endured at the electric car maker’s northern California plant, according to the man’s lawyer.
Mr Owen Diaz, a former contract worker hired at the company in 2015 through a staffing agency, was subjected to a racially hostile work environment, a jury in San Francisco decided on Monday (Oct 4), according to Mr Lawrence Organ, a lawyer for Mr Diaz. The verdict could not immediately be confirmed in electronic court records.
Mr Diaz’s case marked a rare instance in which Tesla, which typically uses mandatory arbitration to resolve employee disputes, had to defend itself in a courtroom trial in public. The company almost never loses workplace arbitrations, though it was hit with a US$1 million award in May in a case brought by another former worker that was similar to Mr Diaz’s.
The trial’s outcome could embolden shareholder activists who have pushed Tesla’s board, so far without success, to adopt more transparency about its use of arbitration to resolve complaints about sexual harassment and racial discrimination. The board is urging investors to vote down such a proposal at a shareholder meeting for Thursday (Oct 7) even as other big Silicon Valley companies, from Alphabet to Uber Technologies, have backed off the use of mandatory arbitration.
Tesla did not immediately respond to a request for comment.