The National Labor Relations Board has ruled that Tesla Inc. (NASDAQ: TSLA) violated labor laws when it fired a union activist in 2017. The federal agency also ordered CEO Elon Musk to remove an “unlawful tweet” in 2018 that threatened Tesla workers hoping to unionize.
What Happened: The NLRB directed Tesla to rehire the union activist, Richard Ortiz, and compensate him for loss of earnings, other benefits and adverse tax consequences following his firing. Ortiz was part of an organizing campaign, “Fair Future at Tesla.”
The NLRB said Tesla broke the law by “coercively interrogating” workers who attempted to unionize and for preventing them from speaking to the media without explicit written permission from the company.
Tesla has been ordered to revise a confidentially agreement it provides to employees and inform them of their protected rights by posting notices nationwide and holding meetings at its Fremont, California factory.
Further, Musk has been asked to remove his 2018 tweet that “unlawfully threatened” workers. The CEO’s tweet was in response to increased efforts by workers to form a union with the United Auto Workers at the Fremont factory.
“Nothing stopping Tesla team at our car plant from voting union. Could do so tmrw if they wanted. But why pay union dues & give up stock options for nothing? Our safety record is 2X better than when plant was UAW & everybody already gets healthcare,” Musk had said in the tweet.
See Also: Tesla Fremont Factory Recorded 450 COVID-19 Cases After Controversial Reopening In May: Report
Why It Matters: Tesla has said its factories should remain union-free and opposed efforts by workers to unionize. Musk has repeatedly clashed with workers at the Fremont factory for their pro-union stance and over working conditions at the factory.
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Musk being ordered to delete his tweet is also significant, as Tesla counts tweets by its CEO to be official communication from the company.
Price Action: Tesla shares closed 1.6% higher on Thursday at $640.39 and further added 0.4% in the after-hours session.
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