Dive Brief:

• Tesla CEO Elon Musk violated Section 8(a)(1) of the National Labor Relations Act (NLRA) last year when he sent a tweet suggesting that Tesla employees who voted to unionize would lose their company stock options, an administrative law judge for the National Labor Relations Board (NLRB) ruled Friday.
• Though Musk said in the tweet that there was "[n]othing stopping" workers at the company's car production plant in Fremont, California, from voting for a union, Musk questioned why they would do so: "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." The judge found the statement to be "a threat of unilateral discontinuation of existing benefits if the employees unionized," rather than a statement of what could occur as a result of good-faith bargaining.
• Additionally, the judge determined that Tesla committed several other violations of the NLRA between 2017 and 2018, including enforcing a rule that prohibited off-duty employees from distributing union literature in an employee parking lot, interrogating employees about their union activity and prohibiting employees from wearing union insignia. But the judge also ruled in Tesla's favor on some complaints, including one alleging that a Tesla HR official prevented employees from taking photos of a confidentiality agreement. Tesla did not immediately respond to HR Dive's request for comment.

Dive Insight:

The decision follows a series of labor controversies involving Tesla production facilities in the past few years. In 2017, a Tesla employee complained in a public letter that the company poorly treated workers, and said that a group of its workers had begun talks with the International Union, United Automobile, Aerospace and Agricultural Implement Workers of America (UAW). Musk shot back, calling the employee's complaints "outright false" and defending policies including the company's compensation rates.

Later that year, the NLRB ordered Tesla to respond to workers' complaints of unfair labor practices and allegations that it interfered with union-related activity. The series of events continued as UAW filed a complaint in October 2017 alleging that Tesla violated the NLRA by firing employees for supporting unionization. The judge ruled Friday that Tesla had indeed committed a violation of the NLRA when it terminated one employee, Richard Ortiz, and disciplined another, Jose Moran, that year.

The company also faced two separate investigations launched in 2018 by California's Division of Occupational Safety and Health. A Business Insider report in January 2019 revealed the state regulatory agency fined Tesla nearly $30,000 after it found safety hazards in a structure located outside the company's main vehicle factory.

Section 8(a)(1) of the NLRA bars employers from interfering with, constraining or coercing employees in the exercise of rights guaranteed by Section 7 of the Act. Per the NLRB, employers may not threaten employees with adverse consequences, including a loss of benefits, if they support a union, engage in union activity or select a union to represent them.

As part of the remedy ordered by the judge, Tesla must rescind disciplinary action against Moran and must reinstate Ortiz. The judge also ordered Tesla to convene its employees and have Musk read a notice to workers at the Fremont facility that will serve to reassure them that their employer and its managers are bound by the NLRA's requirements. "The Board has recognized that notice reading is an extraordinary remedy but, in this instance, I believe the facts present themselves to support such a request," the judge wrote.