Tesla: Carmaker told to pay ex-worker $3.2m over racism case

(image credit: Annabelle Liang and Nick Edser)

Electric carmaker Tesla has been ordered to pay almost $3.2m (£2.6m) to a black former worker after he won a racial harassment lawsuit.

A federal jury found that Owen Diaz, a lift operator who worked at Tesla's Fremont factory from 2015 to 2016, was subjected to a racially hostile work environment. The lawsuit alleged that African-American workers were regularly subjected to racist slurs on the factory floor and racist graffiti in bathrooms. The lawsuit also said that employees would refer to areas where black or African-American staff worked with racist historical names, such as "the plantation".

In 2021, a federal court in San Francisco found that Tesla did not take reasonable steps to tackle the abuse, despite complaints to supervisors. The jury awarded Mr Diaz $137m in damages. However, a US federal judge later cut Mr Diaz's award to $15m and said the compensation decided by jurors was "extremely high".

On Monday, Mr Diaz was awarded $3m in punitive damages and $175,000 in damages for emotional distress. Tesla chief executive Elon Musk commented on the case, saying, "If we had been allowed to introduce new evidence, the verdict would've been zero IMO." 

If we had been allowed to introduce new evidence, the verdict would’ve been zero imo.

Jury did the best they could with the information they had. I respect the decision.

— Elon Musk (@elonmusk) April 3, 2023

However, he added, "Jury did the best they could with the information they had. I respect the decision." Tesla's lawyer declined to comment, and the company did not immediately respond to a BBC request for comment.

Bernard Alexander, a lawyer for Mr Diaz, called on jurors to award his client nearly $160m in damages. However, Tesla's lawyer, Mr Spiro, argued that Mr Diaz's lawyers had failed to show that any serious, long-lasting damage had been caused by Tesla. "They're just throwing numbers up on the screen like this is some kind of game show," Mr Spiro said.

Mr Diaz's lawsuit sheds light on the issue of racism in the workplace, particularly towards African-American workers. It also highlights the importance of companies taking steps to address and prevent such behavior. While the amount of damages awarded to Mr Diaz has been significantly reduced, the case serves as a reminder that businesses must be proactive in ensuring a safe and welcoming work environment for all employees.