Electric carmaker Tesla has been directed by the court to pay almost $3.2m (£2.6m) to a black ex-employee after he won a racial harassment lawsuit. Owen Diaz, who worked as a lift operator from 2015 to 2016 at its Fremont factory, was found to have been subjected to a racially hostile work environment. However, the amount awarded has been slashed by 98% from the initial $137m he was awarded in 2021, with a judge ruling that the initial amount was excessive. On Monday, Mr Diaz was awarded $3m in punitive damages and $175,000 in damages for emotional distress.
The original lawsuit alleged that African-American workers “encountered a scene straight from the Jim Crow era” at Tesla’s plant in Fremont, California. Mr Diaz claimed that black workers regularly faced racist slurs on the factory floor and racist graffiti in bathrooms. The lawsuit also claimed that employees would refer to areas where black or African-American staff worked with racist historical names, such as “the plantation”. It further alleged that one worker heard racial slurs “as often as 50-100 times a day”.
In 2021, a federal court in San Francisco found that Tesla had not taken reasonable steps to tackle the abuse, despite complaints to supervisors. The jury awarded Mr Diaz $137m in damages. At the time, Tesla disputed the verdict but acknowledged that it was “not perfect”. In April 2022, a US federal judge reduced Mr Diaz’s award to $15m and said the compensation decided by jurors was “extremely high”.
In the recent development, Mr Diaz has been awarded $3.2m in damages for the racism allegations that he faced during his tenure at the Fremont factory. Tesla’s CEO, Elon Musk, took to Twitter and said, “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.” However, he did not provide details of the new evidence that Tesla would have presented. Tesla’s lawyer, Alex Spiro, declined to comment on the case.
According to Mr Diaz’s lawyer, Bernard Alexander, “Mr Diaz’s outlook on the world has been permanently changed. That is what happens when you take away a person’s safety.” He had urged the jurors to award his client nearly $160m in damages. Mr Spiro, however, argued that Mr Diaz’s lawyers had failed to show that any serious, long-lasting damage had been caused by Tesla. He further stated that Mr Diaz’s lawyers were merely throwing numbers up on the screen like it was some kind of game show.
In conclusion, the court has ordered Tesla to pay $3.2m to Mr Diaz in damages for the racism allegations that he faced during his tenure at the Fremont factory. Tesla has been found guilty of not taking reasonable steps to tackle the abuse faced by its African-American workers, despite complaints to supervisors. The case has once again brought to light the issue of racism in the workplace and the need for companies to take concrete steps to tackle the problem.
