Tesla Sued by Warehouse Employees Over Work Quotas and Overtime

Tesla Inc. allegedly stiffed warehouse workers on pay, made them perform off-the-clock work, and imposed quotas so high the employees could fall short if they took time to use the bathroom, a federal suit says.

The Elon Musk-led company didn’t warn workers that they could be fired if they fell short of hitting numbers that sometimes “had never been disclosed to them,” according to a complaint filed Thursday in the US District Court for the Eastern District of California.

“This quota, because it denies proper access to rest breaks and bathroom time, causes employees to have to work at speeds beyond those which are safe and without proper periods of rest, causing unnecessary injuries,” according to lead plaintiffs Shannon Brown and Tami Okada. The automaker also forced them to “work in the heat without air conditioning,” their proposed class action said.

Tesla is cutting prices on its best-selling Model Y sport utility vehicle as the automaker’s sales slump and production outpaces demand. The company made 46,561 more vehicles than it delivered during the first quarter of this year.

Tesla didn’t immediately respond to a Friday request for comment. Musk isn’t named as a defendant in the wage-and-hour suit.

This isn’t the company’s first brush with employment litigation. Tesla also lost its bid to end an Equal Employment Opportunity Commission racial discrimination suit March 29. Tesla settled a race bias case with a Black worker March 15 for an undisclosed amount, ending years of litigation. Both sides had appealed after a federal jury awarded the worker $3.2 million, down from $137 million awarded in a previous trial, which a judge said was unconstitutionally high.

Other workers sued the automaker for allegedly undertaking a mass layoff without providing proper advance notice. Those ex-employees must arbitrate their Worker Adjustment and Retraining Notification—or WARN—Act claims, the US Court of Appeals for the Fifth Circuit said in 2023.

Brown and Okada worked for Tesla at warehouses in Fremont, Calif., in 2022 and 2023. Brown was a nonexempt material handler, and Okada was a nonexempt production associate, according to their complaint. They say Tesla, doing business as Tesla Motors, ran afoul of several California Labor Code provisions and an Industrial Welfare Commission Wage Order.

Improper Break Times

The workers had to clock out for meal breaks, but it took approximately 10 minutes to walk to the cafeteria from their workstations, and another 10 minutes to walk back, so they didn’t get a full 30 minutes for their break, the suit says.

The workers similarly weren’t given proper 10-minute rest breaks, according to the complaint. Tesla required all workers to take breaks at the same time, but it also made them finish whatever they were working on and put tools away before they could go on break, Brown and Okada say.

Tesla made the workers go through security before clocking in, and “it took them approximately 15 minutes just to get to the time clock from when they entered the facility,” the complaint says. They had to repeat the process in reverse when leaving, and weren’t paid for that time, according to the suit. The workers allegedly had to conduct equipment checks and replace batteries before their shifts began.

The workers regularly earned bonuses, but the company didn’t include that extra cash when it calculated their regular rates of pay, the suit says. Not including those numbers means the workers weren’t properly compensated for overtime, according to the complaint. Tesla also required workers to buy steel-toed shoes but didn’t reimburse them, Brown and Okada say.

These practices are “uniform at all distribution facilities in the State of California and are still ongoing,” according to the suit.

Hewgill, Cobb & Lockard and San Diego-based Ben Travis represent the workers.

The case is Brown v. Tesla Inc., E.D. Cal., No. 2:24-at-00418, complaint filed 4/4/24.