Former Tesla Employee Rejects $15 million Settlement

July 8, 2022, 9:30AM. By Jane Mundy

A former Tesla employee was given two weeks to accept or reject his drastically reduced discrimination settlement-- Owen Diaz rejected $15 million.

Fremont, CAA federal jury in San Francisco last October agreed with plaintiff Owen Diaz that Tesla had created a hostile environment and discriminated against the former worker—who is black -- at its Fremont factory. Tesla was ordered to pay $137 million in the California labor lawsuit but a U.S. District Judge reduced the amount to $15 million.

Diaz, a former a black former elevator operator and contract employee, worked at Tesla for nine months beginning in late 2015. He claimed the car maker ignored racial abuse hurled at himself and other black workers by colleagues and a supervisor at the Fremont plant.

In his lawsuit Diaz said Tesla employees called him the N-word, told him to “go back to Africa" and drew racist and derogatory pictures, including swastikas, that were left around the factory.  At first, Diaz was excited to land a job in a “modern workplace” but it turned out to be a "scene straight from the Jim Crow era." During the trial, Diaz said he faced “daily racist epithets," but supervisors did nothing to stop the abuse. He complained not only to Tesla but also to contracting companies Citistaff and nextSource – still nothing was done.


Tesla countered by saying two abusive contractors were fired and a third was suspended when Diaz complained about discriminatory comments and therefore the initial verdict – in October 2021-- was not justified.

Diaz Rejects $15 million

On June 7, Judge William Orrick gave Diaz two weeks to decide whether to accept or reject the reduced award. On June 21 he rejected the judge's award in federal court in San Francisco and asked for a new workplace discrimination trial, according to Reuters. Diaz’s lawyers want a new trial because Orrick’s decision was unjust, undermining his constitutional right to a trial by jury.  So, this trial will be more than a discrimination lawsuit. Reuters continued: To be more straightforward, if the jury granted him $136.9 million [the $130 million in punitive damages is one of the highest compensations ever awarded to a single worker in a discrimination lawsuit], reducing that amount makes it seem that the jury’s decision does not count. Ultimately, that’s the most crucial discussion the next trial will promote.”

"In rejecting the court’s excessive reduction by asking for a new trial, Mr. Diaz is again asking a jury of his peers to evaluate what Tesla did to him and to provide just compensation for the torrent of racist slurs that was directed at him,” said Lawrence Organ, his attorney from the California Civil Rights Law Group. “It’s a great thing when one of the richest corporations in America has to have a reckoning of the abhorrent conditions at its factory for Black people,” Organ said, as reported by the New York Times.

More Tesla Discrimination and Harassment Lawsuits

The Los Angeles Times in February 2022 reported that California’s civil rights agency filed a lawsuit accusing Tesla of segregating Black workers into separate areas that its employees referred to as “porch monkey stations,” “the dark side,” “the slave ship” and “the plantation,”. Black workers complained of abuse for more than a decade, which led to a 32-month investigation. 

Only Black workers had to scrub floors on their hands and knees, and they were relegated to the Fremont, Calif., factory’s most difficult physical jobs, according to the lawsuit.

And the California Department of Fair Employment and Housing (DFEH), is also suing the smart car company over further allegations of racism and harassment toward Black employees at the same factory, reported AfroTech, Diaz turned his back on $15 million. What if the new jury awards him less? It’s a given: A new jury will agree with Judge Orrick that $137 million was excessive. Judge Orrick has scheduled a trial-setting conference for July 12, 2022.