Tesla, Inc. was sued by Owen Diaz for unethical practices associated with racial discrimination in the workplace. Owen Diaz was an elevator operator at the Tesla Fremont Factory. Black workers have testified that they were subjected to racial drawings, racist slurs, and were given the most physically demanding work. The working condition in that factory was such that the black employees had been forced to quit. The case was filed by the California State agency. In the case of Diaz v. Tesla, a former contingent worker claims that he was subjected to race discrimination while working at Tesla's Fremont Factory from 2015 to 2016. A jury in the Northern District of California returned a verdict of $136.9 million against Tesla on October 4, 2021. 

Tesla filed a post-trial motion requesting a new trial or to reduce the jury's damage. On April 13, 2022, the court reduced the total damage to $15 million on a condition that denied the motion for new trial subject to the plaintiff's acceptance of the reduced reward (Tesla, Inc - Sec 10k, 2022). The reduced damage was rejected by the plaintiffs on 21 June 2022, resulting in the court ordering a new trial to commence on 27 March 2023. 

Tesla continues to argue that the law and the facts do not justify the damages awarded. The company is assessing its next steps to avoid the jury's damage. It has implemented various policies in the recent years to prevent such occurrence of racism and punish it when it does occur (Wiessner & Jin, 2022). It could have been prevented through continuous surveillance over its management in different regions.

 

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Do you feel that the monetary fine in that magnitude was the correct punishment and award?

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