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Former Tesla employees remain troubled, confused by firings

Louis Hansen, The Mercury News on

Published in Automotive News

Frank Morales joined Tesla about four years ago, eager to work for a growing company.

Morales handled the aggressive deadlines of the Tesla warehouse -- until last month. He said he received years of strong performance reviews, but was fired one day "with no warning."

A friend and a cousin recently asked him if they should go to work for the carmaker. "I told them no," Morales said. "Stay where you're at."

Tesla's dismissal of 700 workers in October has former employees angry and outspoken. Some, like Morales, have refused to a sign a separation agreement they feel is unfair and restrictive. The agreement bars former employees from disparaging the company or the executives who fired them, according to a copy obtained by the Mercury News.

Tesla also faces ongoing protests, lawsuits and federal complaints from former workers and workers seeking to unionize, and is again aggressively defending its image.

The disruptions come as the company battles the enormous task of hiring, training and expanding a skilled workforce to produce a new vehicle -- the delayed, lower-cost Model 3 -- that is important to its success and survival.


Experts in human resources and employment law say the abrupt dismissals and upheaval could have lasting consequences for the Tesla brand and the company's ability to attract talented engineers and factory workers.

"You really need to plan (terminations) very, very carefully, because it's about people," said Sanjay Sathe, CEO of placement support agency RiseSmart. The former workers could be future customers or even rehired as production demands increase, Sathe said. And bad word-of-mouth reviews can spread quickly on social media.

CEO Elon Musk acknowledged for the first time this month that the company had fired 700 employees, saying it was for poor performance. Tesla sets high work standards, he said, because it must be better than its bigger competition. "They're high because, if they're not high, we will die," Musk said.

He complained that the October terminations became public and added that journalists should "be ashamed" for writing about a turnover of 2 percent of the public company's employees.


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