Speaking of Elon

The  U.S. Court of Appeals for the 5th Circuit just told Elon Musk that he does not get to violate labor laws with impunity.

It appears that threatening employees with the loss of stock options, and firing a labor organizer because he is a labor organizer.

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A federal administrative law judge ruled against Tesla and Musk in 2019, finding among other things that Musk violated labor law with the tweet. The NLRB affirmed that and most other portions of the judge's ruling in 2021. Tesla challenged in the US Court of Appeals for the 5th Circuit, which sided with the NLRB in its ruling on Friday:

Tesla first argues that Musk's May 20, 2018, tweet "was not threatening on its face" because the tweet started out by saying that there was "[n]othing stopping" employees from unionizing and it is a strain to characterize "give up stock options for nothing" as a threat, because, unlike the threat of plant closure, compensation is not within the employer's unilateral control once employees unionize and the parties engage in collective bargaining.

However, because stock options are part of Tesla's employees' compensation, and nothing in the tweet suggested that Tesla would be forced to end stock options or that the UAW would be the cause of giving up stock options, substantial evidence supports the NLRB's conclusion that the tweet is as [sic] an implied threat to end stock options as retaliation for unionization. Moreover, the statement in the tweet is materially similar to other statements that the NLRB and our court have found to be threats.

To Elon though, this is probably a cost of business, but this second bit might irritate him.

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As the ruling notes, Tesla challenged "the NLRB's finding that Tesla CEO Elon Musk posted an unlawful threat on Twitter" and "the NLRB's conclusion that employee Richard Ortiz was unlawfully terminated." The appeals court rejected both of Tesla's arguments and granted the NLRB's cross-application for enforcement of its order, which told Musk to delete the tweet and told Tesla to reinstate Ortiz with back pay.

The court also said the NLRB can enforce other portions of the order that weren't challenged in court. The NLRB found Tesla committed several other violations including interfering with employee leafleting, prohibiting employees from distributing union materials without approval and threatening them with discharge, prohibiting employees from communication with the media about their employment, interrogating certain employees about union activity, and disciplining employee Jose Moran for his union activity.

On the Ortiz firing, Tesla argued that it fired him for lying during an investigation into employee misconduct. Ortiz had posted two screenshots of Tesla employee profiles from the Workday application to a private "Tesla Employees for UAW Representation" Facebook page and criticized those employees for testifying in the California Legislature against legislation supported by the union. His post on the Facebook page also accused one of the employees of "kissing ass and ratting on people."

Ortiz later admitted that he lied when he told a Tesla investigator he didn't remember where he got the screenshots, which he had received from Moran. The appeals court found there is substantial evidence supporting the NLRB finding "that Ortiz was fired for lying about protected union activity and not related to his job performance or Tesla's legitimate business interests or workplace rules, and that union animus motivated—at least in part—the complaint, investigation, and decision to terminate Ortiz."

This, and illegal antitrust activities, should be cases where senior executives are frog marched out of their offices in handcuffs.

What's more, the law firms that sell themselves as putting a legal gloss on illegal anti-union tactics, I'm looking at you Jones Day, should be subject to similar sanctions.

Unless and until people are personally liable for breaking the law, or conspiring to break the law, nothing will change.