Dive Brief:
- Electric car manufacturer Tesla and contractors on one of its factory renovations have settled a lawsuit with injured foreign worker Gregor Lesnik for $550,000, the Mercury News reported.
- The award amount is for unpaid wages and serious injuries Lesnik incurred when he fell three stories from a paint-shop roof in May 2015, with $400,000 to satisfy the civil lawsuit and $150,000 for the workers' compensation portion of Lesnik's claim.
- The decision paves the way for 140 additional Slovenian workers on the project to sue for what they allege is almost $2.6 million in promised yet unpaid wages.
Dive Insight:
According to a Mercury News investigation in May, contractors Eisenmann and ISM Vuzen brought approximately 200 workers from Slovenia on visas that do not allow construction work and paid the employees at rates as low as $5 an hour, even though the workers claim they were promised $55 an hour. Tesla CEO Elon Musk said at the time that he paid the contractors $55 an hour for labor on the project.
In a somewhat similar case, New York contractor Beacon restoration had to pay the New York City Comptroller's office $364 million after the agency concluded that Beacon had underpaid immigrant roofers. Beacon also lost its right to participate in New York state public works projects for five years.
The allegations that arose from the Tesla lawsuit drew the ire of U.S. Sen. Charles Grassley (R-IA), who requested that federal agencies investigate what kind of visas were used to bring workers from Slovenia. Not stopping at Tesla, Grassley expanded his request to include a review of enforcement of the work visa program in general, as well as other companies with foreign workers.
Tesla also continues to experience blowback from wage disputes on its $5 billion gigafactory project in Reno, NV. Workers walked off the project in February after they said a contractor was staffing the job with cheap out-of-state labor in contradiction to a promise Tesla made to hire a majority of Nevadans. Construction workers eventually returned to the job, but local union officials said they would continue to monitor the project for adherence to required hiring practices.
Earlier this year, trade union representatives gave CEO Elon Musk with a letter asking him to honor his hiring promises.