Elon Musk broke the law with a tweet about Tesla stock options, court rules

Elon Musk is CEO of
Tesla.
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Elon Musk broke labor law with a 2018 tweet about Tesla employees’ stock options, a court ruled.
The US 5th Circuit Court of Appeals said Musk threatened staff in the wake of a unionization drive.
It also upheld the reinstatement by Tesla of a worker fired for leading unionizing efforts.

Elon Musk broke federal labor laws when he threatened to strip stock options from employees if they unionized, an appeals court has ruled.

The 5th Circuit US Court of Appeals upheld a previous ruling by the National Labor Relations Board (NLRB) that found Musk had made unlawful threats pertaining to employee remuneration.

The charge came in response to a 2018 tweet when Musk responded to a user who asked him about his views of unions. The action was brought by the United Auto Workers after staff tried to unionize at Tesla’s factory in Fremont, California. 

“Nothing stopping Tesla team at our car plant from voting union. Could do so tmrw if they wanted. But why pay union dues & give up stock options for nothing? Our safety record is 2X better than when plant was UAW & everybody already gets healthcare,” Musk tweeted.

Tesla argued that because Musk said there was nothing stopping Tesla workers joining a union, it couldn’t be regarded as a threat.

However, the 5th Circuit court sided with the NLRB’s initial ruling. 

“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 an implied threat to end stock options as retaliation for unionization,” the panel wrote in its conclusion.

The New Orleans-based court also ordered Musk to delete the tweet, Reuters reported.

The court also upheld an order that Tesla should reinstate Richard Ortiz, a worker who was fired after organizing a union drive at Tesla’s factory in Fremont, California. He will receive backpay following his unlawful dismissal.

Shawn Fain, the UAW’s president, welcomed the rulings but said: “Here is a company that clearly broke the law and yet it is several years down the road before these workers have achieved a modicum of justice.”

The NLRB previously ruled against Tesla last year when the carmaker prevented employees from wearing clothes bearing union insignia. 

Tesla did not immediately respond to a request for comment from Insider, made outside normal working hours.