Tesla Pays Out $1M To Former Employee Over Facing Racism At Work: Report - Tesla (NASDAQ:TSLA)

Tesla Inc TSLA has paid a former Black employee more than $1 million after an arbitrator ruled that the automaker failed to stop supervisors from using the “N-word” at a company manufacturing facility in California, Bloomberg Law reported Friday.

What Happened: Melvin Berry, who was hired by Tesla as a materials handler in 2015 left the company 18 months later, as per Bloomberg Law.

The award was reportedly made after a closed-door proceeding and culminates Berry’s years-long struggle.

“I hope the world knows that an arbitrator found Tesla treats its employees like this,” said Berry, as per Bloomberg Law.

“Case law is clear that one instance of a supervisor directing the N-word at a subordinate is sufficient to constitute severe harassment,” said arbitrator Elaine Rushing on May 12 while making the ruling.

Why It Matters: While the arbitration proceedings are secret, Berry’s victory became public after his lawyer Lawrence Organ filed a petition in a court to enforce the arbitrator’s order, as per Bloomberg Law.

Berry’s lawyer reportedly said he won’t be taking any further legal action as the Elon Musk-led company has paid the award.

Tesla made the argument that Berry’s suffering was “garden variety” and he was barred under compensation law for receiving damages for it.

The company also purportedly argued that Berry left his job voluntarily and only deserves $148 for losses.

In 2017, a former assembly worker Marcus Vaughn sued Tesla alleging the automaker had not investigated a written complaint that co-workers and supervisors used the “N-word” on him, reported the Los Angeles Times.

Tesla had at the time denied the allegations and said it takes such complaints when it hears them “seriously.”

Price Action: On Thursday, Tesla shares closed nearly 0.5% higher at $714.63.

Photo: Courtesy of Tesla

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