Tesla responds to claims about foreign workers building its factory for $5/hr and a work accident lawsuit

A report from the Bay Area News Group Watchdog published in the Mercury News this weekend suggests that foreign workers were brought in from Slovenia with nonimmigrant visa for tourism and business, known as a B1, in order to build Tesla’s new paint shop at the Fremont factory in California.

The report described an unfortunately common practice in the construction industry of importing a workforce to do manual labor for low wages. Tesla was used as an example in the article because of the fact that most of the information is coming from a lawsuit between one of those workers, Tesla and their subcontractors following an accident while under their employment.

Now Tesla issued a response to the claims made in the article.

The Mercury News article reported that the company hired by Tesla to build the new paint shop, Eisenmann, in turn hired a subcontractor to recruit workers from other countries:

Recruited by a small Slovenian company called ISM Vuzem, Lesnik, 42, and his co-workers were flown into the U.S. for months at a time, housed in nondescript apartments, and shuttled to the Tesla plant six and sometimes seven days a week, according to workers and the suit.

Again according to the report, the workers entered the country under a visa B1 which shouldn’t have allowed the type of manual labor they were doing. They were also reportedly paid only $5 per hour.

While the lenghty report very much reads like a hit piece on Tesla despite the company being only one small piece of a much bigger puzzle, it is succesful in bringing attention to this despicable practice of exploiting foreign workforces.

Based on the lawsuit, on May 16, 2015, Lesnik, an electrician, climbed atop the paint shop roof and onto an unsecured tile, then fell nearly three stories to the factory floor. He broke both legs, some ribs, tore ligaments in his knee and sustained a concussion.

Now every single party (Tesla, Eisenmann and ISM Vuzem) denies legal responsibility for both the accident and the working conditions, but now Tesla issued a responce again denying any legal responsibility though highlighting moral obligations if the statements made in the report are true.

The company says that its needs to “do right by Mr. Lesnik and his colleagues.”

Here’s Tesla’s response in full:

At Tesla, we aspire to operate on the principles of hard work and exceptional performance, but always tempered by fairness, justice and kindness. There are times when mistakes are made, but those are the standards to which we hold ourselves. With respect to the person at the center of this weekend’s article in the Mercury News, those standards were not met. We are taking action to address this individual’s situation and to put in place additional oversight to ensure that our workplace rules are followed even by sub-subcontractors to prevent such a thing from happening again.

Gregor Lesnik was brought to the Tesla factory by a company called ISM Vuzem, a sub-contractor brought in by Eisenmann, the firm that we hired to construct our new, high-volume paint shop. We contracted with Eisenmann for the simple reason that we do not know how to build paint shops and they are regarded as one of the best, if not the best, in the world. In our dealings with them, we have found them to be an excellent company, run by good people.

The article describes how Mr. Lesnik came to this country, the conditions under which Vuzem employed him and others to do their work, and how Mr. Lesnik ended up being injured while on the job. Assuming the article is correct, we need to do right by Mr. Lesnik and his colleagues from Vuzem. This is not a legal issue, it is a moral issue. As far as the law goes, Tesla did everything correctly. We hired a contractor to do a turnkey project at our factory and, as we always do in these situations, contractually obligated our contractor to comply with all laws in bringing in the resources they felt were needed to do the job.

Regarding the accident that resulted in Mr. Lesnik being injured, Cal/OSHA (the government regulator that investigates workplace accidents like these) came to our factory, investigated the incident and found that Tesla was not responsible. When Mr. Lesnik brought a workers compensation case, Tesla was dismissed from the case because the judge concluded that we had no legal responsibility for what occurred.

All of that is fine legally, but there is a larger point. Morally, we need to give Mr. Lesnik the benefit of the doubt and we need to take care of him. We will make sure this happens. We do not condone people coming to work at a Tesla facility, whether they work for us, one of our contractors or even a sub-subcontractor, under the circumstances described in the article. If Mr. Lesnik or his colleagues were really being paid $5 an hour, that is totally unacceptable. Tesla is one of the highest paying hourly employers in the US automotive industry. We do this out of choice, because we think it is right. Nobody is making us do so.

Tesla will be working with Eisenmann and Vuzem to investigate this thoroughly. If the claims are true, Tesla will take action to ensure that the right thing happens and all are treated fairly.

Creating a new car company is extremely difficult and fraught with risk, but we will never be a company that by our action does, or by our inaction allows, the wrong thing to happen just to save money.