Elon Musk to cut Tesla’s workforce by 3.5 percent

A lawsuit against the company alleges it violated U.S. laws with the layoffs

Tesla CEO Elon Musk plans to cut Tesla’s workforce by 3.5 percent.

Musk confirmed the number during an interview with Bloomberg News Editor-in-Chief John Micklethwait at the Qatar Economic Forum on June 21st. Over the next three months, Tesla will cut about 10 percent of its salaried workforce but expects to grow hourly staff, leading to an overall 3.5 percent workforce reduction.

Bloomberg notes that Tesla hired rapidly while building new factories in Austin, Texas and Berlin, Germany. The company has roughly 100,000 employees globally. The cuts have affected human resources representatives and software engineers.

The cuts reportedly took many by surprise, with the company terminating several employees immediately, according to Bloomberg. Two workers at Tesla’s Reno, Nevada battery factory alleged in a lawsuit that the company didn’t comply with the 60-day notification required by the States’ ‘Worker Adjustment and Retraining Notification Act.’

“Let’s not read too much into a preemptive lawsuit that has no standing,” Musk deflected when asked about the lawsuit during the interview.

The Tesla staff reductions come amid Musk’s stance against remote work. Musk has publicly derided work-from-home, and in an email cited by Bloomberg, wrote that Tesla employees are “required to spend a minimum of 40 hours in the office per week.”

Further, Musk claimed in the email that that was why he had “lived in the factory so much — so that those on the line could see me working alongside them.” Musk said if he hadn’t done that, Tesla would have gone bankrupt “long ago.”

Musk’s position on remote work similarly has Twitter employees spooked amid his ongoing attempt to purchase the company. Coupled with Musk’s suggestion there may be layoffs at Twitter if he acquires the company, it’s understandable that people are worried.

Source: Bloomberg