Elon Musk recently issued an apology to some laid-off Tesla employees after it was discovered that their severance packages were inaccurately low. In an email sent on Wednesday, Musk acknowledged the error and assured that it was being promptly rectified. The affected employees had initially been offered severance packages equivalent to two months' pay, extending until June 14.
Under the Worker Adjustment and Retraining Notification Act, companies with over 100 employees are required to provide a minimum of sixty days' pay to laid-off workers in the absence of a 60-day notice period before mass layoffs.
Tesla's recent decision to reduce its workforce by more than 10% was communicated to employees via an all-hands email from Musk on Sunday night. Some employees were only made aware of their job status upon arriving at work the following day, with security informing them that their ID badges were no longer active.
One affected employee, Ezekiel Love, who had joined Tesla in Austin just a month prior, expressed financial concerns after losing his job, stating that he is now unable to afford rent. The layoffs coincide with a period of decreased sales for Tesla and heightened competition from local manufacturers in China, a crucial market for the company outside the US.
Notably, Tesla also saw the departure of key senior executives amidst the layoffs. Drew Baglino, who had been with the company for 18 years and served as the head of powertrain and electrical engineering, resigned, citing a difficult decision. Additionally, Rohan Patel, the Vice President of Public Policy and Business Development, announced his exit on the same day.
Meanwhile, Musk is facing legal challenges from four former executives of Twitter, now X, who are collectively suing him for $128 million in unpaid severance. The executives, including the former CEO, CFO, legal chief, and general counsel, were terminated following Musk's acquisition of Twitter in 2022.
Despite these developments, Tesla has not yet responded to requests for comment from Business Insider outside of regular working hours.
