14 ms·

Tesla's mass firings spread to SolarCity

160 points by whatok 9y ago

frgtpsswrdlame 9y ago
Sources said that HR department representatives told staff in one office they were being let go due to problematic "conduct with peers." When questioned, an ex-employee said, HR declined to specify any details about the alleged poor conduct, which had never been previously discussed. <tin foil hat> Is this pre-empting a union push?
- whatok 9y ago
  Not clear as to whether those were SolarCity or Tesla (direct) employees.
- YurtleTheTurtle 9y ago
  No it's preempting going broke. Especially since Elon is one of the combined companies biggest creditors and has his own personal finances deeply entwined with that of the company. (See also Sears / Eddie Lampert)
  - lafar6502 9y ago
    Yep they got so much money for nothing and still prefer to rip off their people
- jerf 9y ago
  "Is this pre-empting a union push?" Honest clarification request: Do you to suggest/worry that they are classifying "agitating for a union" as problematic "conduct with peers"? (If so, I expect we'll hear if that's the case soon, with a chance of hearing that even if it's not the case. That is a storyline the media would be salivating to run.)
  - rhizome 9y ago
    Honest clarification request: Do you to suggest/worry that they are classifying "agitating for a union" as problematic "conduct with peers"? That's the way I read it.
  - frgtpsswrdlame 9y ago
    Basically yes. Perhaps "problematic conduct with peers" is poor wording or maybe it refers to some harrassment crackdown or maybe it's due to financial problems, really it could be any number of things but because it's Tesla the union connection is what comes to mind. Regardless it's obvious they're firing people for something they don't want to be connected to and using 'performance' as a smoke screen.
  - gozur88 9y ago
    That wouldn't make much sense, though. The last thing you'd want to do if you were trying to keep out a union is behave in a way your employees would see as tyrannical.
    - corin_ 9y ago
      Well there's two opposite ways that have historically been tried to avoid unionisation - you can make sure employees are all happy enough not to want it, or make sure they're too scared of losing their jobs should they support it.
- MikeTheGreat 9y ago
  I remember a while back some .com company laid off a bunch of their employees (more than 40%? 50%?). Firing that many people at once triggered a set of 'lay off' laws, which required certain behavior from the company (such as giving the employees X days notice, etc, etc). This is pure speculation, but I wonder if Telsa is trying to do last-minute layoffs while avoiding whatever 'lay off laws' there are by claiming that each individual is totally being fired for totally legit individual reasons, for sure, yep.
  - archildress 9y ago
    The provision you're referring to is called a WARN notice. Employers with 100 or more employees typically are required to give 60 days notice.
  - sjg007 9y ago
    The Department of Labor usually investigates these things.
    - brewdad 9y ago
      This is not your father's Department of Labor. I see little chance that any enforcement will happen.
      - turk184 9y ago
        What the hell does that even mean? When my father had trouble with his union doing illegal shit in the 1980s, the Dept. of Labor back then was useless, as was the NLRB, and when the trouble became to violent threats, the FBI was zero help, too! I know you meant that as a veiled criticism of Trump, but here's the reality: The US government under Trump is getting itself turned around after decades of mismanagement. It won't happen overnight, but there are clearly much-needed reforms in progress and a lot of people don't like that. And the rest just take cheap shots because they simply don't know any better.
  - gozur88 9y ago
    Companies don't fire for cause very much. It's just asking for a wrongful termination lawsuit.
- logfromblammo 9y ago
  It certainly is suspicious that people were fired "for performance reasons" when the company is unable or unwilling to provide the performance data that would support that assertion. But, on the other hand, these employees were probably "at will", so the company does not need to give any reason, or even to publicly justify the firings in any way. So it could be that "performance" is the lie that they believe to damage ongoing recruiting efforts the least. Or it could be that they have determined individual performance assessments to be useless in the face of the more objectively measurable department-wide performance numbers. All I know for certain is that I won't be sending them any applications or resumes until they can elucidate their motives behind this. The simplest explanation is that the company isn't making money and investors are getting antsy about bankruptcy.
  - YurtleTheTurtle 9y ago
    California is at will but they do have specific laws and procedures for mass firings and layoffs. I think Tesla is trying to skirt these by calling them performance related instead of layoffs. (And to protect their stock price from having to admit they can't afford all their workers.)
  - sjg007 9y ago
    The company does have to prove that they didn't fire someone for a restricted reason and basically if there's any hint of that it is viewed poorly by the govt/courts. I imagine a lot of lawyers will gear up here and there will be a lot of eDiscovery.
  - Spooky23 9y ago
    You can fire people for any reason, but there are costs involved in laying people off. HR is a cynical business. Requiring stuff like training your outsourced replacement is also a strategy here — the longer you hang on to “undead” employees, the more likelihood they will leave voluntarily.
- jmcgough 9y ago
  Tesla has been waging an internal war against union formation, so wouldn't surprise me if they were firing people they saw as pushing unionization.
  - wbl 9y ago
    That's a surefire way to get hauled up before the NLRB. I'm not surprised companies try it, but they usually get sued for it.
    - twoquestions 9y ago
      NLRB still exists? I honestly thought the new administration got rid of that.
      - gowld 9y ago
        You don't think that would have been announced somewhere in the news, if it had happened?
    - pktgen 9y ago
      The NLRB already filed a complaint against Tesla recently: https://cdn.arstechnica.net/wp-content/uploads/2017/09/CPT.32-CA-197020-et-al.pdf https://cdn.arstechnica.net/wp-content/uploads/2017/09/CPT.3....
- Bartweiss 9y ago
  It doesn't seem impossible on the corporate side, but I'd be surprised if it was true and yet none of the newly-fired employees speaking anonymously to the media raised the point.
- dver 9y ago
  Your peers were here on weekends and you were not.
  - chrisbennet 9y ago
    Your peers drank the coolaid an you did not. “You make the rest of us look bad when you don’t donate your weekend to The Company. Wouldn’t you rather make Our Leader richer instead of being with your family?”
- Spooky23 9y ago
  For cause terminated employees don’t get unemployment. My guess is that since Musk companies don’t feel constrained by rules, they figure they’ll save money in UI taxes by forcing workers to adjudicate their UI benefits. They get the benefit of cooking their balance sheet as an additional benefit.
  - aplusbi 9y ago
    >For cause terminated employees don’t get unemployment. For the most part this isn't true - only intentional misconduct is grounds for not receiving unemployment.
mtgx 9y ago
If there was one division at Tesla that deserved lay-offs, surely it was SolarCity? I remember how everyone was talking about what a bad move Tesla made in acquiring SolarCity, because the company was a mess and unprofitable. I've also heard stories about how aggressive and pushy SolarCity's sales people were with customers, which ended-up giving the company an increasingly worse reputation.
- ghostbrainalpha 9y ago
  Solar City was doing fantastic here in Las Vegas. There sales people were BY FAR the best when they came door to door. But Warren Buffet's power company changed the laws last year and basically screwed everyone who had solar. We have completely disincentivized putting solar panels up. Now the company doesn't do well, and no sales people come door to door from any company. If you are putting up solar in Las Vegas this year, its because you are an extreme environmentalist and willing to pay the penalty that comes with it.
  - Siecje 9y ago
    How did the laws change?
    - ghostbrainalpha 9y ago
      https://www.reviewjournal.com/business/energy/solarcity-stopping-nevada-sales-installations-after-puc-ruling/ https://www.reviewjournal.com/business/energy/solarcity-stop... >>The PUC “has effectively shut down the rooftop-solar industry and taken the extraordinary step to punish over 12,000 existing solar customers, including schools, with exorbitant fees in what appears to be an attempt to protect the profits of the state’s largest utility. All three members of the PUC, who voted unanimously to change the rules, were appointed by Governor Sandoval.” >>Rive said: “Most disturbing is the PUC’s decision to retroactively sabotage existing solar customers’ investments by changing the rules on them. The Nevada government encouraged these people to go solar with financial incentives and pro-solar policies, and now the same government is punishing them for their decision with new costs they couldn’t have foreseen. These actions are certainly unethical, unprecedented, and possibly unlawful. While the rest of the country embraces a clean energy future, Nevada is moving backwards.”
seibelj 9y ago
Couldn't Tesla / SolarCity just said, "Hey, company didn't do well, sorry, here's 2 weeks severance"? Why do this whole "bad performance review" nonsense.
- aslkdjaslkdj 9y ago
  Because the stock price would drop and Tesla wants to do another round of funding (aka issue more stock) soon.
  - skgoa 9y ago
    The stock price has dropped by $64 since the start of the week BTW. It was at $325 when I checked earlier today and came from a high of $389.
    - dtparr 9y ago
      That's not correct. $389 is its all-time high. It closed at ~$345 on Friday and opened ~$350 on Monday.
      - kunaalarya 9y ago
        it's literally $325 right now so what's not correct?
        dtparr 9y ago
        skgoa said "The stock price has dropped by $64 since the start of the week BTW." It has dropped ~$25 since the start of the week. It's down $64 from its all-time high.
- IanDrake 9y ago
  I don’t know why you got down voted. That’s what Tesla should have done if they haven’t documented any performance problems. What they did is basically slander with real economic consequences to those fired and they should sue. Being fired with cause impacts their ability to collect unemployment, which most these people deserve. It also puts a bad mark on their employment history, unless they lie about how they where fired.
SubiculumCode 9y ago
I am pretty pro-union. However, in the case of Musk's enterprises, where there is this larger goal that is finally seeming to become possible, I am torn. I feel that anyone that works at these places should know and be a zealot for the Cause...but I suppose that Elon Musk probably should share his stakes with them a bit more, in that case. edit: I believe workers should be treated fairly, but I also want us to go to Mars. If 1 prevented 2, I would be torn. Why should this earn a negative vote?
- adamsea 9y ago
  The ends justify the means, eh?
  - SubiculumCode 9y ago
    Sometimes, indeed yes. Not always. If you want to live in a black and white world go ahead. Best of luck to you. In any case, as I said, I am torn. That is why I advise that anyone that works for them be dedicated to the cause. Because while a lot of startups and the like profess to "change the world" Elon Musk's enterprises ARE changing the world to the kind of world I want to live in. Sometime visions need sacrifices. That said, Elon Musk should probably offer non-insubstantial stakes in the company to every worker.
    - dgritsko 9y ago
      Scott Alexander had a blog post recently discussing "moral offsets" and the distinction between axiology, morality, and law. It helped clarify my own mental framework and vocabulary for thinking through these sorts of "do the ends justify the means?" issues. I found it to be interesting food for thought and you may feel likewise, it's a very thought-provoking read (as is nearly everything on Scott's site). http://slatestarcodex.com/2017/08/28/contra-askell-on-moral-offsets/ http://slatestarcodex.com/2017/08/28/contra-askell-on-moral-...
      - SubiculumCode 9y ago
        Thanks for the link. Indeed a post for thought.
20years 9y ago
This doesn't really surprise me. A few years ago we had lead generation software that catered to the solar industry. We had some decent sized clients and it did really well for about 2 years. Once the tax credits started going away and the power companies started killing off their rebates, a lot of these solar companies were not able to survive. One of our larger clients who was heavily funded went bankrupt this year and many of the smaller/mid sized clients have folded within the last year too. It is risky basing too much of a business on tax credits and rebates.
- jack6e 9y ago
  I was thinking this myself. For all of Musk's braggadocio about not needing, and even being hurt by, subsidies, Tesla, whose profits only become more negative every quarter, has had its sales decimated in the countries that ended tax breaks for electric vehicles. With the specter of a major tax overhaul and massive spending cuts, a major recall, and still not enough strength to stand on its own, Musk has to be at least a little worried about Tesla's future and the futures of his other pet projects.
- matt_wulfeck 9y ago
  I’m surprised. At the rate PV has been falling these subsidies are probably negligible (federal rebate withstanding). I purchased PV because the cost with a 20-year loan comes out to be 13c kWh, meanwhile PG&E charges 29c kWh. And the loan interest is tax-deductible.
  - sgc 9y ago
    What company did you use? I have received 3 quotes and none make much sense.
    - matt_wulfeck 9y ago
      Solarcity. Highly recommended.
      - sgc 9y ago
deleted 9y ago
[deleted]
montyboy_us 9y ago
SpaceX, Tesla, and SolarCity: ponzi schemes that have a little tech behind them and pull on our heartstrings.
- vormalpg 9y ago
  Compared to the pure software startups whose announcements are splashed all over the front pages of ycombinator, who are generally trying to spin old and boring ideas as grand innovation, I'd say there's a lot of tech behind these companies.
- Bartweiss 9y ago
  ...can you give any context on how that applies to SpaceX? I think you're overstating the case for all three, because Tesla is a normal company that may or may not succeed, and SolarCity isn't a Ponzi scheme but simply a business dependent on regulatory decisions (like most every solar company). But the inclusion of SpaceX there is frankly baffling to me; it's a completely different business model only tied to the others by Musk's involvement. And their "little tech" has involved at least two major achievements no one else has ever come close to. Maybe they lose to Orbital or NASA stops outsourcing or something, but "sometimes companies fail" is a far cry from "Ponzi scheme".
- ctdonath 9y ago
  Ponzi schemes don't produce major technological advancement. SpaceX made reusable rockets a thing. Tesla made great cars with bleeding-edge EV technology. SolarCity made "solar roof" a viable & aesthetic product. All three are still thriving on a lot of tech advancement. Long-term success remains to be seen in three very difficult industries, but current performance is certainly not the facades of Ponzi schemes.
  - ForHackernews 9y ago
    > SpaceX made reusable rockets a thing. The space shuttle was reusable. It just wasn't cost-effective. So far, SpaceX hasn't proven their resuable rocket is cost-effective either. > Tesla made great cars with bleeding-edge EV technology. Model X ranked dead last in reliability: https://www.cnet.com/roadshow/news/consumer-reports-survey-marks-tesla-model-x-as-least-reliable/ https://www.cnet.com/roadshow/news/consumer-reports-survey-m... Model S owners have also complained about reliability and build quality problems. I don't know much about SolarCity as a business, but the Tesla buyout has a lot of sketchy signs about it https://www.fool.com/investing/2017/10/18/solarcity-teslas-solar-boondoggle.aspx https://www.fool.com/investing/2017/10/18/solarcity-teslas-s... I don't necessarily think Musk's companies are literally "Ponzi schemes", but they are less impressive than the hype surrounding them, and they all rely heavily on government subsidies. I just wish HN would take the same critical eye to Musk that it does toward other business luminaries. It seems like far too many people are easily seduced by "Mars colony! Hyperloop! Rocket around the world!"
thejerz 9y ago
Has anyone else noticed a PR smear campaign against Tesla?
- skybrian 9y ago
  It can be explained by the usual press cycle. Once something becomes famous enough, they are automatically a news hook. Any surprising news about them (positive or negative) gets clicks.
- vormalpg 9y ago
  The only thing resembling a campaign one may notice is the breathless praise heaped on Elon Musk by his army of fanboys whenever Tesla or SpaceX are on the receiving end of criticism from the media. It's surpassed even a Steve Jobs tier of cultism.
- glibgil 9y ago
  Anyone else? You haven’t even noticed it. Unless, you want to cite some examples
- VectorLock 9y ago
  Blame the Russians. They seem to have the right intersection of effective propaganda machinery and oil interests.
11thEarlOfMar 9y ago
1,200 of 33,000 employees amounts to 3.6% of the work force. This level of action, 1 in 25 employees, gives managers an opportunity to release employees that looked good in the interview but did not meet expectations. Whether Tesla conducted this in a proper manner is open to debate and perhaps details will emerge if/when any former employees pursue Tesla in court. But any company needs to address the inevitable hiring mistakes and I don't see evidence that Tesla is doing any more than that.
- Bartweiss 9y ago
  > I don't see evidence that Tesla is doing any more than that If the lack of promised performance reviews is accurate, that's the obvious issue - it implies a labor force decision disguised as a performance decision. This is a pretty common move in e.g. game development, so it certainly isn't unthinkable. The point about total workforce size is well taken, though; this still seems like it could be as simple as "times are tough so we're cutting more stringently than we might otherwise".
  - walshemj 9y ago
    Then the WARN act applies
    - deleted 9y ago
      [deleted]
  - SRasch 9y ago
    Would you say 3,6 % is that stringent though? I remember GE under Welch fired 10 % of the lowest performers every year, that seemed kind of stringent. But Tesla is fast-hiring and acquiring, so seem to have a larger need to fix hiring-errors than GE. At the end of 2015 they had only 14,000 employees! In light of that, 3,6 % seems completely reasonable to me. Low, even. Concerning the performance review: would expect that after acquisition, SolarCity would adjust to Tesla's performance standards. So even if they were based on prior performance reviews, still seems like a reasonable action and level to me. As much as I try to squint, I'm having troubles seeing the smoking gun here.
msoad 9y ago
Call layoffs "firing" to look good in stock market and not have to pay severance packages... Elon is smart for sure
- jcadam 9y ago
  I dunno, my Tesla stock just took a big dump. Maybe I should sell.
smaili 9y ago
> SolarCity employees say they were surprised to be told they were fired for performance reasons, claiming Tesla had not conducted performance reviews since acquiring the solar energy business. Is it possible the performance reasons cited may have been in reference to performance in sales rather than performance in work? Otherwise it does seem odd to dismiss over employee performance if reviews has yet to be conducted by Tesla.
protomyth 9y ago
Does anyone know if the reason Tesla gave is interfering with the newly fired collecting unemployment? There are certain types of firing that would stop someone from being able to collect unemployment.
calvinbhai 9y ago
I’ve been with a bunch of smaller companies and have seen layoffs as well as been laid off before/during and after mergers. Not sure why this should be surprising in the case of Tesla + Solar City.
- jonathankoren 9y ago
  Because the purported reason for the firings don't add up. Usually in a merger, the combined company simply says what everyone already knows, there's redundancies.
- mhermher 9y ago
  It's mostly of note precisely because they are not layoffs according to Tesla. They were full on fired with cause. It's strange to say the least. What would trigger a mass firing like that. It's unusual.
  - city41 9y ago
    I'm a SolarCity customer and absolutely despise them. Their customer service makes Comcast look like a saint. I can't help but cross my fingers this is a sign Tesla might be doing something about it. But I'm not getting too hopeful.
    - sgc 9y ago
      I had them come by for a quote. I never bothered to put their numbers in to compare to other offers because it was a terrible experience. I have no idea if they are even working on changing that, or just pivoting to industrial installations.
Animats 9y ago
At Solar City, sales must be down if they're closing entire offices.
- sandstrom 9y ago
  or redundant if they're using their Tesla stores to sell solar panels after the merger
pdimitar 9y ago
- It's not mass firing. It's not even 4% of the workforce. - So, employees were "surprised". As most people who are fired, ever, in any company and epoch. How is this news at all? - Recalling 11,000 units might not at all be connected with layoffs. Implying otherwise is a cheap yellow press journalism. - "Citing fears of retaliation from Tesla". Yeah, because Tesla definitely is known for pursuing people like they're some kind of a cold-war era vengeful spy agency. Sure. - Some layoffs came 2 weeks early. Wow. Scandalous! - Somebody made the mistake of over-stating how much personnel a new office is gonna have. Surely, this is news-worthy, right? - Exact number of people laid off is unknown so hey, I have a genius idea, let's listen to the former employees who are now negatively biased against the company. I mean, they can't be wrong, could they? And then the company tries to minimize the chance of former employees suing them. That's relatively normal if somewhat scummy, sadly it's a pretty classic state of affairs. Hardly exclusive to Tesla, though. This "tech reporter" would do well to work with paparazzi. It'll match her journalistic expertise.
- gowld 9y ago
  "Mass layoff" is defined by the United States Department of Labor as 50 or more workers laid off from the same company around the same time.
  - pdimitar 9y ago
    Might be legally correct. Still gives the wrong impression because most people aren't lawyers. Should outline percentage, not absolute numbers, IMO.
    - tabeth 9y ago
      If the unemployment rate increased 3.6% tomorrow, I guess you wouldn't think it's a big deal, right? After all, it's not even 4%! The lack of sympathy people show these days. Sheesh.
      - pdimitar 9y ago
        It's one company out of hundreds of thousands. You did not address all of my criticisms of the article which are logically sound -- you only cherry-picked one emotional point.
Dirlewanger 9y ago
>Some of the firings came in big group employee meetings. WOW. Great place to work. Yet gives a shit when their stock is like 60% up YTD, right? /s
yuhong 9y ago
I wonder if the ideas of centralised layoffs based on performance reviews is even a good idea at all, especially for anything other than manual labor and the like.
xvikram 9y ago
While I do commend Musk's role in getting change within industries, it can't be argued that his biggest strength over the last decade has been only PR (and I mean only!). Do some digging and see how he chooses to release news bits, diversions etc and holds on to the mastermind billionaire ideal that people bestowed upon him. Any other company making false promises ("Auto"pilot), providing factually incorrect data (Model 3 "mass" production), mass firings ("performance" layoffs) would not survive in the world. Musk just dumbs down science to his cult and they swallow it up. Remind you of anyone else? (hmmmm... Trump - different audience of course but similar cult following characteristics). Tesla responding to lawsuits by former employees claiming they suffered racial discrimination and anti-LGBT threats (in The Guardian): “There is no company on earth with a better track record than Tesla.” Trump, March 2016: "Nobody knows more about trade than me." Don't think any other person/entity give out such absolute statements routinely.

160 points by whatok 9y ago

Sources said that HR department representatives told staff in one office they were being let go due to problematic "conduct with peers." When questioned, an ex-employee said, HR declined to specify any details about the alleged poor conduct, which had never been previously discussed. <tin foil hat> Is this pre-empting a union push?

whatok 9y ago
Not clear as to whether those were SolarCity or Tesla (direct) employees.
YurtleTheTurtle 9y ago
No it's preempting going broke. Especially since Elon is one of the combined companies biggest creditors and has his own personal finances deeply entwined with that of the company. (See also Sears / Eddie Lampert)
- lafar6502 9y ago
  Yep they got so much money for nothing and still prefer to rip off their people
jerf 9y ago
"Is this pre-empting a union push?" Honest clarification request: Do you to suggest/worry that they are classifying "agitating for a union" as problematic "conduct with peers"? (If so, I expect we'll hear if that's the case soon, with a chance of hearing that even if it's not the case. That is a storyline the media would be salivating to run.)
- rhizome 9y ago
  Honest clarification request: Do you to suggest/worry that they are classifying "agitating for a union" as problematic "conduct with peers"? That's the way I read it.
- frgtpsswrdlame 9y ago
  Basically yes. Perhaps "problematic conduct with peers" is poor wording or maybe it refers to some harrassment crackdown or maybe it's due to financial problems, really it could be any number of things but because it's Tesla the union connection is what comes to mind. Regardless it's obvious they're firing people for something they don't want to be connected to and using 'performance' as a smoke screen.
- gozur88 9y ago
  That wouldn't make much sense, though. The last thing you'd want to do if you were trying to keep out a union is behave in a way your employees would see as tyrannical.
  - corin_ 9y ago
    Well there's two opposite ways that have historically been tried to avoid unionisation - you can make sure employees are all happy enough not to want it, or make sure they're too scared of losing their jobs should they support it.
MikeTheGreat 9y ago
I remember a while back some .com company laid off a bunch of their employees (more than 40%? 50%?). Firing that many people at once triggered a set of 'lay off' laws, which required certain behavior from the company (such as giving the employees X days notice, etc, etc). This is pure speculation, but I wonder if Telsa is trying to do last-minute layoffs while avoiding whatever 'lay off laws' there are by claiming that each individual is totally being fired for totally legit individual reasons, for sure, yep.
- archildress 9y ago
  The provision you're referring to is called a WARN notice. Employers with 100 or more employees typically are required to give 60 days notice.
- sjg007 9y ago
  The Department of Labor usually investigates these things.
  - brewdad 9y ago
    This is not your father's Department of Labor. I see little chance that any enforcement will happen.
    - turk184 9y ago
      What the hell does that even mean? When my father had trouble with his union doing illegal shit in the 1980s, the Dept. of Labor back then was useless, as was the NLRB, and when the trouble became to violent threats, the FBI was zero help, too! I know you meant that as a veiled criticism of Trump, but here's the reality: The US government under Trump is getting itself turned around after decades of mismanagement. It won't happen overnight, but there are clearly much-needed reforms in progress and a lot of people don't like that. And the rest just take cheap shots because they simply don't know any better.
- gozur88 9y ago
  Companies don't fire for cause very much. It's just asking for a wrongful termination lawsuit.
logfromblammo 9y ago
It certainly is suspicious that people were fired "for performance reasons" when the company is unable or unwilling to provide the performance data that would support that assertion. But, on the other hand, these employees were probably "at will", so the company does not need to give any reason, or even to publicly justify the firings in any way. So it could be that "performance" is the lie that they believe to damage ongoing recruiting efforts the least. Or it could be that they have determined individual performance assessments to be useless in the face of the more objectively measurable department-wide performance numbers. All I know for certain is that I won't be sending them any applications or resumes until they can elucidate their motives behind this. The simplest explanation is that the company isn't making money and investors are getting antsy about bankruptcy.
- YurtleTheTurtle 9y ago
  California is at will but they do have specific laws and procedures for mass firings and layoffs. I think Tesla is trying to skirt these by calling them performance related instead of layoffs. (And to protect their stock price from having to admit they can't afford all their workers.)
- sjg007 9y ago
  The company does have to prove that they didn't fire someone for a restricted reason and basically if there's any hint of that it is viewed poorly by the govt/courts. I imagine a lot of lawyers will gear up here and there will be a lot of eDiscovery.
- Spooky23 9y ago
  You can fire people for any reason, but there are costs involved in laying people off. HR is a cynical business. Requiring stuff like training your outsourced replacement is also a strategy here — the longer you hang on to “undead” employees, the more likelihood they will leave voluntarily.
jmcgough 9y ago
Tesla has been waging an internal war against union formation, so wouldn't surprise me if they were firing people they saw as pushing unionization.
- wbl 9y ago
  That's a surefire way to get hauled up before the NLRB. I'm not surprised companies try it, but they usually get sued for it.
  - twoquestions 9y ago
    NLRB still exists? I honestly thought the new administration got rid of that.
    - gowld 9y ago
      You don't think that would have been announced somewhere in the news, if it had happened?
  - pktgen 9y ago
    The NLRB already filed a complaint against Tesla recently: https://cdn.arstechnica.net/wp-content/uploads/2017/09/CPT.32-CA-197020-et-al.pdf https://cdn.arstechnica.net/wp-content/uploads/2017/09/CPT.3....
Bartweiss 9y ago
It doesn't seem impossible on the corporate side, but I'd be surprised if it was true and yet none of the newly-fired employees speaking anonymously to the media raised the point.
dver 9y ago
Your peers were here on weekends and you were not.
- chrisbennet 9y ago
  Your peers drank the coolaid an you did not. “You make the rest of us look bad when you don’t donate your weekend to The Company. Wouldn’t you rather make Our Leader richer instead of being with your family?”
Spooky23 9y ago
For cause terminated employees don’t get unemployment. My guess is that since Musk companies don’t feel constrained by rules, they figure they’ll save money in UI taxes by forcing workers to adjudicate their UI benefits. They get the benefit of cooking their balance sheet as an additional benefit.
- aplusbi 9y ago
  >For cause terminated employees don’t get unemployment. For the most part this isn't true - only intentional misconduct is grounds for not receiving unemployment.

mtgx 9y ago

If there was one division at Tesla that deserved lay-offs, surely it was SolarCity? I remember how everyone was talking about what a bad move Tesla made in acquiring SolarCity, because the company was a mess and unprofitable. I've also heard stories about how aggressive and pushy SolarCity's sales people were with customers, which ended-up giving the company an increasingly worse reputation.

ghostbrainalpha 9y ago
Solar City was doing fantastic here in Las Vegas. There sales people were BY FAR the best when they came door to door. But Warren Buffet's power company changed the laws last year and basically screwed everyone who had solar. We have completely disincentivized putting solar panels up. Now the company doesn't do well, and no sales people come door to door from any company. If you are putting up solar in Las Vegas this year, its because you are an extreme environmentalist and willing to pay the penalty that comes with it.
- Siecje 9y ago
  How did the laws change?
  - ghostbrainalpha 9y ago
    https://www.reviewjournal.com/business/energy/solarcity-stopping-nevada-sales-installations-after-puc-ruling/ https://www.reviewjournal.com/business/energy/solarcity-stop... >>The PUC “has effectively shut down the rooftop-solar industry and taken the extraordinary step to punish over 12,000 existing solar customers, including schools, with exorbitant fees in what appears to be an attempt to protect the profits of the state’s largest utility. All three members of the PUC, who voted unanimously to change the rules, were appointed by Governor Sandoval.” >>Rive said: “Most disturbing is the PUC’s decision to retroactively sabotage existing solar customers’ investments by changing the rules on them. The Nevada government encouraged these people to go solar with financial incentives and pro-solar policies, and now the same government is punishing them for their decision with new costs they couldn’t have foreseen. These actions are certainly unethical, unprecedented, and possibly unlawful. While the rest of the country embraces a clean energy future, Nevada is moving backwards.”

seibelj 9y ago

Couldn't Tesla / SolarCity just said, "Hey, company didn't do well, sorry, here's 2 weeks severance"? Why do this whole "bad performance review" nonsense.

aslkdjaslkdj 9y ago
Because the stock price would drop and Tesla wants to do another round of funding (aka issue more stock) soon.
- skgoa 9y ago
  The stock price has dropped by $64 since the start of the week BTW. It was at $325 when I checked earlier today and came from a high of $389.
  - dtparr 9y ago
    That's not correct. $389 is its all-time high. It closed at ~$345 on Friday and opened ~$350 on Monday.
    - kunaalarya 9y ago
      it's literally $325 right now so what's not correct?
      - dtparr 9y ago
        skgoa said "The stock price has dropped by $64 since the start of the week BTW." It has dropped ~$25 since the start of the week. It's down $64 from its all-time high.
IanDrake 9y ago
I don’t know why you got down voted. That’s what Tesla should have done if they haven’t documented any performance problems. What they did is basically slander with real economic consequences to those fired and they should sue. Being fired with cause impacts their ability to collect unemployment, which most these people deserve. It also puts a bad mark on their employment history, unless they lie about how they where fired.

SubiculumCode 9y ago

I am pretty pro-union. However, in the case of Musk's enterprises, where there is this larger goal that is finally seeming to become possible, I am torn. I feel that anyone that works at these places should know and be a zealot for the Cause...but I suppose that Elon Musk probably should share his stakes with them a bit more, in that case. edit: I believe workers should be treated fairly, but I also want us to go to Mars. If 1 prevented 2, I would be torn. Why should this earn a negative vote?

adamsea 9y ago
The ends justify the means, eh?
- SubiculumCode 9y ago
  Sometimes, indeed yes. Not always. If you want to live in a black and white world go ahead. Best of luck to you. In any case, as I said, I am torn. That is why I advise that anyone that works for them be dedicated to the cause. Because while a lot of startups and the like profess to "change the world" Elon Musk's enterprises ARE changing the world to the kind of world I want to live in. Sometime visions need sacrifices. That said, Elon Musk should probably offer non-insubstantial stakes in the company to every worker.
  - dgritsko 9y ago
    Scott Alexander had a blog post recently discussing "moral offsets" and the distinction between axiology, morality, and law. It helped clarify my own mental framework and vocabulary for thinking through these sorts of "do the ends justify the means?" issues. I found it to be interesting food for thought and you may feel likewise, it's a very thought-provoking read (as is nearly everything on Scott's site). http://slatestarcodex.com/2017/08/28/contra-askell-on-moral-offsets/ http://slatestarcodex.com/2017/08/28/contra-askell-on-moral-...
    - SubiculumCode 9y ago
      Thanks for the link. Indeed a post for thought.

20years 9y ago

This doesn't really surprise me. A few years ago we had lead generation software that catered to the solar industry. We had some decent sized clients and it did really well for about 2 years. Once the tax credits started going away and the power companies started killing off their rebates, a lot of these solar companies were not able to survive. One of our larger clients who was heavily funded went bankrupt this year and many of the smaller/mid sized clients have folded within the last year too. It is risky basing too much of a business on tax credits and rebates.

jack6e 9y ago
I was thinking this myself. For all of Musk's braggadocio about not needing, and even being hurt by, subsidies, Tesla, whose profits only become more negative every quarter, has had its sales decimated in the countries that ended tax breaks for electric vehicles. With the specter of a major tax overhaul and massive spending cuts, a major recall, and still not enough strength to stand on its own, Musk has to be at least a little worried about Tesla's future and the futures of his other pet projects.
matt_wulfeck 9y ago
I’m surprised. At the rate PV has been falling these subsidies are probably negligible (federal rebate withstanding). I purchased PV because the cost with a 20-year loan comes out to be 13c kWh, meanwhile PG&E charges 29c kWh. And the loan interest is tax-deductible.
- sgc 9y ago
  What company did you use? I have received 3 quotes and none make much sense.
  - matt_wulfeck 9y ago
    Solarcity. Highly recommended.
    - sgc 9y ago

deleted 9y ago

[deleted]

montyboy_us 9y ago

SpaceX, Tesla, and SolarCity: ponzi schemes that have a little tech behind them and pull on our heartstrings.

vormalpg 9y ago
Compared to the pure software startups whose announcements are splashed all over the front pages of ycombinator, who are generally trying to spin old and boring ideas as grand innovation, I'd say there's a lot of tech behind these companies.
Bartweiss 9y ago
...can you give any context on how that applies to SpaceX? I think you're overstating the case for all three, because Tesla is a normal company that may or may not succeed, and SolarCity isn't a Ponzi scheme but simply a business dependent on regulatory decisions (like most every solar company). But the inclusion of SpaceX there is frankly baffling to me; it's a completely different business model only tied to the others by Musk's involvement. And their "little tech" has involved at least two major achievements no one else has ever come close to. Maybe they lose to Orbital or NASA stops outsourcing or something, but "sometimes companies fail" is a far cry from "Ponzi scheme".
ctdonath 9y ago
Ponzi schemes don't produce major technological advancement. SpaceX made reusable rockets a thing. Tesla made great cars with bleeding-edge EV technology. SolarCity made "solar roof" a viable & aesthetic product. All three are still thriving on a lot of tech advancement. Long-term success remains to be seen in three very difficult industries, but current performance is certainly not the facades of Ponzi schemes.
- ForHackernews 9y ago
  > SpaceX made reusable rockets a thing. The space shuttle was reusable. It just wasn't cost-effective. So far, SpaceX hasn't proven their resuable rocket is cost-effective either. > Tesla made great cars with bleeding-edge EV technology. Model X ranked dead last in reliability: https://www.cnet.com/roadshow/news/consumer-reports-survey-marks-tesla-model-x-as-least-reliable/ https://www.cnet.com/roadshow/news/consumer-reports-survey-m... Model S owners have also complained about reliability and build quality problems. I don't know much about SolarCity as a business, but the Tesla buyout has a lot of sketchy signs about it https://www.fool.com/investing/2017/10/18/solarcity-teslas-solar-boondoggle.aspx https://www.fool.com/investing/2017/10/18/solarcity-teslas-s... I don't necessarily think Musk's companies are literally "Ponzi schemes", but they are less impressive than the hype surrounding them, and they all rely heavily on government subsidies. I just wish HN would take the same critical eye to Musk that it does toward other business luminaries. It seems like far too many people are easily seduced by "Mars colony! Hyperloop! Rocket around the world!"

thejerz 9y ago

Has anyone else noticed a PR smear campaign against Tesla?

skybrian 9y ago
It can be explained by the usual press cycle. Once something becomes famous enough, they are automatically a news hook. Any surprising news about them (positive or negative) gets clicks.
vormalpg 9y ago
The only thing resembling a campaign one may notice is the breathless praise heaped on Elon Musk by his army of fanboys whenever Tesla or SpaceX are on the receiving end of criticism from the media. It's surpassed even a Steve Jobs tier of cultism.
glibgil 9y ago
Anyone else? You haven’t even noticed it. Unless, you want to cite some examples
VectorLock 9y ago
Blame the Russians. They seem to have the right intersection of effective propaganda machinery and oil interests.

11thEarlOfMar 9y ago

1,200 of 33,000 employees amounts to 3.6% of the work force. This level of action, 1 in 25 employees, gives managers an opportunity to release employees that looked good in the interview but did not meet expectations. Whether Tesla conducted this in a proper manner is open to debate and perhaps details will emerge if/when any former employees pursue Tesla in court. But any company needs to address the inevitable hiring mistakes and I don't see evidence that Tesla is doing any more than that.

Bartweiss 9y ago
> I don't see evidence that Tesla is doing any more than that If the lack of promised performance reviews is accurate, that's the obvious issue - it implies a labor force decision disguised as a performance decision. This is a pretty common move in e.g. game development, so it certainly isn't unthinkable. The point about total workforce size is well taken, though; this still seems like it could be as simple as "times are tough so we're cutting more stringently than we might otherwise".
- walshemj 9y ago
  Then the WARN act applies
  - deleted 9y ago
    [deleted]
- SRasch 9y ago
  Would you say 3,6 % is that stringent though? I remember GE under Welch fired 10 % of the lowest performers every year, that seemed kind of stringent. But Tesla is fast-hiring and acquiring, so seem to have a larger need to fix hiring-errors than GE. At the end of 2015 they had only 14,000 employees! In light of that, 3,6 % seems completely reasonable to me. Low, even. Concerning the performance review: would expect that after acquisition, SolarCity would adjust to Tesla's performance standards. So even if they were based on prior performance reviews, still seems like a reasonable action and level to me. As much as I try to squint, I'm having troubles seeing the smoking gun here.

msoad 9y ago

Call layoffs "firing" to look good in stock market and not have to pay severance packages... Elon is smart for sure

jcadam 9y ago
I dunno, my Tesla stock just took a big dump. Maybe I should sell.

smaili 9y ago

> SolarCity employees say they were surprised to be told they were fired for performance reasons, claiming Tesla had not conducted performance reviews since acquiring the solar energy business. Is it possible the performance reasons cited may have been in reference to performance in sales rather than performance in work? Otherwise it does seem odd to dismiss over employee performance if reviews has yet to be conducted by Tesla.

protomyth 9y ago

Does anyone know if the reason Tesla gave is interfering with the newly fired collecting unemployment? There are certain types of firing that would stop someone from being able to collect unemployment.

calvinbhai 9y ago

I’ve been with a bunch of smaller companies and have seen layoffs as well as been laid off before/during and after mergers. Not sure why this should be surprising in the case of Tesla + Solar City.

jonathankoren 9y ago
Because the purported reason for the firings don't add up. Usually in a merger, the combined company simply says what everyone already knows, there's redundancies.
mhermher 9y ago
It's mostly of note precisely because they are not layoffs according to Tesla. They were full on fired with cause. It's strange to say the least. What would trigger a mass firing like that. It's unusual.
- city41 9y ago
  I'm a SolarCity customer and absolutely despise them. Their customer service makes Comcast look like a saint. I can't help but cross my fingers this is a sign Tesla might be doing something about it. But I'm not getting too hopeful.
  - sgc 9y ago
    I had them come by for a quote. I never bothered to put their numbers in to compare to other offers because it was a terrible experience. I have no idea if they are even working on changing that, or just pivoting to industrial installations.

Animats 9y ago

At Solar City, sales must be down if they're closing entire offices.

sandstrom 9y ago
or redundant if they're using their Tesla stores to sell solar panels after the merger

pdimitar 9y ago

- It's not mass firing. It's not even 4% of the workforce. - So, employees were "surprised". As most people who are fired, ever, in any company and epoch. How is this news at all? - Recalling 11,000 units might not at all be connected with layoffs. Implying otherwise is a cheap yellow press journalism. - "Citing fears of retaliation from Tesla". Yeah, because Tesla definitely is known for pursuing people like they're some kind of a cold-war era vengeful spy agency. Sure. - Some layoffs came 2 weeks early. Wow. Scandalous! - Somebody made the mistake of over-stating how much personnel a new office is gonna have. Surely, this is news-worthy, right? - Exact number of people laid off is unknown so hey, I have a genius idea, let's listen to the former employees who are now negatively biased against the company. I mean, they can't be wrong, could they? And then the company tries to minimize the chance of former employees suing them. That's relatively normal if somewhat scummy, sadly it's a pretty classic state of affairs. Hardly exclusive to Tesla, though. This "tech reporter" would do well to work with paparazzi. It'll match her journalistic expertise.

gowld 9y ago
"Mass layoff" is defined by the United States Department of Labor as 50 or more workers laid off from the same company around the same time.
- pdimitar 9y ago
  Might be legally correct. Still gives the wrong impression because most people aren't lawyers. Should outline percentage, not absolute numbers, IMO.
  - tabeth 9y ago
    If the unemployment rate increased 3.6% tomorrow, I guess you wouldn't think it's a big deal, right? After all, it's not even 4%! The lack of sympathy people show these days. Sheesh.
    - pdimitar 9y ago
      It's one company out of hundreds of thousands. You did not address all of my criticisms of the article which are logically sound -- you only cherry-picked one emotional point.

Dirlewanger 9y ago

>Some of the firings came in big group employee meetings. WOW. Great place to work. Yet gives a shit when their stock is like 60% up YTD, right? /s

yuhong 9y ago

I wonder if the ideas of centralised layoffs based on performance reviews is even a good idea at all, especially for anything other than manual labor and the like.

xvikram 9y ago

While I do commend Musk's role in getting change within industries, it can't be argued that his biggest strength over the last decade has been only PR (and I mean only!). Do some digging and see how he chooses to release news bits, diversions etc and holds on to the mastermind billionaire ideal that people bestowed upon him. Any other company making false promises ("Auto"pilot), providing factually incorrect data (Model 3 "mass" production), mass firings ("performance" layoffs) would not survive in the world. Musk just dumbs down science to his cult and they swallow it up. Remind you of anyone else? (hmmmm... Trump - different audience of course but similar cult following characteristics). Tesla responding to lawsuits by former employees claiming they suffered racial discrimination and anti-LGBT threats (in The Guardian): “There is no company on earth with a better track record than Tesla.” Trump, March 2016: "Nobody knows more about trade than me." Don't think any other person/entity give out such absolute statements routinely.