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Tesla Motors Inc (TSLA) Denies Responsibility in Visa Violation Lawsuit

Tesla Motors Inc (TSLA) Factory Freemont, California

Tesla Motors Inc has a new state-of-the-art painting facility at the Fremont factory, of which it is proud of, since it has the capability of scaling up to 500,000 vehicles per year. However, this facility has also led the firm into trouble as an employee has dragged Tesla and several other defendants into a lawsuit.

Tesla Motors Inc (TSLA) Factory Freemont, California

What’s the case about?

Tesla is accused of using foreign workers in the construction of the paint shop, thus violating the terms of their B1/B2 visas, and underpaying them as well, as per a report from San Jose Mercury.

Gregor Lesnik – the employee who sued the firm – met with a severe accident while working on the paint shop project. He slipped on a loose tile and fell three stories down as a consequence of which he broke both legs, ribs and sustained a concussion.

Lesnik used to be an unemployed electrician back in 2014, when he lived in Velenje, Slovenia with his mother. His girlfriend was expecting their first child at that time, and he was in dire need of money. He came across an ad of a construction company located in Slovenia – ISM Vuzen.

The company provided teams of Eastern European workers to the Europe and the US for building manufacturing plant. Ford, Mercedes-Benz, Toyota, Saab and Volkswagen are few of its clients.

Eisenmann – a manufacturer of industrial systems based in Germany – was selected by Tesla Motors Inc in March 2015 for expanding the Fremont paint shop. This contract was valued at $100m, and was the most valuable one in the company’s history, claimed Eisenmann. The firm had to fill out the work force for the project, and soon it began hiring subcontractors.

It approached Vuzen for some of those workers. Lesnik applied for a US visa for which it got help from Vuzen and Eisenmann assisted in it. Robert Keller – based out of Chicago – was the US purchasing manager of the company and was listed as Lesnik’s US contact. Eisenmann said the company did not have any legal responsibility after Lesnik filed his lawsuit.

Tesla denies all claims

The company told the US immigration officials that Lesnik was a supervisor with specialized training who would be working with a BMW factory in South Carolina at a paint shop. Keller wrote a letter to INS, saying Lesnik was a “supervisor of electrical and mechanical installation. His assignment will involve multiple border entries but in no way adversely affect the employment of citizens of the United States.”

Rob Stoker, president of the Building and Construction Trades Council of Alameda County, said there was definitely something wrong with the picture. He claimed the high labor costs of a local company became the reason, in part, for it losing the bid on the Tesla project.

Lesnik and his fellow employees, who came to Tesla from Vuzen, received an hourly pay of $5 on average with no benefits. At times, they were required to work for 12 hours a day and all seven days of the week. He claimed that Tesla employees with whom he worked side by side were paid up to ten times as much.

However, Tesla Motors Inc denies any of this. “Tesla expects all its contractors and their subs … to comply with all applicable pay laws,” a spokesperson told the Mercury. But, a question that needs to be addresses is, how closely Tesla monitors the status of employees working for it

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Aman is MBA (Finance) with an experience on both marketing and Finance side. He has work as a Risk Analyst for AIR Worldwide, and is currently leading VeRa FinServ, a Financial Research firm. Favorite pastimes include watching science fiction movies, playing PC games and cricket.

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