- The National Labor Relations Board ordered Tesla to make Elon Musk delete a tweet that was seen as threatening to labor organizers within the company.
- The federal board also ordered Tesla to reinstate a terminated employee, Richard Ortiz, who was a union advocate.
- The decision and order was in line with an administrative judge's ruling from 2019.
The National Labor Relations Board has decided that Tesla violated labor laws when it fired a union activist, and when CEO Elon Musk wrote on Twitter in 2018: "Nothing stopping Tesla team at our car plant from voting union. Could do so tmrw if they wanted. But why pay union dues & give up stock options for nothing?"
Among other things, the federal agency has directed Tesla to ask Musk to remove his offending tweet, and to offer a job back to the terminated employee, Richard Ortiz. Tesla must also compensate Ortiz for loss of earnings, benefits and adverse tax consequences that resulted from his firing.
The employee was part of an organizing campaign, "Fair Future at Tesla." At the time of the campaign, Tesla said its business should stay union-free. But Musk's public comments on his Twitter account, where he has tens of millions of followers, were seen as threatening. Tesla considers Elon Musk tweets to be official company communication, as disclosed in its financial filings.
Tesla will also have to revise a confidentiality agreement it gives to employees as a matter of course. The company previously told employees they were not allowed to speak with media without explicit written permission. However, national labor law generally "protects employees when they speak with the media about working conditions, labor disputes, or other terms and conditions of employment," the NLRB noted.
The board also directed Tesla to post notices nationwide, and hold a meeting (or series of meetings) at their main U.S. car plant in Fremont, to inform workers of their protected rights. At the meeting, Musk himself or a "board agent" in the presence of Musk, will have to read that notice to workers, along with security guards, managers and supervisors.
News of the decision was previously reported by Bloomberg, and confirmed by the United Auto Workers, which brought the suit. Tesla was not immediately available to comment.
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UAW Vice President and Director of the UAW Organizing Department, Cindy Estrada, said in a statement: "While we celebrate the justice in today's ruling, it nevertheless highlights the substantial flaws in US labor law. Here is a company that clearly broke the law and yet it is three years down the road before these workers achieved a modicum of justice."
Thursday's decision was largely in line with one from September 2019 by an administrative law judge, who had considered the complaint before. Tesla appealed that all the way to the full board.
Read the NLRB's full decision and order here.
CNBC's Michael Wayland contributed to this report.
