Advocates say workers faced wage theft, other violations as Tesla's Austin factory was built

A workers' rights group is alleging contractors and subcontractors violated labor law and employment agreements during the construction of Tesla's $1.1 billion Austin manufacturing facility.

The construction workers are being represented by the Workers Defense Project, a nonprofit that supports low-wage workers in employment disputes. The organization is referring the complaints to the U.S. Labor Department and to the federal Occupational Safety and Health Administration, which is commonly known as OSHA.

The workers have alleged that multiple contractors and subcontractors violated their rights in numerous ways involving wage theft, workplace injuries, OSHA violations and the issuance of fraudulent OSHA certificates for training the workers say they never received.

The Workers Defense Project did not provide the names of the subcontractors who are accused, pending a Labor Department investigation. As a result, the American-Statesman was not able to reach out to the subcontractors for a response to the allegations.

At a Tuesday news conference, Workers Defense Project leaders said the allegations come from dozens of workers, some of whom are owed thousands of dollars. The nonprofit said there are potentially hundreds more workers who were affected.

At the news conference, people held signs in both English and Spanish that included phrases such as "Justice for the workers who built the Tesla gigafactory," "investiga la construccion de la tesla giga factory," "Tesla no es el futuro nuestra comunidad/Tesla is not the future of our community," and "Construction industry thrives on exploiting workers."

The complaints were filed with the federal agencies after the news conference, according to the Workers Defense Project.

Tesla's Austin-area manufacturing facility is shown in this file photo. A workers' rights group is alleging contractors and subcontractors violated labor law and employment agreements during its construction.
Tesla's Austin-area manufacturing facility is shown in this file photo. A workers' rights group is alleging contractors and subcontractors violated labor law and employment agreements during its construction.

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Hannah Alexander, an Austin staff attorney for the Workers Defense Project, said her group hopes the federal agencies will investigate, find violations have occurred and remedy the situation.

"We know that those federal agencies have staff that is capable and ready to investigate anything that comes their way. We're just really hoping for a thorough investigation and, hopefully, our workers get justice," Alexander said.

Alexander said the allegations are part of a larger pattern of violations of federal and state, labor and employment laws in the construction industry.

"We want to get the word out about this and invite other workers who've experienced similar things, both on this site and elsewhere to come forward," Alexander said.

Tesla CEO Elon Musk announced in July 2020 that the Tesla facility, which he calls a gigafactory, would be built in Travis County. Construction moved swiftly on the project, and the plant was able to start producing cars in late 2021. The facility has more 10 million square feet of factory space that includes both vehicle and battery manufacturing. There is also ongoing construction on the site as the facility continues to expand.

The allegations at the Tesla site include that a number of workers did not receive proper overtime pay rates of pay and several workers did not receive payment for work performed, according to a redacted filing the Worker's Defense Project made to the Labor Department's Wage and Hour Division.

Workers also alleged that they were told they would be paid a bonus if they worked Thursday through Sunday during the week of Thanksgiving 2021, but they did not receive the promised higher rate of pay.

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Alexander said the workers want to be paid what they were promised.

"I think what really agitated them or led them to stand up is that they were promised that they worked Thanksgiving 2021 and that they would receive the incentive pay. They had to work Thursday, Friday, Saturday and Sunday of Thanksgiving last year, all four days. And if they miss one day, one day, they didn't get this incentive of double their pay rate. A lot of workers made a decision of 'Hey, I'm going to sacrifice time with my family to do this to get this extra cash. It's worth it to me.' And then they didn't get it," Alexander said.

The OSHA complaint cites a case of a worker who allegedly was given false OSHA certifications for safety training that he never received. The complaint redacts the worker's last name, listing him only as Victor.

The Workers Defense Project said it expects more potential violations will be found by federal investigators.

"We really are relying on the Wage and Hour Division to investigate this because they can go in and look at the worksite more broadly or the employers more broadly versus just the couple dozen people that we're in touch with," Alexander said.

Tuesday morning, Greg Cesar, the newly elected member of the U.S. House for Texas District 35 where the factory is located, said he supports a full investigation by the Labor Department.

“These worker reports of wage theft and safety violations at the Tesla Gigafactory site must be taken seriously and fully investigated,” Casar said in a written statement. “Every Texan has the right to a safe workplace. Every Texan has the right to be paid what they are promised.”

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David Chincanchan, Workers Defense Project policy director, said worker advocacy groups raised concerns with Travis County officials before the Tesla project received approvals to begin work.

Chincanchan said the groups told the Travis County Commissioners Court that these kinds of workplace violations were likely to happen unless strong worker protections were put in place for the project.

The groups were pushing for protections under the Better Build Program, which sets standards for construction sites and requires independent monitoring.

Chincanchan said the program has been adopted for a number of developments, including several city of Austin projects.

The Better Builder Program "has been adopted by the community as the benchmark or the standards that we want to see in any construction or development to ensure that workers have that basic level of protection that our community wants to see them have," Chincanchan said.

An agreement between Tesla and Travis County did include some workers' protections. Those included the company ensuring all contractors and subcontractors provide a minimum wage of at least $15 per hour and required "good faith efforts" to hire workers from certain workforce development programs, including those certified by the Labor Department. It also called for an accident and injury prevention program with provisions for rest breaks and "a third party administrator to monitor all relevant aspects of the construction project and compliance," as well as OSHA training.

"These reports from workers are not to be taken lightly. The Texas construction industry essentially thrives on worker exploitation with massive corporations like Tesla that promise economic growth and job creation in exchange for tax cuts and incentives that we all pay for," Chincanchan said at Tuesday's news conference. "The reality is wage theft runs rampant on construction sites across the state, and workers lack basic protections, like the right to take water breaks. It's vulnerable communities and working people that suffer in the end."

The Workers Defense Project said the advocacy groups were seeking more independent monitoring of conditions on the site.

"Without that independent monitoring piece, we just can't be sure that those commitments are actually being done," Chincanchan said. "I don't know that it's a magic solution to everything, but it's something that has been proven to be life-saving. It's something that's been proven to be really effective and something that would have made a huge difference in this."

This article originally appeared on Austin American-Statesman: Advocates say workers' rights violated as Tesla's Austin factory was built