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Tesla's Mass Firings Spread To SolarCity as Employees Say They Were Blindsided (cnbc.com) 272

Tesla has laid off over 200 employees from its SolarCity business for performance reasons, just over a week after firing hundreds more from its motor vehicle division. From a report: Employee dismissals at Tesla are continuing, according to six former and current employees, and have spread from its motor division to SolarCity offices across the U.S. Echoing reports from earlier this month, these 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. Earlier this month, Tesla began firing hundreds of employees after it announced a recall of 11,000 Model X SUVs. Tesla had already announced plans to lay off 205 SolarCity employees at its Roseville, California, office by the end of October this year. However, SolarCity employees across the country have been fired in the last two weeks -- not just in California, but also in Nevada, Arizona, Utah and beyond, according to these employees.
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Tesla's Mass Firings Spread To SolarCity as Employees Say They Were Blindsided

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  • by 110010001000 ( 697113 ) on Wednesday October 25, 2017 @02:41PM (#55431385) Homepage Journal
    I am one of those affected. Anyone have a $50,000 per year job for me in Silicon Valley in IT?
    • you'll need more than that in Silicon Valley, find out what the cost of living index is for there (or anyplace else you'd relocate) compared to where you were

      Claiming performance reasons without performance review or HR documentation of performance problems can be basis for lawsuit in many states.

      • I get a Christmas bonus too.
      • It's a joke. He's having a go at another poster who would frequently make comments about his $50k IT job in California, among other things. It's kind of a meme at this point.
      • Claiming performance reasons without performance review or HR documentation of performance problems can be basis for lawsuit in many states.

        I actually was wondering "why" Tesla and co was giving any reason for letting people go.

        Aren't most states "right to work" states? In those states you can quit or be terminated for no reason at all, and in most cases, no formal notice time has to be given, although 2 weeks is customary.

        • although 2 weeks is customary.

          Two weeks is customary for white collar workers working in offices in service industries, sure. Factory workers do not get that sort of thing, in most cases even if they're in a white collar job.

          Firing somebody "no cause" is the same as a lay-off; they can get unemployment, and it is the company who pays unemployment insurance so their rates go up.

          Obviously, you can fire people "for cause," as happened here, in every state and without any notice. Odd that the editors are so clueless that they would write "l

          • by rtb61 ( 674572 )

            Pretty obvious reasons why. New company, lots of hires, all got a little out of control (one bag egg at a higher level can hire a dozens of others) and Tesla was falling behind schedule and was looking for reasons why, well, they found them and let them go. Typical teething problems for a new company with seeking lots of new employees. They will get a lot of bad ones.

          • "for cause," as happened here

            Please. It's clear both incidents were mass lay-offs. In the Solar City division performance reviews hadn't even been carried out.

      • Claiming performance reasons without performance review or HR documentation of performance problems can be basis for lawsuit in many states.

        The claim is that Tesla hasn’t done any new performance reviews since they acquired Solar City. These folks may very well have been reviewed prior to the acquisition, in which case Tesla may be using those reviews as a basis for these firings... although at this point those reviews would be at least a year old, which would seem problematic if there hasn’t been any follow-up.

        • Tesla may be using those reviews as a basis for these firings

          Were they firings or layoffs? Big difference.

          Most tech companies do this thing every couple of years where they "realign their business" which is code for layoff any bottom feeders without having to do the paperwork and avoiding possible legal action related to a firing.

        • "Performance review" is a controversial management practice that most companies in the world do not do. It is not some sort of required step.

          Most companies do not add things up and then review them later in that way; they evaluate your performance whenever it comes up. If your numbers are chronically low and your supervisor notices, that might result in a notation in your file, and a conversation with you about your work practices, and you'll probably be asked to reaffirm your commitment to the job. The emp

          • by Kjella ( 173770 )

            The employee has no right to access to their file; they don't know if HR has something recorded about them, or not. It isn't "their" file, it is their employer's file that merely talks about them.

            If you're going to say "in the world" then I'll add "your jurisdiction may vary". At least here in Norway there's no "at will" work relationship, every termination needs a legitimate cause. Employers have been severely punished for terminating employees that are sick, pregnant, unionized or simply "bothersome" or disliked in some way. In broad terms the valid reasons either involves company performance requiring downsizing or relocation or employee performance regarding the performance of your job duties or

      • You can't fire someone for talking about starting an union.

      • by haruchai ( 17472 )

        Claiming performance reasons without performance review or HR documentation of performance problems can be basis for lawsuit in many states.

        I don't think that holds true in at-will employment states like California

    • Re: (Score:2, Insightful)

      by jonsmirl ( 114798 )

      I don't see why this is news. It is common for large companies to dump their bottom 5% of performers annually. Some even dump their bottom 10%. Of course, this is no fun if you are one of the ones impacted.

      • Re: (Score:3, Funny)

        So you are saying I am a bottom performer?
        • We believe you it was a cosplay party, we just think there are other important details.

          See also: The Rule of Goats.

      • Re:Happened to me (Score:5, Insightful)

        by swb ( 14022 ) on Wednesday October 25, 2017 @03:51PM (#55431873)

        Wasn't GE famous (or infamous) for doing this?

        I always wondered if it achieved anything truly productive. 5% is a big enough number that it would seem to have a pretty negative effect on the company -- termination processing, new hires, training, and the general chaos on teams/departments when there's a bunch of change.

        I can even see side effects, where people who do well in a job get management positions, become "low performers" and get canned. Sure, they've cut a low performer but they also lost someone good at their original job because, basically, they fired the original manager. Now they need two employees.

        I would also think it created a pretty toxic atmosphere and a lot of just people trying to meet goals versus actual productivity.

        • Re: (Score:3, Insightful)

          by Anonymous Coward

          In a very large corporation with a lot of dead weight morons, running such a program (properly) for a few years will clean up the mess and make the company more functional. However, such a program cannot be run in what is essential perpetuity as was the case with Jack Welch. You get to a point where every worker you have is good and you're not going to find better people consistently.

          There comes a point where if a company is constantly firing 5% of its employees, the people that really need to be fired are

        • There was a very good look at this effect a few years back. Mirosoft emulated GE's technique of laddering everyone and cutting the bottom rungs. The problem wasn't a specific layoff but rather how this rolling layoff poisoned the climate. People were focused on their own survival rather than any team goals. This is long but worth reading...

          https://www.vanityfair.com/new... [vanityfair.com]

        • by dj245 ( 732906 )

          Wasn't GE famous (or infamous) for doing this?

          I always wondered if it achieved anything truly productive. 5% is a big enough number that it would seem to have a pretty negative effect on the company -- termination processing, new hires, training, and the general chaos on teams/departments when there's a bunch of change.

          I can even see side effects, where people who do well in a job get management positions, become "low performers" and get canned. Sure, they've cut a low performer but they also lost someone good at their original job because, basically, they fired the original manager. Now they need two employees.

          I would also think it created a pretty toxic atmosphere and a lot of just people trying to meet goals versus actual productivity.

          Not only a toxic atmosphere for current employees, but one in which it is difficult to attract talent. GE is the 800 lb gorilla in my field of work, but they are infamous for layoffs. Recently in my field of work, they laid off a whole division, created a new subsidiary, and gave the laid off employees offers for about 1/2 of what they used to be making. I would have to be either desperate or given a very good offer to even consider working for them.

      • "I don't see why this is news. It is common for large companies to dump their bottom 5% of performers annually. Some even dump their bottom 10%. Of course, this is no fun if you are one of the ones impacted."

        Somebody seems to think it's 'news for nerds' I presume.

    • Were you trying to unionize? That was the claim made the other day.

    • Anyone have a $50,000 per year job for me in Silicon Valley in IT?

      If you are good I'm sure you can find a $50k / yr job. The problem is you'll need at least twice that to live here. Even at $100k a house is probably out of the question.

    • by PolygamousRanchKid ( 1290638 ) on Wednesday October 25, 2017 @03:23PM (#55431685)

      Anyone have a $50,000 per year job for me in Silicon Valley in IT?

      Does it have to be in IT . . . ? Otherwise $50,000 per year is what a good housekeeper in Silicon Valley expects.

      Your experience at Tesla will be a big plus, since potential employers will think that you are capable of washing their model S . . .

  • by fozzy1015 ( 264592 ) on Wednesday October 25, 2017 @02:50PM (#55431455)
    SolarCity was well on its way to bankruptcy. The only reason Musk bought SolarCity was to save his cousins and the SolarCity bonds he owned - at the expense of Tesla shareholders. And all it took was a lame presentation showing fake solar tiles to convince them.
    • by oic0 ( 1864384 ) on Wednesday October 25, 2017 @03:01PM (#55431529)
      Not saying he didn't, but if you are trying to save a faltering company, culling the workforce of non vital positions and underperforming employees is a start.
    • by 110010001000 ( 697113 ) on Wednesday October 25, 2017 @03:03PM (#55431535) Homepage Journal
      But surely Musk is going to get us all to Mars and build a colony there? He promised.
      • So, keep that in mind.
      • by AmiMoJo ( 196126 )

        He promised a fully automated drive from coast to coast by the end of this year. That's the closest promise that will be broken.

        • He promised a fully automated drive from coast to coast by the end of this year. That's the closest promise that will be broken.

          It's doable with current tech. Just hop on the I40* and time it so you hit any major cities (and I think they're relatively small anyway) and you can get almost all the way from coast to coast without ever leaving the interstate. The existing autopilot could pretty much do that route with a little care in timing.

          * I think I've remembered my interstates right

    • by King_TJ ( 85913 )

      I got the impression that Musk saw potential in SolarCity as aligning with his claims that electric cars are more environmentally-friendly. If you don't use alternative energy sources like solar to charge the cars up, you run into the issue where you're just drawing power from power plants often still burning coal or oil. Furthermore, if that's the usual scenario for charging stations, it dis-incentivizes adding them where they're most needed. (EG. Parking garages people use in big cities all day while at t

  • by E-Lad ( 1262 ) on Wednesday October 25, 2017 @02:52PM (#55431467)

    I cannot see Tesla's long view in their reasons here. They are a high-profile set of companies (Solar City, Tesla, Boring Co. and SpaceX among others) and this news has hit major outlets - not just niche industry rags. It would be in their best interest to get out in front of this and provide some detail; but they have not. The arbitrariness of the reasons given for firing employees en masse is now what is in the history books for them, and this will surly dissuade talent from desiring to work for a Musk company in the future. Uber is another big-name entity that is walking this same line due to the narrative around its work environment.

    • It is almost as if the executives are in it to make money and cash out or something and they aren't interested in what history books say about them.
    • The arbitrariness of the reasons given for firing employees en masse is now what is in the history books for them, and this will surly dissuade talent from desiring to work for a Musk company in the future.

      I'll turn over in my grave if my great grandson is reading about Elon Musk in a history book.

      • You can read about John Blunt in a history book. And if you don't know who John Blunt is, you should get a history book and read about him.

    • It looks like conserving cash and focusing energy to me... although my perspective might be biased.

      For SolarCity, that business needs laser focus if it is to grow in volume and generate profit. Residential rooftops are not where it will find the cash flow it needs. While I have no idea what positions were eliminated, I am guessing they can't afford to touch anything smaller than 500kW now, and fewer, larger installs would eliminate many positions.

      For Tesla, it looks to me like it is either union busting, p

      • Companies who pre-sell their whole output should not be presumed to have cash flow problems. ;)

        Also, firing low performing employees does not reduce production unless the remaining employees think the company is going to collapse. See above and pre-sales.

        Firing low performing employees often improves the morale of higher producing employees, especially if you follow it up with production bonuses!

        China is the biggest car market in the world, and Tesla is biggest electric car company in China with no close se

    • by hey! ( 33014 ) on Wednesday October 25, 2017 @04:35PM (#55432219) Homepage Journal

      It's interesting how few people are buying the "low performer" claims. The claims don't really make sense on their face; why would Tesla suddenly discover that its ranks are shot through with masses of people who need to be *immediately fired*? How could things have got so out of hand to require such a drastic immediate step? And how would those management culture problems suddenly be found in completely separate organizations that had been acquired a year ago?

      Here's my theory: Tesla has figured out that sometime in the not-quite-near future cash is going to get tight because of its portfolio of buck rogers projects. How far in the future? Well, far enough that an outsider wouldn't see it in the quarterly SEC filings but near enough that they can see it coming. In business cash is like your air supply. If I cut off your air supply you'll be in distress in one minute and unconscious in three. If a business runs out of liquidity to meet current demands it starts coming apart in a month and is unable to operate after a quarter. This can happen even if the business is making a profit; meeting immediate cash demands has surprisingly little to do with turning a profit.

      So what you do when you discover cash is going to be tight is look for cash outflows you can trim, and almost always payroll is going to be the biggest one. You start looking for people you can manage without. Low performers are an obvious choice, but if you've been doing your job all along you don't have a lot of those heads to chop. So you also look for people who simply pull down the larger salaries than others doing the same job. If my hypothesis is true, both Tesla's claims and the fired employees counterclaims could have a kernel of truth in them.

      But why not simply tell people that this is what they're doing? I think because a lot of Tesla's value is based on an aura of invincibility it has cultivated -- despite or perhaps even because of its past missteps, people believe in this company; they think it will succeed and they want it to succeed. But again if this is what's going on it's risky to in effect libel thousands of workers you've let go for financial reasons.

    • Your problem in understanding is that you drank some bad juice cocktail beverage and believed a bunch of hyperbole as fact, even though no misconduct happened and nobody gave you information that would suggest it did; all you heard were bare pejoratives, and you presumed there must be facts behind them.

      Also, please shut the fuck up about what the history books are going to write, OK McFly? You can't claim to know that, and any such argument would be based on facts you don't have access to.

  • by Nutria ( 679911 ) on Wednesday October 25, 2017 @03:11PM (#55431601)

    200 people out of (according to Wikipedia) 15,000 (that's 1.33%) is in no way shape or form a *mass* firing?

    • What they meant is that we were all fat.
    • Re: (Score:3, Insightful)

      by CanHasDIY ( 1672858 )

      "Mass" in this case just means "a whole bunch at one time," for example "mass mailing" refers to sending a bunch of pamphlets to a bunch of people all at once; It doesn't imply any particular percentage.

      FWIW, canning 200 people at once is a lot to do in one fell swoop, regardless of company size.

      • by Nutria ( 679911 )

        FWIW, canning 200 people at once is a lot to do in one fell swoop, regardless of company size.

        That's so wrong, it almost makes me want to weep for the future of Western civilization.

        • Naw, lets just fire him for low performance and let him do the weeping. Oh, wait, he's a volunteer. Darn.

      • regardless of company size.

        If your argument about scale is regardless of size, and with a fixed number of firings, then I don't even need to weigh the details to know your idea doesn't add up.

    • Maybe the picked folks based on their BMI? Gather the top 2% based on BMI and let hem go and I'll bet it's massive... Got to save some on that health plan..

      Ok. Ok.. It's a joke.... And I can make this joke because my BMI is too high..

    • Yeah, and a "mass shooting" in a stadium is nothing if they don't hit at least 10% of them.

    • by msauve ( 701917 )
      "Mass" as in "en masse" (i.e. as a group), not as in "massive."
      • by Nutria ( 679911 )

        Right. But that assumes it's 200 people from a specific subdivision. A few firings here and there, adding up to 200, isn't en masse.

        • by msauve ( 701917 )
          "A few firings here and there, adding up to 200, isn't en masse."

          Yes, it is, if done as part of a single action.
          • by Nutria ( 679911 )

            The language gods, were they to exist, would have smitten you by now.

            • by msauve ( 701917 )
              OK, if you prefer to use your understanding...

              "assumes it's 200 people from a specific subdivision."

              Everyone being laid off is part of the same subdivision (in the literal, not business, sense) of the company, the underperformers. Nothing in the meaning of "en masse" would even imply they would all have to be from, say, the accounting department. It's the firing of a specific group of people as a single action - i.e. "en masse."
  • by Anonymous Coward on Wednesday October 25, 2017 @03:18PM (#55431643)

    I have an acquaintance that worked for Solar City in the Roseville area, who had been told this was coming and was offered either a severance package or a job at Tesla in NV. This person isn't someone with a super unique skill set either and seemed to speak like it was common knowledge this was coming soon.

  • by djbckr ( 673156 ) on Wednesday October 25, 2017 @03:20PM (#55431663)
    Seriously, companies do this all the time and it doesn't cause any news at all. Just because it's Tesla (an interesting company from a nerd's point of view) does this make a splash. And really the firings weren't that big of a percentage of the work force

    This is just business as usual.
    • Despite the firings not being a significant percentage, as many have said, 200 is a significant number. The US Dept of Labor considers 50 or more people fired during a 30 day period a mass firing, they even have separate policies such as the WARN act for such cases:
      https://www.doleta.gov/program... [doleta.gov]
  • by ErichTheRed ( 39327 ) on Wednesday October 25, 2017 @04:53PM (#55432337)

    Everywhere I've worked, companies go out of their way to try to avoid firing people purely for performance. It's hard to stop vindictive individual managers from singling people out for...special attention...but I've never worked in mandatory-firing environments. This is most likely a cost-cutting measure. Everywhere I've been, people have been more than made aware of their poor performance before being let go...no one doesn't see it coming. Once you get put on a performance improvement plan, you're on notice that it's nearly time to leave.

    SolarCity might be trying to shed workers as the solar bubble dries up. We looked into solar systems for our house recently, and all of the companies are charging way too much for them, for any purchase option (loans, leases, outright purchase.) They're relying on the tax breaks to cloud the real cost of the equipment and maintenance, and (IMO) banking on the fact that most people don't know how their taxes are calculated. They just see they're getting a "huge" tax credit, resulting in a "huge" tax refund, and not taking the calculation to the next level and seeing how much the equipment cost is marked up. When the tax credit goes away, only a few of these companies are going to survive. The whole bubbly nature of this shows too -- you can tell that some of the local companies are these fly-by-night outfits with owners who jump from scheme to scheme and are just latching onto the latest way to make money.

    I like the idea of solar, but I'm not going to pay massively marked up rates for a system. Most people just shovel a shoebox full of receipts to their "accountant" and can't figure out their own taxes, or just punch numbers into TurboTax. I think the solar companies have run through these people and are having trouble selling/renting solar panels to the rest of the homeowning population.

  • by bettodavis ( 1782302 ) on Wednesday October 25, 2017 @04:59PM (#55432391)
    Until morale improves.

    It totally works.

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