The California District Court rules that third party employees can use the Tesla job site to bring direct claims against Tesla for alleged violations of labor law – employment and human resources

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United States: The California District Court rules that third party employees can use the Tesla job site to bring direct claims against Tesla for alleged labor law violations

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In 2014, the US company Eisenmann was selected as the general contractor for a major construction project at a Tesla plant in Fremont, California. Eisenmann hired the Slovenian construction company Vuzem to provide labor for the project. Ex-Vuzem employees, all resident in Bosnia and Herzegovina, Slovenia or Croatia, have now accused Eisenmann and Tesla of multiple violations of federal and California labor laws.

All of the former workers’ lawsuits were dismissed as premature, with the exception of the solitary allegation that “Vuzem used coercive methods to gain the plaintiffs’ labor, that Eisenmann and Tesla benefited from a company that relied on the plaintiffs’ forced labor, and that.” Eisenmann and Tesla knew or should have known of the plaintiffs’ forced labor “in violation of 18 USC § 1595 (a).

Eisenmann and Tesla argued that the treatment of Vuzem employees was not directly related to any benefit for either company. The court defined the law broadly, ruling that the link between the labor violations and Tesla’s benefits need not be direct in order to establish liability. The court also ruled that plausors had plausibly alleged that Tesla and Eisenmann knew, or should have known, about the forced labor. Plaintiffs can pursue their remaining claims. The ruling has obvious consequences for the commercial construction industry, which, depending on the involvement of the client, actually holds both general contractors and project clients responsible. The court placed considerable emphasis on the fact that the Vuzem workers in California did not receive a building permit.

This case is just one of many that once again proves the value of due diligence and working with well-known contractors. You can follow the case at ND Cal, 5: 21-cv-02556-LHK.

The content of this article is intended to provide general guidance on the subject. Expert advice should be sought regarding your specific circumstances.

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