Tesla cuts over 10% of global workforce amid sales challenges and cost pressures

What’s happening at Tesla?

Tesla is eliminating more than 10 per cent of its global workforce as it navigates a slowdown in sales and an ongoing price war for electric vehicles (EVs).

“As we prepare the company for our next phase of growth, it is extremely important to look at every aspect of the company for cost reductions and increasing productivity,” CEO Elon Musk said in a memo to staff that was seen by Reuters.

The EV maker didn’t disclose the exact number of jobs affected by the reduction.

As of December 2023, Tesla reportedly employed more than 140,400 people globally.

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‘Incorrectly low’ severance

Just days after the layoffs were announced, Musk apologized for the inadequate severance packages that were provided to affected staff.

Some Tesla workers told Business Insider that they were only offered two months’ pay.

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Major layoffs continue

The job cuts at Tesla come amid a flurry of layoffs in 2024.

Big names, including Netflix, McKinsey & Co, EXL Service, Best Buy, Relic Entertainment, Ubisoft, Intel, Amazon, Telus, Canada Goose, Dell, Unilever, IBM, and TC Energy, have pulled out the axe as they continue to navigate challenging economic conditions.

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• Shell to lay off 20% of deals division, part of restructuring
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• Where are layoffs happening in Canada?

How does this impact Canadian employees?

It remains unclear if any Canadian employees at Tesla have been let go. According to the company’s LinkedIn page, it has more than 1,600 workers in the country.

If you’ve been laid off or are facing termination, here’s what you should know:

• You Are Likely Owed Severance: Employees at Tesla are entitled to full severance pay under Canadian employment law.
• What Severance Includes: Severance packages can cover salary, bonuses, commissions, benefits, and more.
• Rights Don’t Change: Even in times of corporate restructuring, your rights as an employee remain protected.

For a detailed overview of Tesla’s layoff history and severance entitlements, visit our Tesla Layoffs: Severance Pay for Employees guide.

Key severance facts for Tesla employees

If you’ve lost your job due to the closure, here’s what you need to know about severance in Canada:

• Severance Pay: Can be up to 24 months’ pay, depending on your role, age, length of service, and ability to find similar work.
• Deadlines: You have up to two years from your termination date to pursue a claim for severance.
• Misclassified Employees: Contractors may also be eligible for severance if misclassified as independent contractors.

Use our Severance Pay Calculator to estimate what you’re owed.

Steps to take if you’ve been laid off

1. Don’t Sign Anything Yet: Before accepting any severance offer, have it reviewed by an employment lawyer to ensure it’s fair.
2. Understand Your Rights: Learn about severance pay and employment standards through our Tesla Layoffs Guide.
3. Contact Us for Help: Book a consultation with our team for a detailed review of your severance package and employment contract.

Talk to an employment lawyer

If you’ve been affected by layoffs at Tesla, it’s critical to understand your rights and secure the compensation you’re owed. Contact us today for expert legal advice and a free consultation.

Our lawyers in Ontario, Alberta, and B.C. have successfully represented tens of thousands of non-unionized individuals. In addition to severance package negotiations, we can assist you on a broad range of employment matters, including:

Call 1-855-821-5900 or complete a quick form to get started.