Tesla HR Execs File Wrongful Termination and Retaliation Lawsuit

The six plaintiffs claim that Telsa fired or forced out HR staff who investigated and confirmed complaints from fired Tesla workers, most of whom are Black, of rampant workplace racism. According to the complaint, a federal court was told that they were fired or forced to resign for flagging “a toxic and retaliatory workplace environment… one beset with racism, sexism, cronyism, and outright physical violence.”

The 159-page federal lawsuit claims the HR staff were fired over bogus charges or forced to resign, and CE0 Elon Musk was personally involved in many of the hiring and firing decisions. According to the lawsuit, working conditions at Fremont have gone from bad to worse. It is billed as a racist and toxic place to work, and many former employees described the workplace as Jim Crow South; a place where Black employees and brown-skinned workers are besieged with constant racial abuse, stereotyping, and hostility—including with repeated use of the “N” word. Black Tesla employees reported “regularly encountering nooses on desks and other equipment as well as seeing the word ‘Nigger’ graffitied on walls, in bathroom stalls, elevators—even on new Tesla vehicles rolling off the production line. The lawsuit includes an image of a noose.

The Plaintiffs

Ozell Murray, the former Head of Security at the 22,000-person manufacturing plant and a former Fresno police officer, said he was given the boot for flagging safety issues that needed addressing, as reported by Law360. According to court documents, Murray claimed his team “routinely” seized drugs including cocaine and fentanyl, and regularly had to pull staff “off the manufacturing line” and send them home for being “alcohol-intoxicated and high on drugs.”

Tesla purportedly had a zero-tolerance policy for on-site drug and alcohol use, but Murray said that managers selectively addressed violations of this rule for biased reasons. He says in the complaint that “Many supervisors and managers were merely using the policy as a means to retaliate against their subordinates — and, in particular, when a line employee had turned down the supervisor or manager’s sexual advances…Or when the manager or supervisor wanted to retaliate against someone because of their race or ethnicity.” Murray also criticized Fremont’s public walk of shame: his security team had to escort HR personnel off the premises when they had been let go.

Murray complained to HR repeatedly in 2023, then an on-the-job injury (see “loophole, below) in mid-2024 caused him to take medical leave, which Fremont higher-ups saw as an opportunity to retaliate against him for speaking up about policy violations. Two weeks before his return date, Murray was informed that he was being investigated. By August 2024 he was forced on “stress leave” and he resigned a month later.

Rather than trying to resolve a toxic workplace, Tesla chose to punish the HR executives that investigated and confirmed the complaints. According to the complaint, plaintiffs Linda Peloquin, HR manager, and her onetime subordinate, Adam Chow, were targeted because they wanted a white employee fired who angrily asked a Black co-worker, “Do you want to hang by a tree?” (Hence, the noose image.)

Law360 reported that Chow was initially assigned the investigation, and Peloquin alleges she was fired in late 2023 for supporting his findings and termination recommendation. Chow was given the option in early 2024 of going on a performance improvement plan or resigning, and he chose the latter.

Tiara Paulino and Sharnique Martin, two more plaintiffs and former HR employees at Fremont, said they were forced out for sounding the alarm about retaliatory firings in the department, including Peloquin and Chow. In late 2023, the pair emailed concerns to their superiors. By February they too were terminated.

HR employee Gregory Vass, who is gay, got the boot because he expressed discomfort that Fremont’s top HR Manager Nicole Burgers had unilaterally placed him and other LGBTQ employees on an LBGTQ affinity group in mid-2023 without asking him, and that he was placed in the group just because he was gay. He voiced concerns to another HR manager, which resulted in his being investigated and subsequently fired – a regular pattern emerging.

“Loopholed”

The definition of loophole is “a failure to include something in an agreement or law, which allows someone to do something illegal or to avoid doing something.” And the loophole process at Tesla bypassed background checks. Due to Fremont’s toxic workplace, it has an extraordinarily high rate of employee turnover. Mainly due to intentional retaliation against employees that voiced complaints about racial slurs and discrimination, many workers either resigned or they were fired. On the flip side, the lawsuit explains that, in rare instances when wrongdoers were actually terminated, there was a dire need for workers due to the increased demand for vehicles. And Fremont’s HR team was having a hard time hiring and retaining employees to keep up with the workforce need due to rampant occurrence of racism and retaliation at the plant. So, the fired wrongdoers were simply “loopholed” back in through temp agencies. Tesla would re-hire someone via a temp agency so that that individual would not be subject to Tesla’s own internal background check process which would have immediately red-flagged that person.

In other words, the employee who had been previously victimized had to actually resume working with their attacker and tormentor. In fact, Ozell Murray took medical leave after he was attacked when he attempted to stop a loopholed employee—one who had been returned to work via a temp agency after being terminated for cause—after he attacked another worker.

This loophole practice was a major contributor to the lack of morale and toxicity at the Fremont facility.  The lawsuit accuses Tesla of sidestepping critical HR protocols (like background checks), especially for individuals with serious prior conduct issues.

Repeat Performance

Multiple lawsuits have accused the Fremont plant of similar allegations, including a race discrimination and harassment complaint last March involving nearly 6,000 African-American factory workers. In April 2025, Tesla settled a lawsuit filed by a Black employee who said her manager at Fremont used phrases such as “welcome to the slave house.”

This current lawsuit, Peloquin et al. v. Tesla Inc. et al., case number 3:25-cv-06690, asserts retaliation, wrongful termination, and failure to prevent discrimination. The plaintiffs are seeking compensatory damages, emotional distress damages, punitive damages, exemplary damages, along with attorneys’ fees and court costs.