SpaceX Wrongfully Fired Employees Who Called Elon Musk ‘Distraction And Embarrassment’: US Labor Agency

A new controversy has emerged involving SpaceX, the space exploration company led by Elon Musk. The U.S. labor agency, the National Labor Relations Board (NLRB), has alleged that the company unjustly terminated eight employees who publicly criticized Musk.

What Happened: The NLRB says that SpaceX transgressed federal labor laws by dismissing the employees who, in June 2022, circulated a letter criticizing Musk’s controversial tweets and deemed him a “distraction and embarrassment,” as per a Reuters report.

The letter asserted that Musk’s comments were not in line with the company’s policies concerning diversity and conduct within the workplace and called on SpaceX to condemn Musk’s actions. The NLRB complaint also suggests that SpaceX interrogated employees about the letter and threatened to dismiss those involved in similar activities.

Deborah Lawrence, a former employee, characterized SpaceX as fostering a “toxic culture”. Lawrence explained that the intention behind the open letter was concern for the mission and the people, not ill will.

The case is due to be heard by an administrative judge on Mar. 5 unless SpaceX decides to settle. If found culpable, SpaceX could face penalties and may be required to reinstate the employees with back pay.

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The allegations are not the first of their kind for companies under Musk’s leadership. Previous allegations of labor and employment law violations have been leveled against both Tesla Inc and Musk’s social media service X.

Why It Matters: This incident adds to the growing list of labor-related controversies involving Musk’s companies. In December last year, Tesla reportedly ceased issuing merit-based equity awards to its salaried employees, a change that left many questioning the company’s compensation strategy.

Tesla also recently challenged a former employee’s bankruptcy bid in a $425,000 legal battle following a lengthy dispute with Musk. The feud started when the employee exposed Tesla’s excessive wastage of raw materials, leading to his dismissal.

Musk’s approach to staff reduction has also been under scrutiny following his acquisition of Twitter in 2022. Musk laid off hundreds of Twitter employees to cut costs. The dismissal of 85% of Twitter’s staff sparked a massive backlash from the corporate world.

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