Wage and Hour Defense Blog

In Elijah Baer, et al. v. Tesla Motors, Inc., fifteen plaintiffs filed a putative class and Private Attorneys General Act (“PAGA”) representative action lawsuit against Tesla, Inc. (“Tesla”) alleging wage-hour violations of California law. Two of the plaintiffs were employed by Staffmark Investment LLC (“Staffmark”) – a non-party staffing agency – and assigned to work at Tesla for a period in 2020. The other plaintiffs were direct former or current employees of Tesla going back to 2017. After Tesla removed the action to federal court, it moved to compel arbitration.

The plaintiffs signed various arbitration agreements throughout their employment. From the fall of 2018 to May 2022, Tesla utilized a recruiting software called Averture. According to Tesla, Averture required applicants to create a secure online profile with their own personal information. Eight of the plaintiffs signed offer letters with Tesla through Averture containing an arbitration provision. These plaintiffs did not dispute that they signed, and Tesla countersigned, the offer letters.

At some point in 2022, Tesla stopped using Averture and started using a system called Inside Tesla. The security measures applicable to Averture were largely the same as those employed by Inside Tesla; however, applicants who were offered employment under Inside Tesla signed an offer letter and a standalone arbitration agreement. Four of the plaintiffs signed arbitration agreements through the Inside Tesla system.