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HomeEV & BatteryTesla Contacted By Senators Regarding Its Arbitration Clauses

Tesla Contacted By Senators Regarding Its Arbitration Clauses

Seven US Democratic Senators have penned a letter to Tesla about the way it handles worker and customer complaints. Several of the politicians on the list have voiced their disagreements Tesla and Elon Musk in the past, but this is now moving to another level. Essentially, the group believes Tesla is using forced arbitration to hide information from the public.

It seems despite Tesla’s success, it’s almost constantly under fire by the media and many others. Perhaps some of it is actually because of the EV maker’s success, which was unexpected by many, not to mention its vocal CEO and its uniqueness.

At any rate, Tesla has been questioned before about its non-disclosure agreements, and this is a somewhat similar situation. A company can compel people to agree to enter into an arbitration clause or build it right into a contract. This way, if there’s an issue down the road, it will be addressed by an arbitrator instead of taken to court.

Arbitration clauses aren’t new. In fact, companies have been using them for years not only in hopes of avoiding the legal system, but also, in so doing, saving time and money. Tesla uses such clauses in contracts it drafts for its employees and its customers.

With an arbitration clause in place, Tesla could certainly limit the information that goes public. It could also sue former employees and make sure the media learns about all its accusations against them, and then turn to the agreement and force the person to settle the issue without ever going to court. This means the former employee can’t defend themself publically. Tesla has actually proceeded like this in the past.

With that said, Democratic Senators Richard Blumenthal, Edward J. Markey, Bernie Sanders, and Elizabeth Warren sent a letter to Tesla encouraging it to get rid of these arbitration clauses. A portion of the letter reads as follows, via Electrek:

“We are incredibly troubled by Tesla’s reported use of forced arbitration clauses in consumer and employee contracts. Such provisions deny consumers their right to bring cases in court and shield Tesla from public scrutiny and accountability.”

The letter goes on to point out that there are several reports suggesting that there’s a culture at Tesla that breeds harassment. It also emphasizes the fact that the Senators are bothered by the information escaping the public eye thanks to the agreements.

The group not only wants Tesla to stop using the agreements going forward, but also release previous information that was shielded by them. Neither Tesla nor Elon Musk has issued a public response related to the latter.

Check out the full letter below for all the details. Then, leave us your thoughts in the comment section below.

Tesla Forced Arbitration Letter
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