Musk backtracks on job cuts, says Tesla salaried staff to be 'fairly flat'
Yesterday 3:38 p.m.
(Reuters) -Tesla Inc Chief Executive Elon Musk said on Saturday that the electric vehicle maker's total headcount will increase over the next 12 months, but the number of salaried staff should be little changed, backtracking from an email just two days ago saying that job cuts of 10% were needed.
© Reuters/MIKE BLAKEFILE PHOTO: Tesla service and sales center in Vista, California
"Total headcount will increase, but salaried should be fairly flat," Musk tweeted https://twitter.com/elonmusk/status/1533176789022957568 in a reply to an unverified Twitter account that made a "prediction" that Tesla's headcount would increase over the next 12 months.
Musk in an email to Tesla executives on Thursday, which was seen by Reuters on Friday, said he has a "super bad feeling" about the U.S. economy and needed to cut jobs by about 10%.
In another email to employees on Friday, Musk said Tesla would reduce salaried headcount by 10%, as it has become "overstaffed in many areas." But "hourly headcount will increase," he said.
Tesla's shares sank 9.2% on Friday on the news.
According to a Tesla U.S. regulatory filing, the company and its subsidiaries had almost 100,000 employees at the end of 2021.
Ahead of his emails on staffing levels, Musk on Wednesday in an email to Tesla employees issued an ultimatum to return to the office for a minimum of 40 hours a week. Failure to do so would be taken as a resignation, he wrote.
Musk on Thursday said Tesla's AI day has been pushed to Sept. 30, and said a prototype of Optimus, a humanoid robot that is a company priority, could be ready by then and could be launched next year
(Reporting by Rachna Dhanrajani in Bengaluru; Editing by Leslie Adler)
Brian Sozzi
·Anchor, Editor-at-Large
Fri, June 3, 2022,
U.S. Labor Secretary Marty Walsh says it's time for his new billionaire acquaintance Elon Musk to give him another phone call as the Tesla CEO eyes mass layoffs at the EV maker.
"I had a conversation with Mr. Musk about two months ago," Walsh told Yahoo Finance Live about potential layoffs at Tesla (video above). "I would love to follow back up with him about what more we can do as a government. Quite honestly, this is not just a government response. This is a business response as well [as a response to] where we are headed with the economy."
NEW YORK, NEW YORK - MAY 02: Elon Musk attends The 2022 Met Gala Celebrating "In America: An Anthology of Fashion" at The Metropolitan Museum of Art on May 02, 2022 in New York City. (Photo by Theo Wargo/WireImage)
In a new internal memo obtained by Reuters, Musk stated that Tesla would be pausing hiring and laying off 10% of the company's 100,000 global workforce as the world richest man had a "super bad feeling" about the economy.
"Certainly Elon Musk is a very smart person and he is looking at where he is in the economy, where the company is," Walsh said. "I am hopeful that won't happen out there. I am hopeful as we continue to move forward we will continue to see our economy get stronger."
Tesla stock fell nearly 9% on Friday as the news came as a surprise to the bulls with the automaker putting up a strong first quarter and noting strong order trends. The stock was the top trending ticker on the Yahoo Finance platform for the entire trading session.
The lines of communication have recently opened up between Musk and the Biden administration after a long stretch of iciness.
Musk gave Walsh a tour of Tesla's new Gigafactory on March 14, ten days after Walsh told Yahoo Finance Live that he welcomed a call from the EV titan.
"We had a good conversation," Walsh told Yahoo Finance Live in May when asked about the meeting, which marked the first public olive branch by the pro-union Biden administration to the famously anti-union Musk.
"I'd like hereby to invite UAW to hold a union vote at their convenience," Musk tweeted on March 3. "Tesla will do nothing to stop them."
Elon Musk Has an Original Idea to End Manager-Worker Divisions
Elon Musk doesn't like unions and does not hide it.
He is opposed to the creation of a union at Tesla, and will do anything to make unionization efforts fail.
His favorite argument is that the manufacturer of electric vehicles offers among the most attractive working conditions and wages and benefits.
His aversion to unions is one of the sources of tension with the Biden administration. President Joe Biden is a big supporter of the unions. He even hosted labor leaders after their April historic victory at Amazon, another anti-union stronghold.
"Chris Smalls is making good trouble and helping inspire a new movement of labor organizing across the country," the Democratic president posted on Twitter on May 11, referring to an Amazon Labor union organizer. "Let’s keep it going."
'Everyone Is a Worker'
But Musk has just put forward a very original idea which could well have the approval of the unions. The tech tycoon recommends abolishing the class system present in companies. Basically, Musk wants to end the famous distinction between managers and employees and everything that goes with it.
"There shouldn’t be this workers vs management two-class system," the serial entrepreneur wrote on Twitter on June 2. "Everyone is a worker."
Such an idea seems revolutionary, even Marxist, but Musk explains that at Tesla, the barriers were abolished between managers and employees. In Tesla factories, there is no special treatment for managers. Everyone is housed in the same boat, says the CEO.
"Everyone eats same food, uses same restrooms, etc – no executive chef or other ivory tower stuff," the tech tycoon said.
The system described by Musk somewhat resembles Toyotism, which is already found in tech companies where employees are supposed to have much more freedom to plan and execute their work. The workplace must be welcoming and friendly to retain employees.
In Toyotism, imported from Japanese companies, managers and executives participate in the execution tasks and the workers are called upon to give their opinion to improve the organization of work and productivity, often through so-called quality circles, for example.
Australian billionaire slams Elon Musk’s return to work order right as his $48 billion firm discloses a huge security flaw
Tristan Bove
Fri, June 3, 2022,
Australian tech billionaire Scott Farquhar started a war of words with Tesla CEO Elon Musk over the latter’s return-to-work policies. But a Twitter feud with Musk might need to wait, as Farquhar’s $48 billion software company is dealing with a serious hacker problem.
Musk, the world’s richest man, made waves earlier this week when a leaked email he sent to Tesla employees on Tuesday revealed how the CEO really feels about working from home.
“Remote work is no longer acceptable,” the subject of the email read, as Musk announced that white-collar Tesla employees who do not report to the office at least 40 hours a week can start looking for a new job.
Some tech companies, such as Farquhar’s Atlassian, appear to have taken that literally.
In a Twitter thread on June 1, Farquhar likened Musk’s proclamation to “something out of the 1950s,” and highlighted Atlassian’s move to fully embrace working from home as a “key for our continued growth.” He ended the thread with a link to Atlassian’s career page, inviting disgruntled Tesla employees to apply.
It wasn’t long before Musk responded to Farquhar’s provocation with a jab of his own: “The above set of tweets illustrate why recessions serve a vital economic cleansing function,” he replied.
Musk has a history of criticizing other billionaires on Twitter—having previously done so with Bill Gates and Jeff Bezos. But he didn’t even mention the current controversy surrounding Atlassian’s security protocols.
Atlassian, which was founded in 2002 and now competes directly with established developers including Microsoft and IBM, scaled new heights during the pandemic, briefly hitting a $100 billion market cap last year. Now valued around $48 billion, it recently issued an advisory warning on June 2 about a “critical severity” security flaw in its products, having detected multiple instances of “current active exploitation” by external parties.
The bug is affecting Atlassian Data Center and Server, a collaborative “groupwork” software commonly marketed to businesses, and one of the company’s best-selling products. Confluence has been designed to enable and facilitate remote working, with its homepage on the Atlassian website emphasizing it as a “remote-friendly team workspace.”
The company released a fix at 10 a.m. on Friday, less than 24 hours after the advisory as posted. But the recently-discovered bug impacts older versions of Confluence dating back to 2013, according to tech news outlet The Register.
Atlassian has urged users not to expose their Confluence software to the internet until a patch is released.
It isn’t the first time that weaknesses in Atlassian’s Confluence server have been considered vulnerable to hackers. Last year, the Australian Cyber Security Center issued an alert to Confluence users warning of a “serious vulnerability” in the product’s privacy protocols that could allow attackers to access the server and execute code remotely without authorization or authentication.
Confluence’s security issues exemplify one of the persistent problems associated with companies allowing employees to work from home indefinitely: cybersecurity concerns. It has been a headache for CEOs throughout the pandemic, and for executives like Musk—who reportedly has a habit of destroying his phone once a year out of security concerns—security issues with essential remote-work products like Confluence are just another reason to ask employees to return to the office.
That’s not out of the 1950s.
June 3, 2022: This article was updated to reflect that the bug affected Atlassian Data Center and Server, and what time the company announced they fixed the bug.
This story was originally featured on Fortune.com
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