Former SpaceX Employees Sue

[newpylong]

http://www.dailybreeze.com/social-affairs/20140807/spacex-sued-for-laying-off-hundreds-of-workers-without-proper-notice

SpaceX is going to have a hard time winning this one. They will need evidence that the terminated employees were previously made aware of sub par performance. Firm wide restructuring or losing the least performing 5% out of the blue is layoffs, any way you want to spin it.

They are a young company growing rapidly. Hopefully they take steps to prevent this from happening again.
 

[wolfpack]

Looks to be real.

"The case is Bobby R. Lee et al. v. Space Exploration Technologies Corp., case number BC552901, in the Superior Court of the State of California, County of Los Angeles."

http://www.law360.com/employment/articles/564591/spacex-slapped-with-wage-class-action-over-mass-layoff

I had checked WARN when the rumors first broke and didn't see anything w.r.t. SpaceX, which made me think either it wasn't very many folks or that what just happened would happen.

For those who don't know what WARN is -

http://www.edd.ca.gov/jobs_and_training/Layoff_Services_WARN.htm

You'll find Boeing and LockMart in there several times.

[manboy]

http://www.dailybreeze.com/social-affairs/20140807/spacex-sued-for-laying-off-hundreds-of-workers-without-proper-notice

SpaceX is going to have a hard time winning this one. They will need evidence that the terminated employees were previously made aware of sub par performance. Firm wide restructuring or losing the least performing 5% out of the blue is layoffs, any way you want to spin it.

They are a young company growing rapidly. Hopefully they take steps to prevent this from happening again.

Sounds like something SpaceX would want to settle out of court.

[AJW]

The WARN rules are very specific and I have seen companies avoid issues by skirting under the numbers by one or two employees, or by staggering the terminations to avoid hitting the 50-employee in 30 day limit.  Employees are also only counted if they have been employed over 6 months, so to determine a violation, you need records that are only available to the employer.  While an individual can hire a lawyer and sue, without access to the corporate HR records, they are unlikely to have actual proof that a violation has occurred. 

WARN is easy to avoid with just a little planning, and I would like to believe that Elon would hire an experienced HR team.  Still, I have seen HR representatives even in large corporations blunder with terminations and violate the California Labor Code, resulting in significant payments to those affected.

[Antares]

Moderately sized ball drop by SpaceX Legal and HR.  Gotta know basic labor laws, even if SpaceX was just lopping off the bottom 5% like Intel and JPL do.

[Kabloona]

So they'll pay out for the back pay/wages and move on. Not much to see here except, as has been said, a somewhat surprising fumble, and rather puzzling given Elon's experience operating in California.

[Coastal Ron]

http://www.dailybreeze.com/social-affairs/20140807/spacex-sued-for-laying-off-hundreds-of-workers-without-proper-notice

SpaceX is going to have a hard time winning this one. They will need evidence that the terminated employees were previously made aware of sub par performance.

Performance reviews take care of the documentation part, and from what I can tell the fired employee has to make the case that they were not fired.

Firm wide restructuring or losing the least performing 5% out of the blue is layoffs, any way you want to spin it.

SpaceX stated publicly it was less than 5%, and the article in question states "200 to 400 factory workers" which works out to about 1% of their 3,000 employees.  That is hardly a "massive" number if it was a layoff, and that appears to be wording that the Cal WARN Act uses to trigger it's requirements.

They are a young company growing rapidly. Hopefully they take steps to prevent this from happening again.

You are assuming what they did was wrong as opposed to a statistical "bump" in the number of people coming up for internal review that were on shaky review ground.  My guess is that if we knew when the people affected were hired we would see that they came mainly from the same era of hiring, and that it reflects the challenges SpaceX had at the time filling certain positions.

Granted my views are colored by having spent most of my career in management having to deal with performance reviews, but two employees out of "200 to 400 factory workers" doesn't seem like it's a massive problem for SpaceX - more of a law firm taking a chance to see if they can get something out of SpaceX regardless of the merits of the situation.

[kirghizstan]

SpaceX stated publicly it was less than 5%, and the article in question states "200 to 400 factory workers" which works out to about 1% of their 3,000 employees. 

more like 6-13%

[wolfpack]

even if SpaceX was just lopping off the bottom 5% like Intel and JPL do.

Could also be just a classic headcount goof. They may have staffed for an assumed flight rate at this point in time and they're just not there yet.

JPL culls the bottom 5%? Hard to believe NASA and Caltech would operate like Jack Welch!

[Jim]

JPL culls the bottom 5%? Hard to believe NASA and Caltech would operate like Jack Welch!

NASA has no say in Caltech personnel actions.

[mme]

From Law360

Law360, Los Angeles (August 06, 2014, 4:35 PM ET) -- Space Exploration Technologies Corp. is facing a putative class action in California court accusing it of not properly notifying its former employees of a mass layoff of up to roughly 400 workers in the state, and not paying them wages earned before termination.

The proposed class action, filed Monday, alleged that SpaceX ordered the mass layoffs of between 200 and 400 workers on or about July 21 without giving advance notice to the them, in violation of California's Worker Adjustment and Retraining Notification Act.

Maybe SpaceX blew it, but I don't think anyone outside of HR knows the exact number of people let go.

Filing this case as a class action means that it doesn't cost the two ex-employees anything.  I'm not accusing them of anything, they probably believe that over 5% of the work force was laid off, but I doubt they know for sure.  For the lawyers, it's minimal work to file the case and fairly early in discovery it will either be a slam dunk or dismissed.

Everyone can be operating in good faith and they could still lose.

[GORDAP]

Wait, I thought SpaceX maintained that this was not a layoff - that these employees were terminated for poor performance.  If this is the case, doesn't it make WARN's applicability N/A (since it looks to be only triggered by mass layoffs).

I'd think a huge evidentiary point in SpaceX's favor is that they continue to be in the middle of a hiring boom (not something you'd find typically associated with layoffs).

[Kabloona]

Wait, I thought SpaceX maintained that this was not a layoff - that these employees were terminated for poor performance.  If this is the case, doesn't it make WARN's applicability N/A (since it looks to be only triggered by mass layoffs).

That seems to be the case.

http://www.spacenews.com/article/launch-report/41428spacex-says-“headcount-reduction”-due-to-annual-reviews-not-layoffs

[Jason Sole]

Correct, there were NO layoffs.

[wolfpack]

Wait, I thought SpaceX maintained that this was not a layoff - that these employees were terminated for poor performance.  If this is the case, doesn't it make WARN's applicability N/A (since it looks to be only triggered by mass layoffs).

That's the tough part. Most companies are loathe to terminate with cause, because it requires a lot of paperwork to back it up in case of legal challenges.

[BobCarver]

Elon should just pack up and move SpaceX to Texas where employees know they have to perform or get sacked. He already has one branch in McGregor and one coming soon in Brownsville. How about one more in Austin to consolidate offices?

[docmordrid]

AIUI SpaceX is committed to Hawthorne until 2022/2023. Tax abatements, main building lease etc.

[brokndodge]

Elon should just pack up and move SpaceX to Texas where employees know they have to perform or get sacked. He already has one branch in McGregor and one coming soon in Brownsville. How about one more in Austin to consolidate offices?

CA has a lot of congressional votes too.  A few million in a lawsuit here and there is chump change compared to the votes in congress.

[mjcrsmith]

Working in a large corporation, RIF's happen.  It is common place.  It is never pleasant.  It is never easy.  Some will take the job loss and do nothing.  Some will feel they were wrongfully let go and seek out council. 

None of this is news and definitely not limited to SpaceX. 

Unfortuneately in our litigious society, corporations view this as a cost of doing buisness.  And, no doubt, will have an insurace policy to cover any settlements.

[Coastal Ron]

Wait, I thought SpaceX maintained that this was not a layoff - that these employees were terminated for poor performance.  If this is the case, doesn't it make WARN's applicability N/A (since it looks to be only triggered by mass layoffs).

That's the tough part. Most companies are loathe to terminate with cause, because it requires a lot of paperwork to back it up in case of legal challenges.

Musk appreciates good software solutions, so no doubt they are using a modern Human Resources Management System (HRMS), which makes it far easier for HR to monitor the progress of employees who have been put on notice for their performance.

For companies that like to follow procedures - and I think SpaceX has shown that with the success of their rockets - the termination process is just another procedure to follow in the life of a manager.  Not to say it's not without emotion, since no one likes firing someone that they hire, but for me at least I never let the paperwork process stop me from addressing employee issues.

My guess is that the law firm suing them is just doing it for exposure, not because it's an open and shut case.  Time will tell...

[deruch]

I seem to remember vague reports/rumors at the time that the firings/layoffs were spread out over many different divisions/locations.  Depending on how the people that lost their jobs were spread out between CA, TX, FL, etc. then even the 200-400 jobs number may not be relevant.  i.e. there may not have been 50 CA jobs lost, in which case whether they were layoffs or not could be moot in this case (though it might affect WARN violations in other states). 

[Lar]

This thread has a lot of wander potential. Please keep that in mind. We are not a labor relations site. Not sure we should be reposting comments from other sources on this topic... whether positive or negative...

... and I just removed a post as well as a reply critiquing the post. Brickbats to my PM inbox.

[Space Ghost 1962]

Perhaps this might help.

Perspective of Musk is as making quick decisions and deals with the consequences after the fact.

Perhaps he looked at reviews and said something like "I want these gone by end of day/week, get it done".

Perhaps it couldn't be done in a day/week. How do you push back on that?

Oops.

[Nomadd]

Working in a large corporation, RIF's happen.  It is common place.  It is never pleasant.  It is never easy.  Some will take the job loss and do nothing.  Some will feel they were wrongfully let go and seek out council. 

It's not a RIF when you hire more people than you let go.

[guckyfan]

Perhaps this might help.

Perspective of Musk is as making quick decisions and deals with the consequences after the fact.

Perhaps he looked at reviews and said something like "I want these gone by end of day/week, get it done".

Perhaps it couldn't be done in a day/week. How do you push back on that?

Oops.

Elon clearly listens to his employees. He does not make decisions like that and sticks to them if given a reason they are wrong.

[Prober]

Working in a large corporation, RIF's happen.  It is common place.  It is never pleasant.  It is never easy.  Some will take the job loss and do nothing.  Some will feel they were wrongfully let go and seek out council. 

It's not a RIF when you hire more people than you let go.

that kind of spin is up to a US court now to trash around

[newpylong]

http://www.dailybreeze.com/social-affairs/20140807/spacex-sued-for-laying-off-hundreds-of-workers-without-proper-notice

SpaceX is going to have a hard time winning this one. They will need evidence that the terminated employees were previously made aware of sub par performance.

Performance reviews take care of the documentation part, and from what I can tell the fired employee has to make the case that they were not fired.

Firm wide restructuring or losing the least performing 5% out of the blue is layoffs, any way you want to spin it.

SpaceX stated publicly it was less than 5%, and the article in question states "200 to 400 factory workers" which works out to about 1% of their 3,000 employees.  That is hardly a "massive" number if it was a layoff, and that appears to be wording that the Cal WARN Act uses to trigger it's requirements.

They are a young company growing rapidly. Hopefully they take steps to prevent this from happening again.

You are assuming what they did was wrong as opposed to a statistical "bump" in the number of people coming up for internal review that were on shaky review ground.  My guess is that if we knew when the people affected were hired we would see that they came mainly from the same era of hiring, and that it reflects the challenges SpaceX had at the time filling certain positions.

Granted my views are colored by having spent most of my career in management having to deal with performance reviews, but two employees out of "200 to 400 factory workers" doesn't seem like it's a massive problem for SpaceX - more of a law firm taking a chance to see if they can get something out of SpaceX regardless of the merits of the situation.

I think you need to review your math.

I would hate to work for the company you were at. I have never waited until a performance review to fire someone. Performance reviews are to review the last year and set goals for the next year.

Whether they were terminations or layoffs is for the court to decide but its obvious they have some problems if this many were cut at once. If it looks like a duck, swims like a duck, and quacks like a duck, then it probably is a duck.

[ArbitraryConstant]

Elon should just pack up and move SpaceX to Texas where employees know they have to perform or get sacked.

Plenty of California companies take that philosophy too, AFAICT they just give pay in lieu of notice and show you the door.

[clongton]

Employment loss means: (1) Your employment was terminated, but it doesn't include if you're fired "for cause, "like for disciplinary reasons, ...
Mass layoff: This is a reduction in force (RIF) that causes an employment loss at a single site during any 30-day period of at least: (1) 500 employees, or; (2) 50 to 499 workers if they make up at least 33% of the employer's workforce

http://labor-employment-law.lawyers.com/warn-act-may-help-if-youre-losing-your-job.html

WARN does not cover employees that are "fired" v.s. "laid off".  It also does not cover contract personnel (job shoppers). Does anyone know if these persons were fired or were job shoppers?

Also 400 employees does not rise to the 500 employee level to trigger a WARN. Because it is below the trigger number it does not constitute a "Mass Layoff" and therefore does not trigger the WARN requirements of 60 day notices.

ISTM that SpaceX threaded the needle on this one.

[butters]

The software industry is associated with a fair number of radical management theories, and while it's refreshing to see Elon Musk apply some of them to the manufacturing sector, I was hoping that he would leave the vitality curve (aka "rank-and-yank") behind. This was a strategy pioneered by Jack Welch at GE to be applied only to management. It's also commonly applied in the financial industry and in sales. But the software industry is famous for applying the vitality curve to engineers, usually with mixed results.

It appears to work best when the company is healthy and growing and has an abundance of job applicants. So if any company is in a position to test the vitality curve hypothesis on a technical workforce, SpaceX could possibly make it work at this stage in their corporate development. Most companies don't try it until they are past their prime and struggling to reinvent themselves.

[Coastal Ron]

I think you need to review your math.

Yes, as another pointed out it was worng ().  However SpaceX has stated that the number of people involved was less than 5%, so if their employee total is 3,000 then it would be less than 150 people at question here, not the 200-400 stated in the lawsuit (implying an employee total between 4,000-8,000 if 5%).  I adjusted the loose nut on my calculator so the math should be right this time...

I would hate to work for the company you were at. I have never waited until a performance review to fire someone. Performance reviews are to review the last year and set goals for the next year.

The most recent companies I am using for reference are well known technology/manufacturing companies that were in high demand to work for.  Not sure what type of companies you work for, but we typically had two review periods per year and managers were busy taking care of non-employee management issues in between the review periods.  Now sure there would be some employees that merited immediate attention (such as when I fired my first employee for lying about an accident), but the normal process would be that expectations would be set during performance reviews and then followed up at the next one unless otherwise agreed upon.

Whether they were terminations or layoffs is for the court to decide but its obvious they have some problems if this many were cut at once. If it looks like a duck, swims like a duck, and quacks like a duck, then it probably is a duck.

In fast growing technology companies sometimes you hire someone that is just not the right fit, so from what I can tell SpaceX management is being very good at making sure that they don't keep people around that aren't the right fit.  Is that wrong?  I hope you aren't advocating that once people are hired they are guaranteed lifetime employment regardless whether they are the right person for the job.

So the key thing to note here is that what SpaceX has said they have done is not unusual.  Maybe not the most common route, but certainly not unusual in company practice.  Which is why the supposed "duck" in this case looks like these were performance related actions, not a layoff.

[deltaV]

Employment loss means: (1) Your employment was terminated, but it doesn't include if you're fired "for cause, "like for disciplinary reasons, ...
Mass layoff: This is a reduction in force (RIF) that causes an employment loss at a single site during any 30-day period of at least: (1) 500 employees, or; (2) 50 to 499 workers if they make up at least 33% of the employer's workforce

http://labor-employment-law.lawyers.com/warn-act-may-help-if-youre-losing-your-job.html

WARN does not cover employees that are "fired" v.s. "laid off".  It also does not cover contract personnel (job shoppers). Does anyone know if these persons were fired or were job shoppers?

Also 400 employees does not rise to the 500 employee level to trigger a WARN. Because it is below the trigger number it does not constitute a "Mass Layoff" and therefore does not trigger the WARN requirements of 60 day notices.

ISTM that SpaceX threaded the needle on this one.

The California WARN act covers layoffs of 50 or more people regardless of percentage of workforce: http://www.edd.ca.gov/jobs_and_training/Layoff_Services_WARN.htm#GeneralProvisionsoftheFederalandCaliforniaWARNLaws .

[dragon44]

The software industry is associated with a fair number of radical management theories, and while it's refreshing to see Elon Musk apply some of them to the manufacturing sector, I was hoping that he would leave the vitality curve (aka "rank-and-yank") behind.

I think it's important to note that SpaceX has never said anything about a vitality curve. I think people jumped to that assumption when they saw "low performers" and a % attached to the firings. Rank-and-yank implies something like 1) Rank all employees from top to bottom 2) Fire the bottom 10%.

There is nothing to suggest the lowest n% had to be fired. It sounds more like annual reviews are complete, we have people that still aren't measuring up, let's fire them and hire replacements.

[GORDAP]

The California WARN act covers layoffs of 50 or more people regardless of percentage of workforce: http://www.edd.ca.gov/jobs_and_training/Layoff_Services_WARN.htm#GeneralProvisionsoftheFederalandCaliforniaWARNLaws .

DeltaV, it looks like you're misreading the law.  According to the link you provided, the '50 or more people regardless of percentage' provision only comes into effect if it is associated with a plant closing.  From the link:

"Plant closing. This is when an "employment site," or part of a site, is shut down and causes an "employment loss" for 50 or more employees during any 30-day period"

As far as we know, there was no plant closing associated with this event - that would have been much bigger news.

[deruch]

The California WARN act covers layoffs of 50 or more people regardless of percentage of workforce: http://www.edd.ca.gov/jobs_and_training/Layoff_Services_WARN.htm#GeneralProvisionsoftheFederalandCaliforniaWARNLaws .

DeltaV, it looks like you're misreading the law.  According to the link you provided, the '50 or more people regardless of percentage' provision only comes into effect if it is associated with a plant closing.  From the link:

"Plant closing. This is when an "employment site," or part of a site, is shut down and causes an "employment loss" for 50 or more employees during any 30-day period"

As far as we know, there was no plant closing associated with this event - that would have been much bigger news.

No.  The "50 employees" number isn't limited to only plant closings.  The sections that are relevant are CA Labor Code Section 1400 and 1401 (1402-1408 are about liability and associated issues), especially 1400.d & .f: 

CA Labor Code:
1400.  The definitions set forth in this section shall govern the construction and meaning of the terms used in this chapter: 
     (a) "Covered establishment" means any industrial or commercial facility or part thereof that employs, or has employed within the preceding 12 months, 75 or more persons.
     <snip>
     (c) "Layoff" means a separation from a position for lack of funds or lack of work.
     (d) "Mass layoff" means a layoff during any 30-day period of 50 or more employees at a covered establishment.
     (e) "Relocation" means the removal of all or substantially all of the industrial or commercial operations in a covered establishment to a different location 100 miles or more away.
     (f) "Termination" means the cessation or substantial cessation of industrial or commercial operations in a covered establishment. {NB: this is talking about "plant" operations termination not specific job employment's termination}
<snip>

1401.   (a) An employer may not order a mass layoff, relocation, or termination at a covered establishment unless, 60 days before the order takes effect,...
<snip>
(all emphasis added)

The 50 people is related to the "mass layoff" term.  The code requires the prior notice for both "mass layoffs" and "termination", which is what the code calls plant closings (per 1401.f).  Mainly, this case will be all about whether the job losses were actually layoffs or indeed firings.  At least, assuming that at least 50 of the people that lost their jobs were employed at one CA covered establishment or that they met the equivalent Federal statute, the focus will be on that.  There may also be some wrangling about whether enough of the jobs were at any one site to meet the reporting requirements.     

[CuddlyRocket]

^ Is SpaceX suffering from a lack of funds or lack of work? The fact that their overall numbers are going up would tend to suggest not. I suppose a part of SpaceX might suffer from lack of work if they over-produce because demand is a lot less than anticipated, but I haven't seen enough to judge whether that is the case.

[deruch]

^ Is SpaceX suffering from a lack of funds or lack of work? The fact that their overall numbers are going up would tend to suggest not. I suppose a part of SpaceX might suffer from lack of work if they over-produce because demand is a lot less than anticipated, but I haven't seen enough to judge whether that is the case.

While I don't have any personal knowledge of the state of SpaceX's financial health, "lack of funds" in this context means like soon unable to meet payroll (though, in certain circumstances, there are exemptions from WARN for companies that are in the process of searching for or securing financing).  I don't at all believe that is the case here and any further speculation on it requires theories that come very close to tinfoil hat brigade stuff.  "Lack of work" is about shortfalls in orders leading to being overstaffed, capturing large gains in productivity without corresponding gains in production levels that makes employees redundant, or lowering production, and hence payroll, as a cost cutting measure.  Without knowing what their jobs were, what numbers in various divisions, etc., any discussion is total hypothetical twaddle.  All we really know is that SpaceX has said that they weren't layoffs.  The plaintiffs in the case will have to prove otherwise.  It wouldn't be the first time that a company has done so.     

[Ludus]

I'd think SpaceX would find it hard to argue that terminating 50+ employees on a single date was not a layoff under the law. The claim that it was based on performance reviews in that context seems to be simply a selection criterion like seniority for a blanket decision to reduce the workforce (layoff everybody with a score below X on their performance review). As long as it's not lay off everybody over 40 or layoff everybody who's Muslim or some other prohibited category that's OK...but it doesn't let them off notification and severance requirements.

The principle here is that termination for cause means the employee actively violated a rule or did something clearly blameworthy, not that they simply didn't work up to expectations. The later is entirely arbitrary and accepting it would mean any employer could neatly sidestep all regulation of layoffs.

They might find it cheaper and easier to settle for paying the 60 days back wages and benefits.

This seems like a pretty technical HR/Labor law compliance issue rather than an indication there's any hidden problem at SpaceX.

[butters]

My limited understanding of labor laws is that it is tricky to legally fire employees for not being good enough at their jobs, so companies devise official policies and procedures for measuring performance and responding accordingly. They can't just be on the general lookout for under-performing employees to cull whenever it makes sense. It has to be a sort of game with rules that everybody signs acknowledging that they understand how to play. Otherwise it's not fair.

Many companies have these kinds of policies in place, and there's absolutely a way to implement this legally. The question is whether SpaceX documented their policy appropriately and jumped through all the other requisite hoops to fulfill their responsibilities under the law. The law cares primarily about the process. The outcome is secondary.

[wolfpack]

I think some of you are confusing layoffs and terminations. A layoff is WITHOUT CAUSE (business dried up, company decided to exit a market, etc). A termination is WITH CAUSE (low performance review, employee violated a workplace rule, etc). Terminations are always tougher because the company is making a definitive statement about an individual and it has to be true or else it's actionable. Thus you need documentation and lots of it.

So you don't layoff low performers. You fire them and cross your fingers that they don't sue. Which in this case they did. Beyond that, it's really an internal SpaceX issue and not any of our business.

[QuantumG]

So, what you're saying is that if 50 employees are fired, at the same time, for watching inappropriate content at work, that's a "layoff" in California? What is this, some sort of solidarity overrides employment handbook law?

If you're fired for cause, you weren't laid off. It's not a complex concept.

[abaddon]

So, what you're saying is that if 50 employees are fired, at the same time, for watching inappropriate content at work, that's a "layoff" in California? What is this, some sort of solidarity overrides employment handbook law?

If you're fired for cause, you weren't laid off. It's not a complex concept.

That would fall under "employee violated a workplace rule" and therefore "termination with cause", as explicitly noted in the post you are replying to...

[EDIT] Since you didn't quote a post, I'm assuming you are responding to the immediately previous post, but maybe you're referring to one of the other posts above?

[QuantumG]

That would fall under "employee violated a workplace rule" and therefore "termination with cause", as explicitly noted in the post you are replying to...

[EDIT] Since you didn't quote a post, I'm assuming you are responding to the immediately previous post, but maybe you're referring to one of the other posts above?

More agreeing with wolfpack. Some people seem to think that 50 employees getting fired at the same time is so amazing that it must be a layoff due to funding shortfalls or an economic downturn or.. something. Some companies just don't like carrying dead weight and like to remind their employees that performance is important. Don't like it? Don't work there.

[Galactic Penguin SST]

One small question: would there be such a long thread here had it been, say, Orbital that is the company involved?  (no offense to those at OSC  )

[edkyle99]

So, what you're saying is that if 50 employees are fired, at the same time, for watching inappropriate content at work, that's a "layoff" in California? What is this, some sort of solidarity overrides employment handbook law?

If you're fired for cause, you weren't laid off. It's not a complex concept.

This scenario only seems defensible to me if the company can show that ALL of the people it did not "fire" did not violate any similar work rules.  Seriously, what are the odds?

 - Ed Kyle

[Lar]

So, what you're saying is that if 50 employees are fired, at the same time, for watching inappropriate content at work, that's a "layoff" in California? What is this, some sort of solidarity overrides employment handbook law?

If you're fired for cause, you weren't laid off. It's not a complex concept.

This scenario only seems defensible to me if the company can show that ALL of the people it did not "fire" did not violate any similar work rules.  Seriously, what are the odds?

 - Ed Kyle

Failure to enforce a requirement does not waive the right to enforce the requirement later, typically. But IANALL (labor lawyer)

We're thrashing a bit. Unless new info is added from externally, perhaps best to see if your view has been stated, if not, state it, if so, abide?

[deltaV]

My wild guess is this lawsuit will come down to whether the terminated employees have skills in roughly the same areas as the people SpaceX hired in the months before and after the terminations. If SpaceX terminated a bunch of welders and hired a bunch of programmers that looks like a layoff---there was evidently a lack of work for the welders. If they terminated welders and hired new welders, or terminated from a wide variety of areas and hired in those same areas, it would be hard to support a claim it's a layoff.

[AJW]

A second suit has been filed.

'a former employee alleges that the rocket maker violated state labor laws by denying workers breaks and requiring them to work "off the clock."'

http://www.latimes.com/business/la-fi-tn-spacex-employee-lawsuit-20140812-story.html?track=rss&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+latimes%2Fbusiness+(L.A.+Times+-+Business)

[Lars_J]

Jeff Foust wrote a good summary of the two lawsuits here: http://www.newspacejournal.com/2014/08/13/spacex-facing-lawsuits-from-former-employees/

I find it interesting the the first lawsuit doesn't even have a solid count on the number of laid off people. 200-400? That wide range doesn't provide much confidence in the accuracy. Are the two individuals just filing based on internal or external rumors?!?

Nonetheless, we'll see what the courts decide, and/or if a settlement is reached. Employees should be treated fairly when laid off, even if 1 or 1000 were laid off at a time.

[newpylong]

Jeff Foust wrote a good summary of the two lawsuits here: http://www.newspacejournal.com/2014/08/13/spacex-facing-lawsuits-from-former-employees/

I find it interesting the the first lawsuit doesn't even have a solid count on the number of laid off people. 200-400? Are the two individuals just filing based on internal or external rumors?!? Nonetheless, we'll see what the courts decide, and/or if a settlement is reached.

200, 400 or anywhere in between does not effect the case.

Somehow they came to the conclusion enough were let go to trigger the WARN act in their opinion. I don't think it would be realistic for the class or their attorneys to have real numbers - it's not like SpaceX is going to turn that over without a court request.

[Jim]

A second suit has been filed.

'a former employee alleges that the rocket maker violated state labor laws by denying workers breaks and requiring them to work "off the clock."'

http://www.latimes.com/business/la-fi-tn-spacex-employee-lawsuit-20140812-story.html?track=rss&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+latimes%2Fbusiness+(L.A.+Times+-+Business)

The honeymoon is over

[Lars_J]

A second suit has been filed.

'a former employee alleges that the rocket maker violated state labor laws by denying workers breaks and requiring them to work "off the clock."'

http://www.latimes.com/business/la-fi-tn-spacex-employee-lawsuit-20140812-story.html?track=rss&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+latimes%2Fbusiness+(L.A.+Times+-+Business)

The honeymoon is over

It was over long ago. Now you are sounding just as reactionary as the "Gass was fired from ULA" folks.

[Borklund]

The honeymoon is over

Do you have any actual insight or are you just speculating on the media reports just like everyone else in here?

[Jim]

A second suit has been filed.

'a former employee alleges that the rocket maker violated state labor laws by denying workers breaks and requiring them to work "off the clock."'

http://www.latimes.com/business/la-fi-tn-spacex-employee-lawsuit-20140812-story.html?track=rss&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+latimes%2Fbusiness+(L.A.+Times+-+Business)

The honeymoon is over

It was over long ago. Now you are sounding just as reactionary as the "Gass was fired from ULA" folks.

No, this have been brewing for a long time. 

[Lars_J]

No, this have been brewing for a long time. 

Exactly - which is my point, that the honeymoon was over long ago. Grumblings from some SpaceX employees have percolated social media for a long time. A round of layoffs was inevitable at some point, they do occur in cycles in most corporations when the initial growth period comes to an end. So some sort of suit by some individuals was inevitable. It is no indication that the honeymoon is over *just now*.

[Jim]

Exactly - which is my point, that the honeymoon was over long ago. Grumblings from some SpaceX employees have percolated social media for a long time. A round of layoffs was inevitable at some point, they do occur in cycles in most corporations when the initial growth period comes to an end. So some sort of suit by some individuals was inevitable. It is no indication that the honeymoon is over *just now*.

My post was about the work hours suit and not the layoff.  Every place has grumblings and people quitting/resigning over work hours, few have suits on it.

[RonM]

There is an article on CNN about the lawsuits.

http://money.cnn.com/2014/08/13/news/companies/spacex-lawsuits/index.html?hpt=hp_t2

[Elmar Moelzer]

There is an article on CNN about the lawsuits.

http://money.cnn.com/2014/08/13/news/companies/spacex-lawsuits/index.html?hpt=hp_t2

Funny that if SpaceX does a successful launch, CNN wont bother reporting it, but a lawsuit makes the headlines...

[strangequark]

There is an article on CNN about the lawsuits.

http://money.cnn.com/2014/08/13/news/companies/spacex-lawsuits/index.html?hpt=hp_t2

Funny that if SpaceX does a successful launch, CNN wont bother reporting it, but a lawsuit makes the headlines...

http://www.cnn.com/2014/05/29/us/spacex-new-spacecraft/
http://www.cnn.com/2014/04/18/us/spacex-dragon-launch/
http://www.cnn.com/2013/12/03/tech/innovation/spacex-launch/

SpaceX doesn't exactly suffer from a lack of positive media coverage...

[abaddon]

My post was about the work hours suit and not the layoff.  Every place has grumblings and people quitting/resigning over work hours, few have suits on it.

I can't comment on the rocket industry, but in the tech industry these things are not uncommon.

[Redcoat22]

This entire thread is so much to do about nothing.  Wage and hour lawsuits are quite common with disgruntled employees and trying to use it as a sounding board for impending corporate doom at SpaceX is laughable.  People fall over themselves trying to work at SpaceX because its the kind of demanding place that make people feel like they have a high purpose.  Believe it or not, money isn't the biggest motivator in life. 

Even if this suit prevails (which would be surprising given that there is an HR department) the penalty would hardly disrupt the grand picture here.  Move along.


The surprising truth about what motivates us

[Coastal Ron]

Every place has grumblings and people quitting/resigning over work hours, few have suits on it.

I don't think you have visibility into the number of suits there really are since that implies that SpaceX represents the "norm" with regards to visibility, and we know that SpaceX is far more visible than the norm (for good and bad).

In my career the suits that I've been aware of from a management standpoint never made the national news, and only some made the local news.  I do agree though that every place has grumblings and people quitting/resigning over work hours, and this suit will turn on whether the person was hourly or salary - if hourly then they deserve to be paid, and if salary then it's less clear (and likely not).

[edkyle99]

One reason these suits against SpaceX are creating headlines is likely the fact that SpaceX itself filed a big newsy lawsuit against the U.S. government a few months back. 

 - Ed Kyle

[Coastal Ron]

One reason these suits against SpaceX are creating headlines is likely the fact that SpaceX itself filed a big newsy lawsuit against the U.S. government a few months back. 

No doubt.  And just the fact that SpaceX is publicity savvy for the positive stuff also means that they are newsworthy for everything else too.  It's just the nature of how the news works, especially in our hyper-connected way these days.  Kind of like the old saying, "live by the sword, die by the sword".

[Robotbeat]

It's part of life at SpaceX. It sucks, but they have made far more progress in about the same time as Blue Origin and Virgin Galactic, two companies (esp. VG) with a better work/life balance. For most of the workers at SpaceX, they no doubt think it's worth it.

[wolfpack]

The honeymoon is over

Between whom?

[wolfpack]

One reason these suits against SpaceX are creating headlines is likely the fact that SpaceX itself filed a big newsy lawsuit against the U.S. government a few months back. 

 - Ed Kyle

Big newsy to us. Wouldn't move the needle for most folks.

[mlindner]

Exactly - which is my point, that the honeymoon was over long ago. Grumblings from some SpaceX employees have percolated social media for a long time. A round of layoffs was inevitable at some point, they do occur in cycles in most corporations when the initial growth period comes to an end. So some sort of suit by some individuals was inevitable. It is no indication that the honeymoon is over *just now*.

My post was about the work hours suit and not the layoff.  Every place has grumblings and people quitting/resigning over work hours, few have suits on it.

Welcome to agile work environments? This is really common at software companies. People dissing their employers and quitting and being pressed too hard. Maybe some folk from slow paced work environments find offense?

[llanitedave]

The honeymoon is over

Between whom?

Between Jim and SpaceX, of course.  We know how infatuated he's been with them up until now...

[meekGee]

A second suit has been filed.

'a former employee alleges that the rocket maker violated state labor laws by denying workers breaks and requiring them to work "off the clock."'

http://www.latimes.com/business/la-fi-tn-spacex-employee-lawsuit-20140812-story.html?track=rss&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+latimes%2Fbusiness+(L.A.+Times+-+Business)

The honeymoon is over

It was over long ago. Now you are sounding just as reactionary as the "Gass was fired from ULA" folks.

No, this have been brewing for a long time.

Hiring is a really difficult task, and you're bound to pick up some of the wrong people.  I'm surprised this hasn't happened before.

But "honeymoon is over" implies there's some fall out between SpaceX management and the workforce in general.  Instead, we have some people moaning they didn't get enough breaks.  What exactly does it mean?  Exactly nothing.

"This has been brewing for some time now" implies knowledge of the state of mind of the disgruntled employees.  About that, I am not surprised.

[cleonard]

In California you have to pay overtime to the hourly people.  Same for the break rules.  Salaried engineers are a different story.  I'm one of those California engineers and I've put in a lot of time.  I don't average some of the crazy numbers that have been thrown around for SpaceX.

There are some special rules here for some IT/engineering job titles where you have to pay overtime below a compensation threshold.

I wonder how many of the terminated salaried employees were canned due to not putting in enough hours.

[A_M_Swallow]

Has SpaceX done previous firings following performance reviews?
If not this implies a change in management style.

[Jim]

But "honeymoon is over" implies there's some fall out between SpaceX management and the workforce in general.  Instead, we have some people moaning they didn't get enough breaks.  What exactly does it mean?  Exactly nothing.

"This has been brewing for some time now" implies knowledge of the state of mind of the disgruntled employees.  About that, I am not surprised.

"honeymoon is over" is that it has gone to court

"This has been brewing for some time now" is that there have been other group resignations

[Jim]

Welcome to agile work environments? This is really common at software companies. People dissing their employers and quitting and being pressed too hard. Maybe some folk from slow paced work environments find offense?

Its nothing new for aerospace.  Did it 20 years ago at Spacehab, but I got compensated for my overtime.
SOP for military organizations.

[Elmar Moelzer]

Welcome to agile work environments? This is really common at software companies.

Its nothing compared to how badly many game developers treat their employees. People were asked to work 18 hour days without overtime and then were fired after completion so they would not be eligible for bonuses when the game shipped...

[notsorandom]

Its simple really, everyone has to follow the law. An employer no matter how cool or revolutionary cannot deny their workers breaks and make them work without pay. If the allegations of these lawsuits are true than SpaceX is going to learn an expensive lesson. However it may ultimately be for the better if it changes the work culture at SpaceX to something more sustainable. A good number of young professionals will eventually want to start families. If a company makes them choose between them or a family then they will loose a good number of talented people. Also a burned out employee is a less productive employee. SpaceX should not be in the position having their competitors snapping up their employees.

[meekGee]

But "honeymoon is over" implies there's some fall out between SpaceX management and the workforce in general.  Instead, we have some people moaning they didn't get enough breaks.  What exactly does it mean?  Exactly nothing.

"This has been brewing for some time now" implies knowledge of the state of mind of the disgruntled employees.  About that, I am not surprised.

"honeymoon is over" is that it has gone to court

"This has been brewing for some time now" is that there have been other group resignations

A bit over-dramatic no?   How many employees are suing?

"In one suit Joseph A. Smith, alleges that SpaceX broke California state wage and hour laws by failing to provide required meal and rest periods."

More accurately: the honeymoon between Joseph A. Smith (Is this even his real name?) and SpaceX is over.

--

I know about the other group resignation.  Have there been more?  Since if not, you're talking about "resignations" where there has only been a single other one. 

More accurately: Some guys resigned together a while back.  Then last week, some guys were terminated, and at least one guy is unhappy about the work hours, food, and not getting enough breaks.   What exactly is brewing?

--

Your summary lines read like headlines from "US Weekly".

[Coastal Ron]

Its simple really, everyone has to follow the law. An employer no matter how cool or revolutionary cannot deny their workers breaks and make them work without pay.

I agree that companies need to follow the law, but the issue with the second lawsuit may have more to do with a supervisor that is not good at management as opposed to the entire management of SpaceX.  That still doesn't make it right, but may be more an indication of growing pains more than anything else.

I worked for a technology company that grew rapidly - when hired I was in the low 3,000's for employee ID, and a year later we were up to over 5,000, adding 100 people a week.  You have to create your own management in that situation, and at our company we pushed as many people through management training classes as we could.  But not everyone is a born manager, so issues can come up.  That could be the situation with SpaceX.

However it may ultimately be for the better if it changes the work culture at SpaceX to something more sustainable. A good number of young professionals will eventually want to start families.

Well that is the natural progression, and certainly SpaceX is growing into a different company than they were 10 years ago, and even 4 years ago.  But that won't stop the constant pressure of innovation in them, because as Andy Grove is famous for saying, "only the paranoid survive", plus they have a CEO with a vision that is easy to understand (i.e. make humanity multi-planetary).  So from a growth perspective SpaceX is not unique, and the company I referenced earlier was still catering dinners for late working engineers 15 years after it started up, and I've heard the same from other companies too.

If you have a company that generates excitement for what they are doing then you'll be able to attract workers that enjoy challenges.  There is even an article about this in the Houston Press:

Space Flight: Increasingly, Gifted Individuals are Opting for the Private Sector Over NASA

SpaceX should not be in the position having their competitors snapping up their employees.

If you don't want to be challenged in a big way at work, then sure, you'll leave SpaceX to work on some normal project that will never make the news.  But if you want to be part of the disruption in space transportation, you'll gladly stay.

My $0.02

EDIT/MeekGee: Fixed URL

[Jim]

There have been other instances. 

The point is that it is become mainstream public. 

But continue to make excuses and ignore reality.

[veblen]

I'm kind of surprised that SpaceX can't or isn't interested in compliance with labour laws. Because that is a simple problem compared to some of the other constraints that they will be bumping up against.

[meekGee]

There have been other instances. 

The point is that it is become mainstream public. 

But continue to make excuses and ignore reality.

Mainstream public?  Why should it even be a secret?

"Guy sues employer and seeks class action".  Fine.  SpaceX will either win or lose the lawsuit, or settle.  Fine too.

I don't see any evidence of a wider issue between SpaceX and its workforce. 

The only "excuse" I'm making is that when you're growing at the rate SpaceX is growing, there's going to be HR issues once every so often.  Hardly the end of the world.

[Jim]

I don't see any evidence of a wider issue between SpaceX and its workforce. 

Hard to see much from a knothole

[meekGee]

I don't see any evidence of a wider issue between SpaceX and its workforce. 

Hard to see much from a knothole

I can't think of many better observation posts that a knothole....

 

[Lar]

I'm kind of surprised that SpaceX can't or isn't interested in compliance with labour laws. Because that is a simple problem compared to some of the other constraints that they will be bumping up against.

My view:  I think you may be overgeneralizing. That there were some lawsuits making allegations doesn't mean that the allegations are true, and even if they are true that doesn't mean it's a corporate wide culture thing, it could be someone not following policy.

Changing hats: There seems to be a lot of heat and smoke and not a lot of light in this thread. Can we try to raise the level of discussion in this thread please? Please? Everyone think before you post a snappy comeback or one liner... thanks.

[Elmar Moelzer]

I just find it funny that people are perfectly fine with this, if it affects a large percentage of the employees of a game studio (and you don't hear anything about lawsuits there), but make a lot of noise about SpaceX which probably was A LOT milder than EA and co.

[edkyle99]

There have been other instances. 

The point is that it is become mainstream public. 

What we would all really like to know is whether this is just a management issue for which SpaceX will be able to make adjustments and improvements, or whether SpaceX is purposely trying to run a space-age sweatshop.

 - Ed Kyle

[Lars_J]

...or whether SpaceX is purposely trying to run a space-age sweatshop.

  Really, Ed? I know I shouldn't be surprised...

[Jim]

How much longer before the IAM comes in.

[symbios]

Ed I notice that you do not bring up the alternative, that the allegations are not true.

It is interesting how people condemn them before they have had their day in court.

I do not know if it is true or not and will wait for the courts to have a say.

[Chris Bergin]

This thread is low quality, bumping down good quality threads.

I'm locking it.