Tesla sends some laid-off workers new severance offers after Elon Musk said some were 'incorrectly low' the first time

Tesla gave some workers a new severance offer with additional pay and health insurance. JOHN THYS / Getty

• Tesla sent some laid-off staff a new severance offer with additional pay and health insurance.
• The initial severance offer included two months pay and health insurance coverage, two workers said.
• Elon Musk has said he plants to cut more than 10% of Tesla’s workforce.

Some laid-off Tesla workers received new severance offers that included more money and longer coverage of benefits on Thursday night.

It continues a tumultuous week for Tesla workers, some of whom missed the layoff email before heading to work on Monday and only realized they were out of a job after a badge scan from security. Others told Business Insider they didn’t receive any severance information within the 48 hours Tesla had said to expect it.

Tesla CEO Elon Musk appeared to acknowledge the company had initially sent out faulty severance packages. On Wednesday, Musk sent a companywide email to current Tesla employees saying that “some severance packages are incorrectly low” and the company was working to correct the mistake.

Unlike early severance offers that were sent to some workers on Tuesday night, the new packages appear to vary between employees.

Two workers who’d initially received a severance offer for two months pay and two months of health insurance coverage were notified on Wednesday that their separation agreement had been canceled by Tesla and that an updated agreement would follow, the workers told BI. Within a few hours, the workers received severance offers with slightly higher pay, those workers said.

One worker said they got an extra month of COBRA health insurance coverage and an extra few thousand dollars thrown into their severance pay. Another worker said they were offered three months’ worth of severance pay and three months of paid COBRA coverage. Both workers were told they would no longer be employed by Tesla as of April 19.

Meanwhile, a third worker was told in their initial severance offer that was sent out on Wednesday night that they would be employed through June 14 in compliance with the Worker Adjustment and Retraining Notification Act, according to the document which was viewed by BI. The act requires companies that have more than 100 workers are required to provide 60 days of notice before a large-scale layoff. In addition to the 60-day notice period, the employee was told they’d receive two months of severance and two months of COBRA coverage that would be paid out after their employment ended in June.

Sixty days’ pay is the minimum that companies with more than 100 employees must give laid-off workers if there’s no 60-day notice period before mass job cuts, according to the Worker Adjustment and Retraining Notification Act. If an employer lays off an employee but allows them to maintain their employment status for 60 days it can also fulfill the WARN notice period.

The laid of employees are part of a mass layoff at Tesla. Musk told staff the electric-car maker was slashing more than 10% of its workforce on Sunday night, according to an internal memo viewed by BI.

A spokesperson for Tesla did not immediately respond to a request for comment.

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