Sure, why not?
This is common practice in lots of pretty successful and pleasant countries. It's also common practice in systems like academic tenure. It's got its downsides, but so does at-will employment.
The primary reason I can think of to not do it is that it makes life tough for small employers like startups, who simply may not have the resources to pay out people for an extended termination period. So have it kick in once you hire N employees or make more than $M in revenue. (We do the same with plenty of other protections with social justice overtones, like anti-discrimination / anti-harassment laws.) Once you're Tesla-sized, though, you can afford to give people months of pay when laying them off, either as notice or as severance, giving them time to interview for another job and letting benefits like health insurance continue.
Wait, how did you make that determination?
In Musk's most recent letter to employees he said Tesla made a 4% profit in Q3 2018 and the forecast was lower for Q4 -- you think companies should be obligated to pay for employees they don't want or need? Just because they're a big a company and it'd be inconvenient for the employee?
I don't understand this POV at all, can you explain?
I am not sure how to explain this POV. I think it's good for society as a whole and good for people, and that's what I'm looking for in laws and government. What do you look for in laws?
I believe, similarly, that landlords should be obligated to rent out properties that they thought they wanted to rent out and then changed their minds on, just because it'd be inconvenient for the renter, for some generous period in which the renter can look for new housing. I don't believe that a landlord should be legally able to say "Good morning, I'm tired of renting, move out." My apartment is on a yearly lease, and either party needs to give about two months' notice if we want to not renew the lease for another year. That seems like a good thing, and rents are sky-high in my area and the market is very vibrant, so it's clearly not making landlords unwilling to participate in the market. Is this POV comprehensible to you?
In that same letter, Musk wrote, "we grew by 30% last year, which is more than we can support". I think that it is good for society and good for people and good for companies and good for investors for companies to be careful and intentional about hiring.
But then how is the problem not already being solved through contract law without needing anything separate?
And sometimes you don't want that, e.g. you may have to stay in a hotel for an indeterminate period of time because your house was damaged by a storm, but still want be able to check out whenever you want instead of having to give two months notice.
> That seems like a good thing, and rents are sky-high in my area and the market is very vibrant, so it's clearly not making landlords unwilling to participate in the market.
Rents being sky-high actually is a sign that landlords are unwilling to participate in the market, but it's more likely caused by restrictive zoning (causing new construction to be unwilling/unable to participate in the market) than some kind of lease requirements that may or may not exist there.
Contract law only really works for two people in similar bargaining positions. Good luck to you if you have poor credit history or are barely making ends meet and have to rent from whoever will take you.
If that's the only protection, then it's precisely the people who can't afford to be kicked out suddenly who won't have protection against it.
There are two lease contracts the landlord can offer you. One has a lower rent but allows them to evict you at any time without notice, the other has a higher rent and gives you two months notice. You can pass a law against the first one, but then you're left with the second one. And then the person barely making ends meat has to pay more in rent.
There are ways to do that, but some of them are better than others. For example, institute a UBI and the person barely making ends meat will be doing better and be able to afford the lease with the notice.
In general, the policies that work are the ones that don't try to micromanage anything or prohibit anything. If people are choosing something, assume it's not because they're idiots. Give them more choices, not fewer.
For example, a great way to help the poor is to have tuition-free community colleges, or encourage anything that lowers housing prices. But we don't really have that. Instead we subsidize student loan interest and mortgage interest, because that's more profitable to the banks who lobbied for it and the for-profit colleges and existing landowners it allows to inflate prices into the sky.
The problem with programs to help the poor is that the ones that actually do are expensive and don't pass, while the ones that pass will claim to but really do something else that most of the time makes things worse, completely by design from the perspective of the people who proposed it because they profit from it.
Better to have a UBI than subsidized loan interest, but better to have nothing than subsidized loan interest. Many "solutions" produce negative progress.
If you give them money they can use for anything, it doesn't increase the real cost of anything in particular, it only reduces the relative disparity between the rich and the poor.
I would rather a situation where people actually can't afford housing, which forces a solution, to one where we can pretend people are fine until they aren't. A similar argument is used against minimum wages, and yet the poor are almost universally better off in countries where minimum wages are high.
Which is why passing laws against things generally hurts the poor. The rich don't need to sleep under a bridge, so who does a law against it affect?
> I would rather a situation where people actually can't afford housing, which forces a solution, to one where we can pretend people are fine until they aren't.
Only it hasn't actually forced a solution. But rents sure are high now.
> A similar argument is used against minimum wages, and yet the poor are almost universally better off in countries where minimum wages are high.
The unemployed youth in France are not having a good time.
But more to the point, these kinds of laws tend to follow prosperity rather than the other way around.
That's not a reasonable conclusion. Laws against usury protect the poor. Laws against dangerous workplaces protect the poor. Hell, laws against slavery and debt prisons protect the poor.
> Only it hasn't actually forced a solution. But rents sure are high now.
They may be high, but it hasn't increased homelessness. Homelessness is barely above a ten year minimum, lower than during the GFC. [1]
That's sort of my point, at this stage people just barely get by, which is exactly the sort of situation legislators can ignore.
> The unemployed youth in France are not having a good time.
Cherry picking, but also not obviously related to the point. Are the unemployed youth in France unemployed due to minimum wage laws? Would they be better off if such laws weren't in place? Citation?
> But more to the point, these kinds of laws tend to follow prosperity rather than the other way around.
I'm not making an argument for maximising prosperity. A country with one quadrillionaire and everyone else broke would be the most prosperous in the world. I'm making an argument for protecting the poor.
[1] https://www.hudexchange.info/resources/documents/2018-AHAR-P..., page 10
Laws against usury subject the poor to illegal loan sharks who will break their kneecaps for non-payment rather than paying a high interest rate to a payday loan place that will merely ding their credit score and try to reclaim their loan money using the legal process.
> Laws against dangerous workplaces protect the poor.
Laws against dangerous workplaces protect shareholders from losing their investment when somebody gets hurt and sues the company. And give the company cover because they had their inspection done when somebody gets hurt regardless, so it's more difficult for the poor to sue them after an injury as long as their paperwork is in order.
Moreover, the compliance cost for companies that were not operating an unsafe workplace to begin with imposes overhead on small businesses and reduces competition, which can lower wages.
It's likely that they don't cause a major harm because there is no good reason to be operating an unsafe workplace regardless of whether there is a law against it, but they're still pretty close to breakeven.
> Hell, laws against slavery and debt prisons protect the poor.
Laws binding the legislature from instituting slavery or debt prisons, i.e. laws against certain laws, are not really canonical examples here.
> That's sort of my point, at this stage people just barely get by, which is exactly the sort of situation legislators can ignore.
We made things worse, but only by increasing inequality, not to the point of increasing homelessness. So we should make things even worse, that way when everything is really on fire someone will have to notice? What if we only get even more inequality and malaise?
> Are the unemployed youth in France unemployed due to minimum wage laws? Citation?
As part of a broad framework of high-overhead labor laws that discourage employers from hiring.
https://digitalcommons.uri.edu/cgi/viewcontent.cgi?article=1...
> I'm not making an argument for maximising prosperity. A country with one quadrillionaire and everyone else broke would be the most prosperous in the world. I'm making an argument for protecting the poor.
The best way to protect the poor is to get them out of poverty. Giving all the money to one quadrillionaire doesn't do that, but neither does binding everyone's hands or making it more expensive for anyone to start a small business.
Still, I found your counterexamples here dismissive but unconvincing. Loan sharks and kneecappings are precisely the things we need legislature against. Contract law by itself can't prevent desperate people from signing loan-shark contracts. "No good reason to be operating an unsafe workplace" is still enough reason to use children in coal mines until actual labor laws get passed. Anti-slavery laws are pretty plainly laws against powerful individuals enslaving weaker individuals--not sure what you mean with the "laws against laws" card there.
In laws and in government I look for measures to maximize my liberty. I think the purpose of government is to defend me from you and you from me.
I am ultimately responsible for my happiness. I don't think governments can make people happy and I don't think they should try
> I believe, similarly, that landlords should be obligated to rent out properties that they thought they wanted to rent out and then changed their minds on, just because it'd be inconvenient for the renter, for some generous period in which the renter can look for new housing. I don't believe that a landlord should be legally able to say "Good morning, I'm tired of renting, move out."
If landlords are in the business of doing things like this, I would like to start a company that doesn't treat it's customers like garbage and take money out of the pockets of such landlords
> I don't think governments can make people happy.
The government does positive actions (i.e. not merely preventing bad actors from doing bad stuff) for maintaining national parks.
I chose this example because the happiness of enjoying a national park is very direct, and the government's positive actions in maintaining these parks (e.g. controlling burns) is very uncontroversial.
So it turns out that the government can make people happy.
> I think the purpose of government is to defend me from you and you from me.
Does the government have a duty to defend its citizens from natural causes and from itself? If you agree with this, the there should be some guarantee by the government that the disabled veteran should be no less able to qualify for a job that someone not disabled can qualify for, with the difference in productivity compensated by the government.
Doesn’t the ADA(A) cover this? Doesn’t it specifically ensure that disability can’t be used for qualification?
>[...]with the difference in productivity compensated by the government.
Wouldn’t that undermine the fact that people with disabilities shouldn’t be evaluated based on their disability and ‘reasonable’ accommodations should be made?
What I'm saying is one step further, and more unreasonable: that if the disability disqualifies the person, then the government should compensate them for the marginal loss in wages that they could have earned from that job if they were not disabled (against a lower-paying job that they are still qualified for).
The ADA only prevents discrimination by employers against disabled people where the disability does not disqualify them from the job.
> Wouldn’t that undermine the fact that people with disabilities shouldn’t be evaluated based on their disability and ‘reasonable’ accommodations should be made?
This is a good general rule of thumb for the everyday treatment of the disabled, in terms of integrating with society. But I think this is insufficient to bring justice to the disabled. But you have a point and I guess the following may be a better way: with respect to disabilities arising from government service, there is a point in time when the government's actions have caused an individual to be disabled. Thus the disabled individual may be compensated for the amortized future loss in wages at one go; thereafter the law should not actively discriminate (positively/negatively) the disabled based on their disability. If a society should then decide to be more magnanimous, this may be done, too, to the naturally disabled, once they become of age. (not while they are too young, or this would create a perverse incentive)
Then people need to form guilds and demand this be standard practice in contracts.
Forcing this kind of thing through the middleman of a government seems like a great way to make a lot of people upset and not really get the progress desired.
Employees in the US tend not to prefer such agreements. It seems like most people prefer job mobility to guaranteed tenure.
people thought communism was good for society as a whole.. turns out it isn't
Key insight is that you have to consider the bigger picture and the incentives that your proposed rule creates.
> good for companies and good for investors for companies to be careful and intentional about hiring
how careful though? So careful that you rarely hire or fire anyone at all? So careful that it's impossible to disrupt an industry like Tesla is doing? Who should decide these things? Ever wonder why innovation mostly happens in the US rather then Western Europe?
I think there are sensible rules to regulate corps BUT I don't think these rules should be of the form of giving out freebies (which is what you want here). Regs for corps in dealing with individuals should be focused on creating a level playing field, such as laws against companies having too large a market share (because a person can almost never have a large market share), laws penalising unclear or confusing contracts, etc.
Wait, how do you determine this criterion? Take, for example, Trump's tariffs on Chinese manufactured goods. Retaliatory tariffs by China have made Tesla's cars far more expensive. That's not Tesla whimsically changing its mind about its employees, that's the financial and global politically situation rapidly changing.
You think Elon Musk is morally obligated to pay for employees Tesla can no longer afford because Trump pulled the rug out from under him?
The global financial / political / market situation can change for the better or for the worse, unrelated to the quality of the company's own work. Musk is exposed to the upside of these changes. We could have had, for instance, a president who cracked down firmly on fossil fuels and made electric cars much more competitive. (Or leave the US out; the rest of the world could have driven up the prices of fossil fuels.) He should be exposed, in turn, to the downside of these changes beyond the company's control. That's how investments and gambles and ventures work. (Alternatively, if we think it's good as a society for him not to be exposed to the downsides, we should find a productive means to insulate / insure him; transferring the risk onto low-level employees seems like a pretty unproductive approach IMO!)
Given that this employee was compensated significantly in bonuses and not in base pay ("it was okay that @Tesla didn't pay much because the bonuses were going to make up for it over time"), if he was compensated significantly in stock, then I think it's fine for him to be exposed to the risk because he's also exposed to reward if the company does well. But in such a case, a) they should not have canceled his existing stock grants and b) there should have been no need to lay him off immediately, they should have budgeted his base pay based on forecasts of possible not-great 2018s, and given him the option to continue working for base pay + weaker stock.
But if he was compensated in cash, I think Musk should be obligated - not "morally" obligated (I have strong opinions informed by my religious beliefs on moral employment agreements, but that's a different argument entirely), just obligated in the sense of logically necessary to produce robust outcomes that make effective use of the market and place appropriate incentives to maximize long-term productivity for society - to bear the risk of things going unexpectedly wrong in the market.
On the other hand, the downsides of at-will employment are basically solved by having unemployment insurance.
> So have it kick in once you hire N employees or make more than $M in revenue.
The trouble with this is well demonstrated by the instant case -- Tesla has lots of employees and revenue but also major operating costs. It's more likely that a large company can absorb x% in overhead than a small one, but that doesn't mean it's always the case. And it doesn't help anybody for 100% of the employees to lose their jobs instead of 7%.
And of course it is possible for any company to make short-sighted decisions that result in bankruptcy. Hiring too many people and being obligated to pay them is just one of several; if we're worried about companies going bankrupt and that being bad for ... employees? investors? society? ... then we should prevent them from making all kinds of bad decisions, not just from having to employ people.
The solution is for employees to negotiate their employment contracts. If you want X months of notice before being terminated, demand that it's in your contract before you agree to work there. But that will mean the employer will want to offer less compensation, because they're incurring a cost and it's always a quid pro quo. Putting the rules in the law instead of the contract only prevents you from choosing the other thing -- lots of people would rather get paid more than have more notice when being laid off.
Sounds like a great way to incentivise companies to discriminate against old people and people with preexisting conditions.
So at the end of the day it is all a compromise. I think pro worker compromises at the expense of companies staffing > 50 employees is definitely a positive.
With measurably deleterious effects on entrepreneurship. The solution to lay-offs isn’t hindering labour allocation. It’s socialising survival costs, e.g. through unemployment insurance, universal healthcare and subsistence guarantees.
But I don't have enough evidence to say that entrepreneurship is uncorrelated with improving society, so I'll just ask - anyone have recommended studies/articles/etc. arguing either for or against entrepreneurship or even research being a good measure of improvements to society / quality of life?
It's how you do them that is important and it revolves around treating people with dignity. Give them notice, allow them time to say goodbye to others, don't escort them out the building, don't make them sign NDAs etc.
Most companies do not have the spouses of former employees jump on Twitter to complain. So the mere fact it has happened means something went wrong from Tesla HR.
My point is, however, we can't know if that's what happened here.
Imagine for a second (and I'm NOT saying that's what happened here) her husband was terminated for sexual harassment. Should the company have given him 2 weeks?
The problem is we don't KNOW what happened, and for legal reasons Tesla won't respond (nor would any other company, probably).
A firing, layoff, termination -- without detailed, explicit evidence it's very hard to assign blame. This person has given us little detail so I think we should be cautious about how outsiders evaluate the outcome.
It's disappointing however to see this on the front page of HN as some sort of implicit acknowledgment that what Tesla did was wrong when we don't have a full, independent accounting of what happened.
Just put yourself in the shoes of a company or manager that's had to let someone go for legit reasons -- would you publicize them? We need more data but this tweetstorm doesn't really provide it, IMHO.
You don't know. I don't know. So why are we passing judgment?
If the tweetstorm was about why it's misguided corporate governance for Tesla to lay off 7% of its workforce, OK, let's have that debate.
But that's not what this thread discusses -- it specifically blames Tesla for laying off 1 person. But we can't possibly know the specifics of this individual's situation.
I don't know, you're right, but this is highly improbable.
But that's not what this thread discusses, it talks about the injustice of 1 person being laid off. And we can't possibly know the exact specifics of this individual's situation, so why are we passing judgment?
I agree that it's hard to judge those items without knowing the details of his offer letter, the terms of the bonuses, etc.
This is done because every once in a while, a laid-off employee will attempt sabotage or theft on the way out. A bad apple here and there ruins it for everyone.
I'm sure there is legalese behind the bonus that backs up Tesla's interpretation of both. More likely than not they would win in court too. But calling it something it isn't still strikes me as fraud.
Seems pretty fair.
That would be taking part most/all of his 2019 bonus if you're talking about OP though, not his 2018 one. Presuming at all reasonable (i.e. not deceptive) terminology.
At least in finance, nobody claws these back unless someone quit in bad faith.
However it's very _COMMON_ for company's to just fire someone who is disabled and hire someone else who can do the job without needing a babysitter.
Most people don't see a problem with this until it's their child; then they will be angry.
Lastly normally when a good company fires you go because of downsizing or problems that employee is given an exit bonus. Sure it might not be a lot; maybe a months salary.
Might not happen for everyone.
Lastly we need to be real about the problem of loosing your job and getting back on your feet. Those of you (like me) who get right back up and get a job the next day or next week... I congratulate you. It's hard.
Those of you who don't understand; you should try having over 100 different jobs before you are 23.
Really fucks with your self esteem.
One would presume that much of the current agitation in the body populace regardless of political stripe would be mollified by such an attempt. The life expectancy may even rise.
Beyond that, you are living beyond your means if you don't several months of rent and utility expenses saved up. She literally admits they were living beyond their means. That is poor judgement and it's their fault.
I am very, very sympathetic to their situation but I also don't think Tesla wronged them.
This is pretty much the situation in Europe. Very hard to lay people off and therefore companies don't hire as freely.
A lot of developed countries have it: its called employment insurance. Not sure about how it works in the US or if there is any there but that's pretty much what you're describing.
Its also prevalent, that you receive accelerated vesting in case the company terminates the worker(such as layoff or merger)
That forms part of an unfair dismissal case in Australia, yes. It is considered when evaluating how "harsh" a dismissal is.
First, being a disabled veteran does not preclude you from being laid off.
And as many others in this thread have pointed out, the "sign on bonus" she appears to reference apparently vests over 4 years, which is not that uncommon.
She says:
> "We’re shattered. Devasted. And fucking broke. @Tesla, shame on you. I know lay offs are a part of life, but you really took the low road and kicked your loyal employee in the balls when he was down."
Just to play Devil's Advocate for a minute, what if companies were prevented from firing or laying off employees because of the financial situation of the employee? Should the company be forced to keep paying redundant employees as some form of social justice or obligation?
Look -- this is not a judgment on her, her husband, or their family. Maybe what happened to this couple is a complete travesty, maybe Tesla is some horrible evil mega-corporation and they should feel ashamed over the situation.
However it's also possible her husband was in a department that was no longer needed or maybe even he underperformed his colleagues -- there's no way of knowing from this tweetstorm.
What I dislike is this presumption on HN that just because someone tweeted out his/her spouse got laid off by a tech giant that it's automatically some immediate miscarriage of justice.
Maybe it is. Maybe it isn't. There's no way of knowing from the evidence in front of us. I wish the mods of HN were more judicious in accepting these kind of one-sided screeds.