Tesla shareholders on Thursday approved a pay package for CEO Elon Musk worth more than $45 billion while rejecting a pro-union measure that sought to prevent the company from interfering with worker organizing.
The shareholder vote on Musk’s pay package, the exact value of which fluctuates with the company’s share price, was a response to a January court ruling that voided the package because the Tesla board that had issued it had too many personal and financial ties to Musk. The CEO’s supporters expect the vote to strengthen his legal case for the money.
The unsuccessful pro-union proposal, which would have required the company to respect workers’ right to assemble, had been brought by Scandinavian investors acting in solidarity with Tesla mechanics in Sweden who’ve been on strike since October. Tesla pays less than other carmakers and Musk has been openly anti-union, even saying that he disagrees with the idea of unions.
The shareholder votes came after the company fired 14,000 workers—more than 10% of its global staff—in April and then made further cuts shortly thereafter. More Perfect Union, a nonprofit newsroom, drew attention to the layoffs in reacting to news of the shareholder votes.
Calling the pay package “outrageous,” the newsroom wrote on social media that “the vote allows Musk to further enrich himself, even as Tesla falters as a company and fires thousands of workers.”
BREAKING: Tesla shareholders just voted to give Elon Musk $56 billion.
— More Perfect Union (@MorePerfectUS) June 13, 2024
This outrageous pay package is over $55 billion more than the CEO of Google gets.
The vote allows Musk to further enrich himself, even as Tesla falters as a company and fires thousands of workers.
Other organizations also voiced their disapproval at the size of Musk’s pay package.
“It’s an order of magnitude more egregious than the most egregious ever dared to ask for,” Andrew Behar, CEO of As You Sow, a shareholder advocacy nonprofit, said of the pay package, The Christian Science Monitor reportedon Thursday.
The $45 billion pay package would come in the form of Tesla stock, taking Musk’s ownership stake in the company from about 13% to roughly 20.5%, The New York Timesreported.
“Working class people with pensions invested in Tesla could pay for the richest man on Earth to get even richer,” More Perfect Unionwrote on social media last week.
Musk’s contempt for unions is not just rhetorical: He is making a push in the courts to defang the National Labor Relations Board (NLRB), an effort that would “gut” fundamental New Deal workers’ rights legislation, according toThe Nation.
At a plant in Buffalo, Tesla management fired dozens of workers last year after one of them informed Musk of plans to organize a union. Last month, the NLRB filed a complaint against Tesla for interfering with union organizing at the Buffalo plant.
There’s a strong union tradition in Scandinavia, where many workers from other sectors have acted in solidarity with the striking mechanics. “Postal workers refused to deliver license plates for Tesla cars, dockers to unload Teslas from ships, and cleaners to scrub the firm’s showrooms,” The Economistreported.
Union leaders see the strike as a way of preserving the “Swedish Model” that has undergirded the country’s relative high quality of life and shared prosperity for decades. But organized labor is not yet as strong in emerging green industries, leading to concerns about low wages and meager benefits, the Timesreported.
Thursday’s shareholder votes for the pay package and against the pro-union proposal were both lopsided, a U.S. Securities and Exchange Commission filing showed, indicating strong support for Musk’s agenda.
In another Musk-influenced vote, shareholders agreed to move the Tesla’s corporate registration to from Delaware to Texas—an effort to avoid the Delaware court system, which Musk believes has treated the company unfairly. The pay package case will remain in Delaware courts.
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