Compliance » SpaceX Faces Legal Battle Over Alleged Worker Retaliation and Constitutional Concerns

SpaceX Faces Legal Battle Over Alleged Worker Retaliation and Constitutional Concerns


March 19, 2024

A case involving SpaceX and the National Labor Relations Board (NLRB) has stirred significant attention as it unfolds in Los Angeles. According to an article by Business Insurance Magazine, the dispute revolves around SpaceX’s alleged firing of eight engineers for criticizing CEO Elon Musk and accusing him of sexist behavior.

This accusation prompted SpaceX to file a lawsuit, claiming the NLRB’s internal proceedings violated the U.S. Constitution. Similar arguments have been raised by other companies facing union organizing campaigns, potentially impacting the NLRB’s ability to handle labor practice allegations.

The NLRB’s general counsel contends that SpaceX violated labor laws by terminating the engineers after they circulated a letter alleging sexist conduct by Musk and claiming the company tolerated discrimination against women. This allegation falls under the National Labor Relations Act, safeguarding workers’ rights to advocate for better working conditions collectively.

Additionally, the engineers have filed complaints with a California civil rights agency, accusing SpaceX of tolerating sex discrimination and retaliating against complaining workers. SpaceX has firmly denied any wrongdoing while challenging the NLRB’s functions in the lawsuit, filed in Texas federal court. Despite attempts to challenge jurisdiction, the case was transferred to California, and the company’s appeal was rejected by the 5th U.S. Circuit Court of Appeals.

The recent hearing before Administrative Law Judge Sharon Steckler focused on procedural matters, with discussions revolving around challenges to subpoenas. Further hearings are scheduled for May, with potential repercussions including reinstating workers and compensating them for losses if SpaceX is found at fault. The company’s legal representation has yet to respond to requests for comment.

SpaceX’s lawsuit asserts that the NLRB’s administrative process infringes upon its constitutional rights, specifically citing concerns over jury trials and limitations on the president’s removal of administrative judges and board members. The NLRB argues that similar removal protections have been upheld by the Supreme Court and that jury trial rights do not extend to federal labor law cases.

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