The Facts Behind Accusations Tesla 'Replaced' Laid-Off Staff with H-1B Visa Workers

As Elon Musk's influence on American politics grows, he's facing criticism over his support for the country's H-1B visa program, which allows U.S. companies to hire foreign workers in specialty fields. According to critics, he wants to maintain the program because his electric car company, Tesla, has used it to hire foreign-born workers who "replaced" American employees the company had laid off.

One December 2024 Reddit post read (archived): "Tesla replaced laid off US workers with foreign workers using H-1B visas that Musk want to increase."

While it's true Tesla laid off more than 6,600 workers in spring 2024 — around the same time labor statistics show the company filed about 1,300 H-1B visa applications — there is no solid evidence to prove, or deny, a definitive connection between the layoffs and the visa applications. 

According to financial publications like Bloomberg and Business Insider, the layoffs were likely a cost-cutting measure in light of decreasing demand for Tesla vehicles and increasing competition from other electric-car companies. The company's first-quarter delivery numbers reportedly fell below Wall Street estimates, and year-to-year sales declined for the first time since 2020. 

Additionally, Tesla had been using the H-1B visa program for years before layoffs. With that said, fall 2023 to fall 2024 — a period that covered the layoff announcement — was the highest year on record for new H-1B visa approvals and applications from Tesla, according to U.S. government data.

Snopes has reached out to Tesla and Musk for their responses to accusations that the company hired people with H-1B visas to "replace" employees who were laid off, and we have not received responses. We will update this article if that changes.

The rumor is impossible to confirm without information from Tesla. Specifically, the claim assumes without evidence that the layoffs affected U.S.-born workers and not H-1B visa workers, and that new H-1B visa workers were specifically hired after the layoff to fill the recently vacated positions. 

However, data from the Department of Labor shed light on Tesla's use of H-1B visas for employment. Between Oct. 1, 2023 and Sept. 30, 2024, a government fiscal year and the most recent data available, the Labor Department approved 2,067 applications submitted by Tesla for H-1B visas, which is the first step in obtaining the visa (that figure was calculated by viewing spreadsheets on the department's website). 

Between March and June 2024, the months surrounding the layoffs, Tesla submitted 1,269 applications for H-1B visas, or about 61% of the company's yearly total, the labor statistics show.

Musk's opinion of the H-1B program made headlines in late 2024 after he replied to a post on X — the social media platform that he owns — that called for the program's end. In his response, Musk threatened to "go to war" defending the H-1B visa program. With that position, some conservatives felt that Musk, who allied himself with U.S. President-elect Donald Trump throughout 2024, was breaking away from Trump's anti-immigration campaign promises. While Trump attempted to suspend the H-1B visa program in 2020, he told reporters less than a week after Musk's post about the program that he supported it.

The idea that employers are laying off U.S.-born workers and filling their jobs with employees on H-1B visas is not new. CBS News' "60 Minutes" covered the topic in 2017.

What Is an H-1B Visa?

According to U.S. Customs and Immigration Services, the H-1B visa allows foreign workers with at least a bachelor's degree (or equivalent) to come to the United States to work in positions requiring "theoretical and practical application of a body of highly specialized knowledge."

The program allows for a maximum of 65,000 new H-1B visas per year, with an additional 20,000 for applicants with a master's degree from a U.S. university. The visas last for three years but can be extended for up to six years.

Before a potential worker applies for an H-1B visa, however, an employer must submit documentation to the Labor Department and CIS for approval. Some information in those applications is publicly available.

How Many Tesla Workers Use H-1B Visas?

CIS compiles data for H-1B visa applications on a year-to-year basis. According to that data, Tesla had 1,767 workers on H-1B visas as of Sept. 30, 2024, the end of the government fiscal year. That total ranked 22nd among all companies with H-1B workers across the country. For comparison, Amazon, the company with the most, had 9,265.

CIS also categorizes applications in two ways: whether the applicant is applying for the first time or whether they have already received an H-1B visa and are seeking a continuation of the status. According to the data, 1,025 of Tesla's approved H-1B applications between Oct. 1, 2023, and Sept. 30, 2024, were the latter, which meant the applicants were already employed by Tesla. The other 742 workers were first-time applicants.

That was the highest number of Tesla's approved first-time applicants in any year and was more than double the second-highest: 336 in 2022. In other words, Tesla had significantly increased its use of the H-1B program in the 2024 fiscal year (742 approvals in one year is roughly 1.14% of the 65,000 visas offered nationwide).

When Did Tesla Apply for Those Visas?

Before an H-1B visa application goes to CIS, however, an employer must submit a form called the Labor Condition Application to the Labor Department. According to that agency's website, submitting the application is the second step (after determining a "prevailing wage," or amount to pay the in-question worker) in applying for the H-1B visa, as well as two other types of visas: the H-1B1 visa, which gives special allocations to citizens of Singapore and Chile, and the E-3 visa, which gives a special allocation to citizens of Australia. 

While Labor Condition Applications are required to obtain H-1B visas, an employer's number of those applications does not equal the number of H-1B workers hired. A company may opt not to hire an H-1B worker even though the Labor Department has approved an application.

Each financial quarter, the Labor Department publishes a list of all Labor Condition Applications submitted by companies and when. According to that list, the Labor Department approved 2,067 applications for H-1B visas from Tesla between Oct. 1, 2023, and Sept. 30, 2024, higher than totals from years prior. Of those, 322 were submitted in March, 67 in April (the month the layoff was publicly announced), 487 in May and 393 in June.

Before the layoffs, Tesla submitted 180 applications over the course of three months in 2023 (between October and December), 78 applications in January and 107 in February.

The Layoffs

Under a U.S. law called the WARN Act, employers must report large layoffs 60 days in advance of the layoff. In a reported internal memo obtained by Business Insider, Musk announced in April 2024 that Tesla was laying off more than 10% of its 140,000 workers. Without responses from Tesla or Musk, Snopes was unable to independently corroborate that reporting.

According to April 2024 documentation required under the WARN Act, Tesla laid off 2,688 workers in Texas and 3,332 in California (6,020 between both states). The company laid off 601 more employees in California the following month, bringing the total to 6,621 across the two months.