A coalition of U.S. labor unions and progressive advocacy organizations—including the American Federation of Teachers and MoveOn—has formally urged state officials overseeing public pension funds to oppose Tesla’s latest compensation proposal for CEO Elon Musk. They argue that such a massive pay award potentially jeopardizes the retirement security of teachers and other public employees.
In a letter shared exclusively with Reuters, the groups called on state financial officers to direct asset managers to reject the proposed payout and press Tesla for more independent board oversight.
This appeal arrives amid an ongoing legal saga: In January 2024, Delaware Chancellor Kathaleen McCormick voided Musk’s original 2018 compensation package—then valued at approximately $56 billion—citing serious board conflicts and calling it an “unfathomable” reward. This month, while the case is still under appeal, Tesla granted Musk an interim award of 96 million new shares, estimated to be worth about $29 billion.
Tesla’s board defended the move, highlighting that continuing Musk’s leadership is crucial for the company’s evolution from electric vehicle production into robotics and artificial intelligence.
At its annual shareholder meeting in June of last year, Tesla shareholders ratified the original payout and approved the company’s legal relocation to Texas. However, the court challenge remains unresolved, with the judge permitting further appeals.
The advocacy groups emphasized the need to oppose any new pay awards and urged shareholders to vote against board members seen as insufficiently independent of Musk. One advocate stressed: “Shareholders in Tesla shouldn’t be taking dilutions so that the wealthiest man in the world can be handed additional Tesla shares.”
Although Tesla has not yet released its proxy materials for the next annual meeting, the groups anticipate the compensation issue will feature prominently.
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