Tesla is being sued for alleged racial discrimination and harassment by a California regulator which claims the electric carmaker operates “a racially segregated workplace”.
The California Department of Fair Employment and Housing (DFEH) said it had received “hundreds of complaints” from workers at the Fremont factory.
Tesla called the lawsuit “misguided”.
It said it “strongly opposes all forms of discrimination and harassment” and will ask the court to pause the case.
Tesla said this would allow it to “take other steps to ensure that facts and evidence will be heard”.
Kevin Kish, director of the DFEH, said the agency “found evidence that Tesla’s Fremont factory is a racially segregated workplace where black workers are subjected to racial slurs and discriminated against in job assignments, discipline, pay and promotion”.
It claimed that employees would refer to areas where Black or African-American staff worked with racist historical names, such as “the plantation”.
The lawsuit, filed after an investigation by the agency, also alleged that one worker heard racial slurs “as often as 50-100 times a day”.
But Tesla claimed that over the past five years the DFEH has been asked by individuals to investigate the company on nearly 50 occasions
“On every single occasion, when the DFEH closed an investigation, it did not find misconduct against Tesla,” the firm said in a blog.
“It therefore strains credibility for the agency to now allege, after a three-year investigation, that systematic racial discrimination and harassment somehow existed at Tesla.”
It also said that the claims “focused on alleged misconduct by production associates at the Fremont factory that took place between 2015 and 2019”.
Last year, Tesla was ordered to pay $137m (£101m) in damages for failing to stop a black former worker at its Fremont factory from being abused.
Tesla has since appealed against the multi-million dollar settlement granted to former lift operator, Owen Diaz.
The company, which is led by chief executive Elon Musk, said in its blog that it is the “last remaining automobile manufacturer in California”, has “a majority-minority workforce” and provides well-paid jobs to 30,000 people.