UPDATE: The construction workers who walked off the gigafactory site Monday have returned to work, according to the Las Vegas Review-Journal.

However, union leaders have said the matter is far from resolved. Russell James, District 16 business development specialist for the Building and Construction Trades Council of Northern Nevada, told the Review-Journal, "We are planning further strategy... It won't be an ongoing work stoppage. It will be an ongoing campaign."

Dive Brief:

• At least 100 union construction workers at the Tesla gigafactory in Reno, NV, walked off the job Monday in protest over allegations that New Mexico-based contractor Brycon Corp. has been using lower-paid workers from New Mexico and Arizona, according to the Las Vegas Review-Journal.
• Todd Koch, president of the Building and Construction Trades Council of Northern Nevada, said at the start of the project that there was a sufficient number of local workers employed at the factory, but, as time has gone by, Tesla has given Brycon more work, leaving the contractor free to bring more out of state workers onto the job.
• Tesla received $1.3 billion in tax incentives from the state of Nevada to build its battery factory in Reno, but the deal includes a provision that at least 50% of its employees, including construction workers, be Nevada residents, unless there isn’t enough local skilled labor available. A 2015 outside audit found that 74% of the gigafactory’s construction workers were Nevada residents.

Dive Insight:

"Nevada’s tax dollars should be used to provide jobs for Nevada construction workers — not New Mexico construction workers," Koch told the Review-Journal.

Tesla issued a statement and said, without using Brycon's name specifically, that more than 50% of "one of the third-party construction contractor's" employees are from Nevada, as are at least 75% of the battery factory’s entire workforce. The company also pointed out that the union's issue "is not with how Tesla treats its workers."

Tesla's $5 billion Nevada gigafactory, which the electric car maker has claimed will be the largest lithium-ion battery plant in the world, reportedly could become the world's largest building — in terms of footprint — by the time it is finished.

The gigafactory has spurred local and state economic development. County business licenses are up 41%, most of which are construction-related, and Nevada state officials have said they no longer need to court new businesses into Nevada.

However, this boom in activity by Tesla and the other large companies flocking to the area has also created a high demand for housing that developers are struggling to meet. Tesla and its competitor Faraday Future plan to hire 11,000 new workers over the next five years, which translates to 80,000 new residents, requiring 40,000 new housing units by 2020.