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Twitter and Elon Musk owe $500 million in severance to laid off employees, claims new suit
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Twitter and Elon Musk owe $500 million in severance to laid off employees, claims new suit
Jul 12, 2023 11:53 PM

A former Twitter employee has filed a new lawsuit against Twitter that alleges the social media giant of refusing to pay at least $500 million that it promised as severance to employees laid off following Elon Musk’s take over of the firm.

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The lawsuit filed in the federal district court in California was filed on behalf of Courtney McMillian, a former human resources leader at Twitter who was let go as part of the mass layoffs Musk conducted, the week after he came on board in 2022, according to CNN.

The former Twitter employee alleged that the firm assured employees about its severance plans multiple times. The suit mentions that Twitter promised senior employees severance of six months of base pay plus one week for every year of service, in addition to other benefits. However, Musk owned Twitter provided laid off employees with a total of three months of pay, including the state and federally mandated notice periods, it claims.

In response to a request for comment on the lawsuit, Twitter sent CNN an automated poop emoji.

Meanwhile, it must be noted that the lawsuit accuses Twitter and Musk of violating a federal law regulating employee benefit plans. Twitter has already been sued for allegedly failing to pay severance, but those cases involve breach of contract claims and not the benefits law. The company has said it has paid ex-employees in full, Reuters pointed out.

However, McMillian, the latest complainant claims that Twitter only gave laid-off workers at most one month of severance pay, and many of them did not receive anything.

A pending lawsuit filed last month accuses Twitter of also failing to pay millions of dollars in bonuses it owes to remaining employees. Twitter has said the claims lack merit.

Musk has cut around 80 percent of Twitter’s staff from prior to the takeover in his nine months owning the company, as per CNN.

CNN also pointed out that over 1,500 former employees have filed arbitration claims, after Twitter pushed for anyone who had signed an arbitration agreement while working at the company to pursue their claims out of court.

(With inputs from agencies)

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