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Elon Musk faces a number of lawsuits for firing greater than 6,000 Twitter workers, together with then-CEO Parag Agrawal, following Musk’s 2022 takeover of the social media platform. On Tuesday, Musk defeated a kind of lawsuits, as a federal choose dominated X Corp. doesn’t owe the ex-employees any extra severance.
The lawsuit, filed by Twitter’s former head of individuals expertise and one other ex-manager, alleged that X Corp. paid fired Twitter workers much less severance than they had been contractually promised. The grievance acknowledged Twitter provided these 6,000 fired workers, at most, three months of severance pay, which Musk confirmed in a tweet on the time. Twitter’s Severance Plan, which was in impact since 2019, had beforehand promised senior workers upwards of six months of severance pay, in line with the grievance.
The plaintiff estimated Musk owed these former workers upwards of $500 million, citing protections beneath the federal Worker Retirement Earnings Safety Act (ERISA).
U.S. District Choose Trina Thompson dismissed the category motion lawsuit in San Francisco on Tuesday.
In a courtroom submitting, Choose Thompson mentioned the ERISA protections didn’t apply as a result of Musk’s firm notified workers shortly after the October 2022 takeover that fired workers would solely obtain money payouts. Due to this discover, the mass firings that occurred in November weren’t beneath Twitter’s earlier severance plan, in line with the choose.
“We’re dissatisfied within the ruling and contemplating our choices for shifting ahead,” mentioned a spokesperson for Sanford Heisler Sharp, the legislation agency representing the plaintiffs on this case, in an e-mail to TechCrunch.
Because the November 2022 firings, X Corp. has operated the social media platform with a bare-bones employees. Musk informed the BBC in 2023 that he introduced Twitter’s employees all the way down to 1,500 workers, from roughly 8,000 earlier than his takeover, citing main cost-cutting efforts. Regardless of the efforts, X has continued to battle, as paperwork obtained by Bloomberg confirmed the corporate misplaced $456 million within the first quarter of 2023.
Musk isn’t out of the water but for these mass firings. In one other lawsuit, Agrawal and three different former Twitter Inc. executives are in search of $128 million in severance funds from X Corp. after they had been let go within the mass firing. One other lawsuit from former senior workers at Twitter seeks greater than $1 million in severance funds, however Musk says he by no means agreed to those former workers’ profit plans.
This text was up to date on July 10 at 12:48 PM PDT to incorporate feedback from Sanford Heisler Sharp.
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