Laid-Off Twitter Employees Sue Musk Over Severance Pay

The Twitter headquarters signage on 10th Street in San Francisco on Nov. 4, 2022. David Odisho/Getty Images

Recently fired Twitter employees are now suing the social media company after its new owner, Elon Musk, pulled their original severance benefit packages.

Five of the former employees, who filed a class action complaint against Twitter, have accused Musk of breaking his promise to allow them to keep at least two months of severance pay, bonus plan compensation, cash convertible company stock, and health insurance coverage, according to court documents seen by The Epoch Times.

All five lost their severance benefits when Musk laid off half of Twitter’s staff, or about 3,700 employees, on Nov. 4.

Three of the plaintiffs, according to the filing, were locked out of their company accounts on Nov.  3 but notified that they would receive pay until Jan. 4, 2023.

Twitter announced in a company email on Nov. 3, that it would begin the layoffs in “an effort to place Twitter on a healthy path and” that said staffers would get notices via email about their employment status.

The new complaints were posted on updated court filings at the federal court in San Francisco on Nov. 8, reported BusinessInsider.

Musk Under Fire

The attorney for the five workers, Shannon Liss-Riordan, filed an emergency motion on Nov. 9 to compel Twitter to inform laid-off employees about the pending lawsuit before it can reach any separation agreements with them.

Twitter’s management had allegedly promised that all terminated employees would retain the equivalent of the original severance package after Musk took over the social media platform.

The plaintiffs said they had “reasonably relied” on this pledge and provided evidence of statements made at company staff meetings, a recent FAQ, and in the merger agreement filed with the SEC.

They said that because they had no reason to believe that Musk would cut their separation packages, so they failed to look for jobs elsewhere.

The claims made in the class action filed on Nov. 1 differ from a more recent statement made by Musk via Twitter.

“Regarding Twitter’s reduction in force, unfortunately there is no choice when the company is losing over $4M/day. Everyone exited was offered 3 months of severance, which is 50% more than legally required,” stated Musk in a tweet on Nov. 5.

Elon Musk's Twitter profile on a smartphone placed on printed Twitter logos on April 28, 2022. Dado Ruvic/Illustration/Reuters

Twitter later informed the former employees that they would now only receive one month’s base pay after their termination, according to the accusation in the updated lawsuit.

Parag Agrawal, Ned Segal, Vijaya Gadde, and Sarah Personette, Twitter’s former top executives, would have taken in a collective $88 million severance package after their separation from the company.

Musk, on Oct. 31, denied that he had gotten rid of the four “for cause” to avoid giving them hefty severance payout bonuses, reported BusinessInsider.

WARN Act

“Twitter is now engaged in conducting mass layoffs without providing the required notice under the federal WARN Act,” said the lawsuit.

The WARN Act is the Worker Adjustment and Retraining Notification Act, which requires a 60-day notice for certain plant closings or mass layoffs.

Riordan accused Musk of allegedly counting an extra two months of severance pay after certain employees were told last week that they would be laid off within 60 days.

She said that Musk was trying to force all laid-off employees to release their claims on their compensation benefits in exchange for their one month of severance pay.

Twitter's headquarters in San Francisco on Aug. 13, 2019. Glenn Chapman/AFP via Getty Images

The lawsuit further alleges that some staff members were locked out of their Twitter account’s notification function that they were laid off but were later told they would receive severance pay until Jan. 4, 2023.

Twitter has promised that it will continue to provide pay and benefits to former employees, even after their termination.

Employees Ordered Into Office

Meanwhile, Musk sent his first email to employees on Nov. 9, ordering them to return to the office within one day while banning remote work.

“The road ahead is arduous and will require intense work to succeed,” the email read.

“Starting tomorrow (Thursday), everyone is required to be in the office for a minimum of 40 hours per week.”

Liss-Riordan said in her filing, that Musk made a promise to Twitter employees that they could keep their remote working arrangements.

“Since taking control of Twitter just two weeks ago, it seems Elon Musk has worked every day to find new and creative ways to screw over the company’s workers,” Liss-Riordan told Business Insider.

“This emergency motion that we just filed is an effort to protect the employees Twitter is laying off from signing away their rights to get what they are owed by the company.”