Twitter is embroiled in a fresh legal battle over alleged unpaid severance to its former employees. The lawsuit, filed in San Francisco federal court, accuses the company of failing to pay at least $500 million in promised severance to thousands of employees who were laid off following Elon Musk’s acquisition of the company.
CNBC reports that Elon Musk’s Twitter is currently involved in a legal dispute with former employees over claims of unpaid severance. The company is accused of failing to provide at least $500 million in promised severance to thousands of workers who were let go as a result of the acquisition, according to the lawsuit, which was filed in federal court in San Francisco.
The lawsuit was initiated by Courtney McMillian, a former senior employee who oversaw Twitter’s compensation and employee benefits programs as its “head of total rewards” before she was laid off in January. McMillian alleges that the company has not fulfilled its obligations under a severance plan created in 2019.
According to McMillian, if most employees were laid off, they would receive two months of their base pay plus one week of pay for each full year of service. According to the lawsuit, senior workers like McMillian were owed six months of base pay. However, the lawsuit alleges that Twitter only provided laid-off workers with at most one month of severance pay, and claims many employees did not receive anything.
According to the lawsuit, Twitter cut more than half of its staff as a cost-saving measure after Musk bought the business in October. The total layoffs exceeded this figure, ending up in the range of 75 to 85 percent of staff.
The lawsuit further accuses Twitter and Musk of violating a federal law regulating employee benefit plans. This is not the first time Twitter has faced legal action over severance pay. The company has previously been sued for allegedly failing to pay severance, but those cases involved breach of contract claims and not the benefits law. In June, Twitter employees sued the company over bonuses they claim Musk owes them.
In addition to this lawsuit, Twitter is also facing other legal challenges related to the layoffs that began last year, including claims that it targeted women and workers with disabilities. Twitter has denied any wrongdoing in the cases in which it has filed responses.
Read more at CNBC here.
Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship. Follow him on Twitter @LucasNolan