A former Twitter employee has filed a new lawsuit against Twitter and its owner, Elon Musk, alleging that the company failed to fulfill its commitment of providing the full amount of severance promised to employees during mass layoffs in November. The lawsuit, seeking class action status, was filed in a federal district court in California and requests that Musk and Twitter be ordered to pay additional severance benefits to former employees, amounting to no less than $500 million.
The complaint, brought forward by Courtney McMillian, a former human resources leader at Twitter who was among those laid off after Musk's acquisition of the company, states that Twitter repeatedly assured employees about the severance plan during Musk's takeover to retain workers. Specifically, the complaint alleges that Twitter had pledged senior employees a severance package comprising six months of base pay and an additional week for each year of service, along with other benefits. However, Musk's Twitter provided laid-off employees with a total of three months' pay, inclusive of state and federally mandated notice periods.
Since taking ownership of Twitter, Musk has reduced the company's workforce by approximately 80 percent in the nine months of his tenure. This lawsuit adds to a series of legal actions brought against Twitter by former employees making severance-related claims. Over 1,500 former employees have submitted arbitration claims after Twitter pushed for those who had signed an arbitration agreement during their employment to resolve their disputes outside of court.
Kate Mueting, one of the lawyers handling the case, highlighted that this lawsuit relies on the Employee Retirement Income Security Act, a federal law that the firm argues supersedes Twitter's arbitration agreement. Consequently, if the suit is granted class action status, former employees may be eligible to participate, regardless of whether they signed the arbitration agreement.
Apart from the employee-related legal battles, Twitter is also facing lawsuits from vendors, landlords, and business partners who allege non-payment of dues. Additionally, music publishers have lodged copyright infringement claims against the platform. Last week, a lawyer representing Twitter sent a letter threatening to sue Meta, a new rival platform, over its product, Threads.
Overall, the latest lawsuit against Twitter and Elon Musk highlights allegations of unfulfilled severance commitments and adds to the legal challenges faced by the social media giant.
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