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Twitter Facing $500M Lawsuit Over Unpaid Severance Pay for Laid Off Workers
Twitter is mired in a new legal fight over alleged unpaid severance pay to former workers. The case, filed in federal court in San Francisco, accuses the corporation of failing to pay at least $500 million in promised compensation to thousands of employees who were laid off after Elon Musk bought the firm.
According to CNBC, Elon Musk's Twitter is presently embroiled in a legal battle with former workers over accusations of underpaid severance pay. According to the lawsuit, filed in federal court in San Francisco, the business is accused of failing to deliver at least $500 million in promised compensation to thousands of workers let off as a result of the acquisition.
Courtney McMillian, a former senior employee who supervised Twitter's compensation and employee benefits programs as its “head of overall incentives” before being let go in January, filed the case. McMillian claims that the business has failed to meet its commitments under a severance plan established in 2019.
If most staff were laid off, they would receive two months' basic salary plus one week's compensation for each complete year of service, according to McMillian. According to the lawsuit, McMillian and other senior employees were entitled six months of basic salary. Nevertheless, the complaint argues that Twitter only compensated laid-off employees with up to one month of severance money and that many employees received nothing.
According to the complaint, after Musk purchased the company in October, Twitter terminated more than half of its workforce as a cost-cutting move. The overall number of layoffs exceeded this amount, reaching 75 to 85 percent of the workforce.
The complaint also charges Twitter and Musk with breaking a federal statute governing employee benefit schemes. This isn't the first time Twitter has been sued for severance pay. Previously, the corporation was sued for allegedly neglecting to pay severance, but those instances featured breach of contract grounds rather than benefits law issues. Twitter employees sued the firm in June over compensation they think Musk owes them.
In addition to this case, Twitter is facing other legal issues in connection with the layoffs that began last year, including allegations that company discriminated against women and workers with disabilities. In the cases where it has submitted answers, Twitter has denied any wrongdoing.
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