Elon Musk owes $500 million

Elon Musk owes $500 million

Elon Musk

When Elon Musk took over Twitter last year, he immediately began to cut back the company’s staff. Before Musk’s acquisition, the company had a workforce of around 8,000, a staff Musk quickly trimmed down to around 1,500.

“I wouldn’t say it was uncaring,” he said in a BBC interview in April. “If the whole ship sinks, then nobody’s got a job.”

But according to a new lawsuit filed by a former Twitter HR head Wednesday, Musk’s newly leaned-down company did not pay out the proper severance amounts to those thousands of workers he laid off.

The class action suit alleges that Twitter refused to pay out a total of at least $500 million in severance.

The lawsuit lays out a severance plan adopted by Twitter in 2019 which would enable workers who were laid off to receive two months of base pay plus an additional one week of pay for every year of service. Courtney McMillian, Twitter’s former Head of Total Rewards and People Experience, claims in the suit that Twitter gave at most one month of severance, with some employees receiving nothing at all.

Twitter, according to the suit, didn’t pay the full amount of severance “because of the expense involved.”

The suit, according to Reuters, alleges that Twitter (and Musk) violated a federal law that regulates employee benefit plans, making this case different from previous lawsuits Twitter has faced for failure to pay severance, which involve contractual breaches rather than the benefits law.

Twitter, which dissolved its press offices when Musk took over, responded to The Street’s request for comment with its standard automated reply: a poop emoji.

A separate lawsuit filed in June accused Twitter of failing to pay worker bonuses.

McMillian did not immediately respond to a request for comment.

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