In a significant legal development, billionaire Elon Musk and his social media firm X have reached a tentative settlement with former Twitter employees who had filed a $500 million (£373 million) lawsuit seeking severance payments. Court filings submitted on Wednesday indicate that both parties have requested the US appeals court in San Francisco to delay an upcoming hearing as they finalize the settlement details.
The lawsuit emerged after Musk's acquisition of Twitter in 2022, during which the company let go of approximately 6,000 workers - over half of its workforce - as part of aggressive cost-cutting measures. Some of these former employees, led by Courtney McMillian, alleged they were wrongly denied benefits pursuant to the company's severance policy, which typically promised up to six months of salary in severance pay. However, many employees received only one month of pay following their layoffs, while some were left with nothing.
The mass layoffs at Twitter were among a broader trend of job cuts across the tech industry, where firms like Facebook, Google, and Microsoft subsequently let go of tens of thousands of employees after extensive hiring during the early COVID-19 pandemic. Musk's decision to streamline operations has drawn parallels to his previous actions in reducing staff while heading President Donald Trump's Department of Government Efficiency, which aimed to cut government spending and jobs.
As the terms of the settlement are still under wraps, it awaits court approval before being publicly disclosed. The developments surrounding Musk and the ex-Twitter employees continue to draw attention as they highlight the ongoing challenges workers face in the evolving landscape of corporate America. Further insights are expected as both sides work towards finalizing the agreement.
