❓WHAT HAPPENED: Elon Musk and his social media platform X (formerly Twitter) have reached a tentative settlement with former employees who sued for $500 million in severance pay.
👤WHO WAS INVOLVED: Elon Musk, X (formerly Twitter), and former employees led by Courtney McMillian.
📍WHEN & WHERE: The settlement was reported on Wednesday in a court filing in San Francisco.
💬KEY QUOTE: “The parties have reached a settlement agreement in principle and began negotiating the terms of a long form settlement agreement,” according to court documents.
🎯IMPACT: The settlement, once finalized, could resolve disputes over severance pay for approximately 6,000 former employees.
Elon Musk and his social media platform X (formerly Twitter) have tentatively settled a lawsuit with former employees seeking $500 million in severance payments. On Wednesday, a court filing showed that both sides asked a San Francisco U.S. appeals court to postpone an upcoming hearing to finalize the settlement documents.
The lawsuit, spearheaded by ex-Twitter employee Courtney McMillian, alleges that around 6,000 workers were denied benefits outlined in the company’s severance plan. Employees claimed the company offered some of them only one month’s severance pay at most, while others received none, despite promises of up to six months’ salary.
According to court filings, “the parties have reached a settlement agreement in principle and began negotiating the terms of a long form settlement agreement.” The settlement’s specifics remain undisclosed and await court approval.
The layoffs at Twitter followed Musk’s 2022 acquisition of the company, part of aggressive cost-cutting that slashed over half the workforce. This move preceded a broader tech industry trend, with companies like Facebook, Google, and Microsoft also cutting thousands of jobs over the following years.
Musk is known for using significant workforce reductions to lower costs. He attempted similar reforms to the federal workforce at the Department of Government Efficiency (DOGE) during the early months of the Trump administration, albeit with limited success.
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