Silence on severance pay for laid-off Twitter employees can land Elon Musk in legal trouble: Report

Just a week after taking the reigns of the social media firm, Musk sacked over 7,000 employees on November 4.

Around 1,000 of those workers lived in California, the report said citing documents filed with the state. According to the state and federal rules, terminated employees were required to keep receiving regular paychecks over the past two months.

However, even after the elapse of 60 days since the mass layoff, employees living in California have still not heard any details about additional severance, or continuation of health coverage, known as COBRA, according to three laid-off workers, the report said.

This comes despite Musk’s tweet at the time of retrenchment that everyone “was offered 3 months of severance.”

As Musk acquired the company for a hefty $ 44 billion, he warned that the company could face bankruptcy and the layoffs were a part of his plan to cut costs.

Earlier this week he cut off other employee benefits such as commuter benefits and meal allowances, according to Platformer.

Twitter faces multiple litigations over unpaid bills, including for private chartered plane flights, software services and rents at one of its San Francisco offices, said the report.

Bloomberg reported that Boston-based labour attorney Liss-Riordan has filed private arbitration cases and several federal class-action lawsuits and US labor board complaints related to the mass terminations, alleging a mix of retaliation, discrimination, and failure to provide the required notice and pay.

“No one has gotten any severance pay,” Liss-Riordan was quoted as saying by Bloomberg.

The labour attorney said 100 arbitration claims were filed on Thursday, on top of 100 already pending.

“We don’t know what Elon Musk is doing — we expected that those severance agreements would have been sent out by now, because a lot of people had their last official day,” Liss-Riordan was further quoted as saying by Bloomberg. “We’re wondering what he’s planning to do but meanwhile we’re pushing forward with our legal actions.”

Twitter has asked the judge in the San Francisco court to either dismiss the severance suit or, alternatively, move it to Delaware where Twitter is involved in lawsuits in other cases including the fight over the buyout of the company.

Twitter argues its former employees are bound by contractual agreements requiring them to resolve any disputes with the company in closed-door arbitration rather than in open court, said the report.

Employees who were laid off in New York are eligible to get 90 days payment after being terminated, according to state labour laws.

Liss-Riordan said Musk needs to make a decision whether he wants to tangle himself in a costly drawn-out legal battle or take the right steps immediately.

“He’s got to make a decision here: does he really want to get into this costly drawn-out legal battle which is going to be very, very, very expensive for Twitter, or does he want to do the right thing and just take care of it now?” Liss-Riordan was quoted as saying in the report.