Twitter Accused of Owing $500M in Severance Pay

A new class-action lawsuit accuses Twitter of failing to pay $500 million or more in severance it owes to laid-off employees. According to the class-action lawsuit proposed in a San Francisco federal court by Courtney McMillian, a former human resources employee at Twitter who was let go in January, a 2019 severance plan promised most workers two months of base pay (six months for more senior workers) plus a week of pay per full year of employment in the event of a layoff, and other benefits. When mass layoffs did take place after Elon Musk took over the company, however, workers received at most one month's severance pay, Reuters reports. In addition to the month of severance, they received an additional two months' pay to comply with state and federal mandates, CNN reports.

The complaint accuses Musk of knowing about the severance plan, but not wanting to take on the "expense," and of only paying out a "fraction" of what employees were due. It also accuses the company of misleading workers about whether the 2019 plan would be followed, the BBC reports. "Musk initially represented to employees that under his leadership Twitter would continue to abide by the severance plan," says the attorney representing McMillian. "He apparently made these promises knowing that they were necessary to prevent mass resignations that would have threatened the viability of the merger and the vitality of Twitter itself." (Twitter is also being sued over alleged gender bias in its layoffs.)