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Twitter owes ex-employees $500 million in severance, lawsuit claims

Twitter owes ex-employees $500 million in severance, lawsuit claims

Thousands of Twitter employees were laid off when Elon Musk took over last year

Twitter has been hit with a huge lawsuit as former employees demand hundreds of millions in severance.

Last year saw the tech giant bought by Elon Musk in a huge $44 billion takeover.

Following the buyout, thousands of employees were laid off, with around 80 percent of staff being let go by the new owner.

In total, the number of workers went from 7,500 to around 1,300.

However, many of those who were fired have taken legal action against Twitter, claiming they were owed at least two months of pay.

It's said that under a previous agreement, which was set up in January 2019, most workers at the social media company were promised two months of their base pay plus one week of pay for each full year of service if they were sacked.

Thousands of staff were sacked following Elon Musk's Twitter takeover.
The Met Museum/Vogue/Justin Sullivan/Getty Images

Courtney McMillian was the 'head of total rewards' and oversaw employee benefits at Twitter.

Filing the lawsuit, she claimed that senior members of staff such as her were actually owed six months of basic pay.

However, McMillian said that they only received one month of severance pay, while others received nothing.

The lawsuit also claims that Twitter and its owner had violated federal laws around employee benefits.

It says the amount Twitter offered was a 'fraction of what employees are entitled to' under the company’s severance plan, and it estimates that 'the terminated employees are entitled to no less than $500 million'.

The filing also invites anyone who was fired by the company since Musk took over to join the legal action.

Former employees claim they weren't given the proper severance after being fired.
David Odisho/Getty Images

This isn't the only lawsuit the tech firm is facing, though.

Since Musk took over, Twitter has faced a number of legal actions, and is already battling a separate lawsuit around severance pay.

The suit was filed by Fabien Ho Ching Ma earlier this month, who was fired in November last year.

According to the filing, Twitter failed to pay the arbitration fees for 891 cases, despite laid-off workers signing agreements that requite them to arbitrate legal disputes in order to get severance pay.

Twitter has also been sued half a dozen times for allegedly failing to pay rent for use of office space.

While a private jet firm has taken legal action against the company over an alleged breach-of-contract.

Twitter does not have a press office to contact for comment regarding the most recent allegations.

Featured Image Credit: Dimitrios Kambouris/Getty Images for The Met Museum/Vogue/Justin Sullivan/Getty Images

Topics: Twitter, Elon Musk, Technology