American billionaire won Elon Musk What is with you X platform (formerly Twitter) with a lawsuit alleging that he refused to pay at least $500 million in severance pay to thousands of platform employees he fired in mass layoffs after he acquired the social media company.
U.S. District Judge Trina Thompson in San Francisco ruled Tuesday that the federal Employee Retirement Income Security Act, which governs benefit plans, does not cover the former employees’ claims, and therefore she lacks jurisdiction.
According to the lawsuit, Twitter’s plan to terminate employees who remained after the acquisition included receiving two or six months’ pay, plus one week’s pay for each year of work, if they were laid off.
On the other hand, plaintiffs Courtney McMillian, who oversaw Twitter’s compensation and benefits, and Ronald Cooper, the company’s chief operating officer, said Twitter instead offered the fired employees just one month’s pay as severance pay, with no benefits.
An outside spokeswoman for Sanford Heisler Sharp, which represents the former employees, said the law firm was disappointed and was considering its legal options.
The case is one of several accusing Musk of reneging on promises he made to former Twitter employees after buying the company for $44 billion in October 2022, including that of former CEO Parag Agrawal.
(Reuters)