Twitter hit with ERISA lawsuit for failure to pay $50M in severance to ex-employees

Elon Musk and Twitter headquarters. Credit: Shutterstock.com/ALM

A lawsuit filed on Wednesday alleges that Twitter failed to pay at least $500 million in promised severance to thousands of employees who were laid off after Elon Musk acquired the company. Courtney McMillian, who oversaw Twitter’s employee benefits programs before she was laid off in January, filed the proposed class action in San Francisco federal court.

McMillian claims that under a severance plan created by Twitter in 2019, most workers were promised two months of base pay plus one week of pay for each full year of service if they were laid off. Senior employees such as McMillian were owed six months of base pay, according to the lawsuit. In addition, all employees were entitled to bonuses, a cash contribution for health insurance and three to six months of outplacement services, according to the lawsuit. However, Twitter provided laid-off workers with at most one month of severance pay, and many of them did not receive anything, the lawsuit said.