Former employees at Twitter have filed a class action suit against the social media company after they were suddenly laid off in large numbers. These layoffs occurred after the company was purchased in a leveraged buyout by Elon Musk, who is also the CEO of Tesla and SpaceX, who began the firings as part of his overhaul of the company. In so doing, he may have violated federal and state labor laws, which protect against mass layoffs such as these from being performed without adequate notice.
What is Twitter?
Twitter is one of the world’s largest social media companies, with an annual estimated revenue of more than $5 billion and 450 monthly active users. Despite this, the company has long struggled to turn a profit, operating at a loss until relatively recently. The company was recently purchased by Elon Musk, CEO of Twitter and SpaceX, in a $44 billion leveraged buyout that effectively left him as the sole person in charge of the company’s day-to-day operations.
What is This Lawsuit About?
On Thursday, November 3, just a few days after the purchase was completed, Twitter informed its employees in a mass email that there would be major cuts to the company’s staff. The email stated that the following day, people would be informed if they were keeping their job, by their staff email if they were being retained, or by their personal email if not. By the next day, approximately half of the company’s staff had been fired in a mass layoff, with some people left in limbo without ever having received confirmation of their employment status.
Why is This Potentially Illegal?
This move appears to have been made in violation of state and federal law, which prohibits mass layoffs without warning. The federal Worker Adjustment and Retraining Notification (WARN) Act, for example, requires advance notice of at least 60 days before any mass layoffs or plant closings, with a similar California law requiring the same thing. The lawsuit says that California’s Employment Development Department did not receive a WARN Act notice as required by the law, meaning Twitter may have violated its employee’s rights.
Why Might it Matter to You?
Laws like the WARN Act exist to prevent the kinds of sudden mass layoffs like those that appear to have occurred at Twitter. When these kinds of layoffs happen, they leave large numbers of people suddenly out of work, without an opportunity to find alternative employment or deal with the personal ramifications of losing their job. Holding employers accountable for these sorts of labor violations can help to prevent them from happening in the future, as well as getting compensation for those affected by mass layoffs.
Steven Mitchell Sack, the Employee’s Lawyer, is a New York employment lawyer with more than 41 years’ experience handling the many aspects of employment law. His new book, “Fired!: Protect Your Rights & FIGHT BACK If You’re Terminated, Laid Off, Downsized, Restructured, Forced to Resign or Quit,” is available in hardback, and contains valuable advice on dealing with employment and labor law issues. To purchase the book, feel free to contact Steven Sack at 917-371-8000 or visit the website at legalstratpub.com. To inquire about a legal matter, please feel free to contact attorney Steven Sack at 917-371-8000 or stevensackatty@hotmail.com.
