It is fair to say that Elon Musk has had an impact in the three weeks since he bought the social media platform Twitter for $44 Billion, but our Head of Employment Law, Yunus Lunat, is not surprised the company are facing lawsuits from laid-off employees in the US, and says the multi-billionaire faces a human resources nightmare before his tenure as the new owner and CEO can settle down.
Tesla supremo Musk bought Twitter at the end of October, after a protracted buyout period, and immediately dismissed a series of top executives and laid-off almost half of the company’s overall staff overnight in a widespread cull. 3700 workers were made redundant on November 4th, while the company’s LinkedIn page was advertising 200 new job openings within days, and for very senior roles.
Twitter reaches out to laid-off employees
The chaos continued as the company started to “reach out” to a number of employees who had been laid-off the previous week, asking them to return as they had been let go “by mistake”, and the new management team claimed the employees had skills they had not anticipated they would need. In India, 180 out of 230 employees were made redundant, mostly from the product and engineering teams, which would have global repercussions, while the curation team – based across nine cities globally – was disbanded.
Not surprisingly, experts observing the seismic events have questioned the legality of the moves from an employment law standpoint. Already, Twitter has been hit with a raft of law suits from US employees – half of whom have been made redundant – claiming that the move was in violation of federal and state labour laws in the US, as employees were entitled to a minimum of 60 days’ notice.
Even this week, on the morning of Wednesday November 16th, the questionable practices have continued, with Elon Musk addressing the remaining workforce by email and giving them an ultimatum to commit to the new “hardcore” Twitter going forward, by clicking on a link to register this commitment, or face redundancy and a three-month severance package.
Redundancies must include proper consultation
Musk has responded to the lawsuits with a tweet claiming that all laid-off staff had been offered three months’ severance pay, which was “50% more than legally required”. But doubts exist as to whether proper redundancy procedures have been followed in all cases. Ison Harrison’s head of employment law, Yunus Lunat, commented: “As a point of principle, if a company is suffering losses then it is lawful to make redundancies, but that does not absolve it of the obligation to following a consultation.”
In the UK, people facing redundancy are entitled to a consultation period, time off to find a new job, a minimum notice period and a redundancy payment. In some cases the employer may also be required to offer an employee suitable alternative employment. However, in all cases, professional employment law services should ensure the employer follows the correct procedure and keeps the employee informed of developments at all stages.
Financially, it appears the redundancy purge at Twitter may well be justified and is part of a wider effort to cut costs amid a huge slump in advertiser revenue. However, Musk’s takeover doesn’t appear to be having a positive effect with advertisers leaving in droves, users deleting accounts and migrating to rival social media platforms and widespread concerns about content moderation, a rise in hate speech and misinformation, account authenticity and payment security.
Professional employment law services
Three top privacy and security executives resigned suddenly on 10th November, sparking fears about data privacy, while there has been back and forth confusion about a new subscription ‘Twitter Blue’ product, which was launched quickly and then shelved because of a “botched” launch. It will be re-launched on 29th November.
Musk has already spoken of a delicate financial future for Twitter and in his first email address to employees since taking over claimed that “bankruptcy isn’t out of the question”. This is sure to spark further fears over job security and widespread concerns that suitable and appropriate employment law practices will be observed.
Anyone with concerns over the redundancy process and fair treatment at Twitter or any other source of employment, should contact our employment law team at Ison Harrison, for specialist, professional and empathetic support and advice at this difficult time.