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“X” Didn’t Pay Severance. Now It’s Facing 2,200 Cases—and Big Fees (www.motherjones.com)
submitted 1 year ago by MicroWave@lemmy.world to c/news@lemmy.world
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Elon Musk’s alleged penchant for not paying bills is catching up with him. In the wake of numerous lawsuits claiming the world’s richest man failed to pay severance owed to many of the 6,000 employees he fired after acquiring Twitter. On Monday, CNBC reported that the tech company now known as X is facing some 2,200 arbitration cases filed by ex-employees, which come with $3.5 million in required fees—an amount that doesn’t even include the actual severance owed to those Musk let go.

In October, shortly after taking Twitter’s reins, Musk laid off more than half of its employees, promising most at least two months’ salary plus a week’s pay for every year they’d worked at the firm. Thousands claim that they haven’t received a single dime, and ex-employees have since filed several lawsuits seeking their promised benefits.

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[-] papalonian@kbin.social 120 points 1 year ago

You guys are failing to see that this was a simple misunderstanding.

Musk was told he needed to pay severance to all the ex employees, but he was confused why he was paying severance to "X employees" if they were still employed, so he simply didn't.

It's an easy mistake. Anyone could've done it.

[-] spider@lemmy.nz 13 points 1 year ago

Hence the rename from Twitter -- more five-dimensional chess from that crafty bastard.

[-] FlyingSquid@lemmy.world 6 points 1 year ago

Ah, the old Ravenous Bugblatter Beast of Traal gambit.

[-] bradorsomething@ttrpg.network 104 points 1 year ago

I worked at a company (as briefly as possible) where an advisor came in and did this. He started listing off who we actually needed to pay on our rotating debts and who we could put off and how long. When I left, within 3 months several very important vendors were calling asking if I could do anything to help them out. I told them if they stopped sending supplies that would probably help the process.

[-] fosforus@sopuli.xyz 64 points 1 year ago* (last edited 1 year ago)

Our dumb CFO held every 100k payment to motherfucking AWS until they were threatening to cut off our service during the next 24h. It was incredible to watch. Or perhaps this is perfectly normal in the absolutely abnormal corpo life.

[-] archiotterpup@lemmy.world 5 points 1 year ago

To think a bunch of C students get an MBA to spread this trash and collect consulting fees and I just thought working hard would let to success.

[-] ChickenLadyLovesLife@lemmy.world 34 points 1 year ago

I told them if they stopped sending supplies that would probably help the process.

Somebody running a business actually needed to be told this?

[-] NotYourSocialWorker@feddit.nu 50 points 1 year ago

Many sub contractors live on the mercy of the companies they supply. That forces them to show more goodwill than they want.

I remember a couple years back when Ericsson unilaterally decided that they would stop paying their bills after a month and instead changed it to three months. So, do you want to piss off the biggest company in the region or do you just say "Thank you, sir"?

As an aside, what kind of amoral sod goes around teaching companies what bills they can ignore and how morally bankrupt must you be to listen to them?

[-] bradorsomething@ttrpg.network 9 points 1 year ago

Capitalism has no moral component. In fact, quite the opposite in its purest form.

[-] ChaoticEntropy@feddit.uk 8 points 1 year ago

When your neck is on the chopping block anyway, I guess you see how long you can spin out your last words.

[-] NotYourSocialWorker@feddit.nu 4 points 1 year ago

Tomorrow is a better day to die

[-] fiat_lux@kbin.social 58 points 1 year ago

Elon Musk’s alleged penchant for not paying bills is catching up with him.

Citation required. It's not having any effect on him personally, the businesses are the ones which are affected. And when you're not depending on your businesses to eat and live, there are zero consequences.

They're all his shitty decisions, but as usual, he doesn't pay for it. The profits are privatised while the losses are socialised. And I'm pretty sick of the media counting eggs before they hatch, because they usually don't hatch at all.

[-] Chozo@kbin.social 41 points 1 year ago
[-] fiat_lux@kbin.social 31 points 1 year ago

Yes, the business he bought (with not only his money) has been sued and evicted. The only time Musk has personally ever been on the hook was when he tried to wriggle out of buying said business, and the business sued him personally. Otherwise, he can walk away consequence-free from everything else.

[-] Chozo@kbin.social 6 points 1 year ago* (last edited 1 year ago)

Yes, the business he bought (with not only his money)

That's literally part of the problem. He hadn't paid interest on the loan he took out to buy Twitter.

But also, he was CEO when these things all happened. He is the one who made the decisions not to make payments toward rent on two of his offices, toward his loan, or toward his consulting firm. I'm not sure what sort of mental gymnastics you're doing to say that he isn't responsible for these things. Twitter wasn't having those problems pre-Musk, and is only having these problems as a direct result of Musk's decision-making. That's kinda part of what being a CEO entails.

Not sure why one would ask for citations and then dismiss them.

[-] Armok_the_bunny@lemmy.world 26 points 1 year ago

They aren't saying he pays his bills, they're saying there are effectively no consequences for him personally every time he does it. He's not the one footing the bill for these Xitter lawsuits, it's his company.

[-] kbotc@lemmy.world 4 points 1 year ago

He privately owns Twitter, so he can do whatever he wants with it.

The issue is that he took out billions of dollars in Tesla stock loans to cover the Twitter sale, so if Twitter fails and the people that gave him cash ask for the cash back: he has to hand over his collateral, which is largely his controlling stake in Tesla.

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[-] ChickenLadyLovesLife@lemmy.world 22 points 1 year ago

I think they meant citation required for the "is catching up with him" part.

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[-] jjjalljs@ttrpg.network 46 points 1 year ago

I still don't understand why no one has just pushed this guy out a window yet.

[-] gullible@kbin.social 45 points 1 year ago

I don’t mean this as a threat, but as plain kinetic question. How do billionaires stay so safe with so many enemies? It’s a bit baffling to me. Security is fascinating to me.

[-] Shadywack@lemmy.world 34 points 1 year ago

In this present day, we're barely steps or even a half step away from having absolutely tyrannically-dictator type behaviors from billionaires. It's almost as bad as the Roman Emperors that were batshit crazy, and their own Praetorian Guard eventually took those motherfuckers out. It baffles me how we had Presidential assassination attempts as recently as the 80's in the US but wasting billionaires just isn't a thing. It's very amazing power structure.

[-] FaeDrifter@midwest.social 7 points 1 year ago

Zuckerberg spends about $30 million per year on personal security, I would guess the rest of the billionaires do the same.

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[-] PersnickityPenguin@lemm.ee 20 points 1 year ago

It's because people like this around themselves with a cadre of yes men. Apparently Elon is known to have a large group of Tesla and SpaceX groupies essentially. To use them to replace key positions at X.

[-] shuzuko@midwest.social 15 points 1 year ago

On that's easy, it's because he's still on Putin's good side.

As to why no one has... encouraged him into any other "mysterious accident", though, your guess is as good as mine.

[-] OutlierBlue@lemmy.ca 11 points 1 year ago

Because you don't get your money back if you kill him. That's why the mob just breaks kneecaps.

[-] Thetimefarm@lemm.ee 11 points 1 year ago

No you just put a cut on the end of their pointer finger on their dominant hand. That way every time they touch something it reminds them who their money belongs to. You save kneecapping for someone who you've lost all hope of paying you back and now their value to you is as an example for others.

[-] TheGiantKorean@lemmy.world 7 points 1 year ago

... you sound like you have experience

[-] FlyingSquid@lemmy.world 9 points 1 year ago

He took a big loan from the Saudis to pay for Twitter, so that could still happen.

[-] XTornado@lemmy.ml 10 points 1 year ago

Not out of a window I guess. They have other style.

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[-] assassinatedbyCIA@lemmy.world 4 points 1 year ago

Doesn’t he walk around the twitter headquarters surrounded by his own security.

[-] PrinceWith999Enemies@lemmy.world 34 points 1 year ago

I haven’t yet seen an article where a reporter totals up the numbers and associated dollar amounts associated with Musk’s mismanagement. In terms of general classes - and I’m just going off the top of my head here - we’re looking at (including only the twitter related ones):

  1. Failure to pay agreed upon payouts for fired employees
  2. Age discriminatory termination lawsuits
  3. Violation of employment contracts re: return to work and other conditions
  4. Failure to pay rents and infrastructure fees
  5. Failure to moderate content according to legally required regulations
  6. Allocation of TSLA employees to work at Twitter, a different company with different shareholders, thus robbing Peter to pay Paul on investors’ dimes

There were also potential suits over mass terminations contrary to state and national laws, but I haven’t heard as much about those recently.

[-] remotelove@lemmy.ca 14 points 1 year ago

In the event that Twitter files for bankruptcy, would it partially shield them from all that debt? Yeah, it's a dirty play and would totally expect Elon to do it if he could.

[-] originalucifer@moist.catsweat.com 5 points 1 year ago* (last edited 1 year ago)

its so much worse than just that. there are so many financial mechanisms to avoid liability its not even funny. most of the unwashed are unfamiliar with them because they are specifically written to keep rich people rich.

money flows to the top, accountability... not so much. and that is 100% the design.

the twist here is a callous, idiotic billionaire using this lack of responsibility for his own enjoyment. he will never, ever personally suffer for any of the harm caused to all humans affected by his terrible business practices. he is shielded by money, or what we call money these days.

twitter will cost him billions in personal funds when it goes under, and it will not affect him at all.

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[-] Godric@lemmy.world 33 points 1 year ago

X just might mark the spot for treasure here

[-] assassinatedbyCIA@lemmy.world 26 points 1 year ago

X is not gonna give it to ya

[-] MrFlamey@lemmy.world 23 points 1 year ago

So was the rebranding of Twitter to X just so Elon could say "U fuckin' wot m8? This company is X, and your employment contract is with Twitter, so it looks like you were never employed here."?

[-] TechnoBabble@lemm.ee 23 points 1 year ago

Fortunately that doesn't work.

Even if Musk totally shut down Twitter, then opened an identical platform named X, the contracts Twitter held are still enforceable under the law.

There might be stipulations in the contracts where severance isn't payable if the company fails, but if I remember correctly, this severance is something mandated by state law, and not just a contractual perk.

So bottom line, Musk is liable unless his lawyers are able to worm their way into a settlement.

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[-] aegisgfx877@kbin.social 18 points 1 year ago* (last edited 1 year ago)

Couldnt happen to a nicer dbag

[-] downpunxx@kbin.social 19 points 1 year ago

he couldn't care less, he's worth 95 Billion more now than when he purchased Twitter, the cruelty is the point

[-] NewPerspective@lemmy.world 14 points 1 year ago

This sounds like purposeful sabotage, but then again I've been saying that daily since Musk took over.

[-] ewe@lemmy.world 11 points 1 year ago* (last edited 1 year ago)

Smart. Flush money down the toilet trying to impersonate Trump by not paying your bills. Maybe he should run for president.

[-] dmonzel@lemmy.world 11 points 1 year ago

Thankfully he can't.

[-] nucleative@lemmy.world 7 points 1 year ago

Waiting like this was smart. Unfortunately.

Options:

  1. Stall as long as possible. Twitter makes a bunch of money. Have money to pay severances. All good.

  2. Twitter fails anyways. No money to pay anybody but had as long a runway as possible. Bankrupt and a financial guy nominated by a judge sorts it out.

[-] FlowVoid@midwest.social 5 points 1 year ago* (last edited 1 year ago)

When a company files for bankruptcy, employees who are owed money get first dibs on the liquidated assets.

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this post was submitted on 04 Sep 2023
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