Is severance something that’s legally required?
https://www.shrm.org/resourcesandtools/legal-and-compliance/...
> X agreed to pay severance in employees' initial offer letters and later confirmed workers would receive severance at least as favorable during the post-merger period as they had under the old management. The severance plan entitled laid-off workers to at least two months of base salary, pro-rated performance bonuses as though all triggers for such bonuses had been hit, the cash value of any restricted stock units that would have vested within three months of separation, and a cash contribution for the continuation of health care coverage. Instead, the company paid two months of base salary to comply with the notice requirements of the federal Worker Adjustment and Retraining Notification (WARN) Act, plus one month of severance pay, according to court documents.
https://en.m.wikipedia.org/wiki/Severance_package
But Musk did publicly promise severance, then didn’t deliver. That would almost certainly be breach of contract.
And also given that Twitter universally refused to pay severance in all markets, including those with mandatory severance, I suspect Twitter’s decision isn’t coming from a legally sound place.
> 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.
Key word here is the severance was promised to “most”, not “all” employees. Was that how it went down? I dunno, the article doesn’t say. Now you’re saying that no one was paid severance (“universally refused to pay severance in all markets”). Seems like there’s a lot of uncertainty here.
>38. Section 6.9 of the Merger Agreement provided that for one year following the closing of the merger, Twitter would continue to provide Plan participants with “Severance payments and benefits . . . no less favorable than” those provided under Twitter’s policies immediately prior to the merger.
> 39. The same day the Merger Agreement was announced, Twitter’s then-CEO, Parag Agrawal and its then-Chairman Bret Taylor met with all Twitter employees and informed them that Twitter would continue to provide the severance Plan benefits for at least one year following the change in company ownership.
>42. The Acquisition FAQs relied on the Merger Agreement and stated that “[t]he terms of the agreement specifically protect Tweep [Twitter employees] benefits, base salary, and bonus plans (short/long term incentive plans) so they cannot be negatively impacted for at least one year from the closing date.” The FAQ specifically stated that, “[i]n the event of a layoff, any employee whose job is impacted would be eligible for severance.”
That final sentence in 42 is pretty solid.
[0] https://variety.com/wp-content/uploads/2023/07/McMillian-v.-...
That's established law, it's the only way to hold companies to any of their promises.
We don't know what went down. Musk could have actually paid 50.1% (or greater) employees severance. It doesn't matter, because in the U.S. you can sue anyone else for anything, illegal or not. I can sue you because your username sucks, for example. Oh and if you don't show up, I win a default judgement, so there is that.
For example, federal courts can dismiss a case due to lack of standing in sua sponte (Frank v Gaos).
While you can file any sort of insanity, the courts are not beholden to just robotically follow though with it.
Detrimental reliance/promissory estoppel.
If an employee continues to work under a contract, relying upon a promise that is later broken...
Unless you want future options with the person you are suing. Unless you need a reference. If you can afford it and if you are prepared to burn bridges.
(1) In some jurisdictions, some amount of severance is legally required in some circumstances, but the count at issue here is all in US jurisdictions where I don’t think that applies (to severance narrowly; there’s been some conflation of pay during a no-duty employment period that was used to comply with state and/or federal WARN Act notice requirements as “severance”, and while full pay and benefits for that time is legally required, its not severance in the strict sense),
(2) In most US jurisdictions, there is no general legal mandate for severance, but severance that is embodied as a term in the employment contract or otherwise part of a legally binding commitment or promise is required, and these cases involve specific allegations of such contracted or otherwise bindingly-committed-to severance.