Elon Musk Loses Legal Battle Over Unpaid Severance to Former Employee
Elon Musk has lost a legal dispute regarding unpaid severance to a former employee who was laid off after his acquisition of a major social media platform in 2022, according to a memo reported by Bloomberg News.
Resolution After Almost Two Years
The resolution of the case, which was handled through arbitration, comes nearly two years after Musk purchased the platform for $44 billion and subsequently laid off more than half of the workforce.
This move led to over 2,000 complaints from former employees, who claimed they were not fairly compensated. The victory in this particular case could set a precedent for the thousands of other ex-employees who have filed similar arbitration claims.
“The arbitrator awarded the full severance package to our client,” said lawyer Shannon Liss-Riordan in the memo, which was shared by two former employees who wished to remain anonymous due to the confidential nature of the case. “We are excited about this development and hope it signals more positive outcomes in the future.”
Liss-Riordan declined to comment further or disclose the arbitrator’s written ruling following the private arbitration session.
The company did not respond to a request for comment.
Previous Legal Challenges
In July, Musk and his rebranded company, X Corp., successfully defended against a lawsuit that claimed $500 million in severance was owed to approximately 6,000 laid-off employees under federal employment laws.
In the memo, Liss-Riordan mentioned that 15 arbitration cases have already been heard, and she expects more rulings to be issued in the coming months.
“We hope that if more rulings go in our favor, the company will be willing to negotiate a settlement for all affected employees,” she wrote.
