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X faces millions in fees over unpaid severance for former Twitter employees
September 5, 2023

X faces millions in fees over unpaid severance for former Twitter employees

Reading Time: 2 minutes

X currently faces 2,200 arbitration cases from ex-employees.

Shortly after Elon Musk acquired Twitter late last year, the company underwent a number of rounds of layoffs and thousands of employees were let go. Severance was promised to Twitter’s now-former workforce…severance in which Musk isn’t paying.

And it looks like not paying severance is going to cost him.

Twitter, now known as X, is currently facing 2,200 arbitration cases from former employees looking to get their deserved benefits. The number of arbitration cases was first highlighted by CNBC as a result of a new filing in a lawsuit against Twitter from one of its former employees looking to get their promised severance. 

Earlier this year, former Twitter employees had to drop a class action lawsuit against the company in favor of legal arbitration as a result of a clause in their contract with the company. The contract required that any disputes be resolved through an arbitration service known as JAMS.

Former Twitter employees soon found themselves filing another class action lawsuit against the company not long after that initial suit was dropped. This suit is seeking to force Musk and company to pay the required fees for the arbitration cases mandated in their former employer’s contract.

With this new filing, we now get a better understanding of why Musk is looking to avoid paying those fees. For 2,200 arbitration cases, X is looking at paying more than $3.5 million in filing fees alone.

JAMS charges $2,000 per two-party case. Former employees are only on the hook for a $400 of that fee as the company states it’s the maximum amount they need to pay if a company obligated them to go through arbitration as part of their contract.

X is now facing multiple lawsuits from ex-employees regarding the delay of arbitration due to its refusal to pay the filing fees. For its part, X’s legal representatives have argued that the company did not require former employees to move their cases to arbitration.

Those 2,200 arbitration cases plus related lawsuits are part of a growing number of legal cases in which Musk’s X is currently involved. Earlier this month, X filed a lawsuit against the Center for Countering Digital Hate, a disinformation research organization. The company also filed a lawsuit last month against the law firm that the prior Twitter administration utilized to force Musk to uphold his end of the acquisition deal. X has also faced multiple lawsuits ranging from landlords to software vendors for unpaid bills over the past 10 months.


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