{"id":20450,"date":"2022-11-08T23:29:38","date_gmt":"2022-11-08T23:29:38","guid":{"rendered":"https:\/\/www.shrm.org\/resourcesandtools\/legal-and-compliance\/employment-law\/pages\/elon-musk-twitter-tesla.aspx"},"modified":"2022-11-08T23:29:38","modified_gmt":"2022-11-08T23:29:38","slug":"elon-musk-faces-lawsuits-at-twitter-and-tesla","status":"publish","type":"post","link":"https:\/\/squarehr.com\/index.php\/2022\/11\/08\/elon-musk-faces-lawsuits-at-twitter-and-tesla\/","title":{"rendered":"Elon Musk Faces Lawsuits at Twitter and Tesla"},"content":{"rendered":"

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?Not only is Elon Musk facing a lawsuit at Twitter, where former workers say they didn’t receive proper notice from the new CEO of their employment being terminated. Musk is headed to trial to answer to a Tesla shareholder who is seeking to rescind a 2018 pay deal of $56 billion for the company’s CEO on the grounds that it unjustly compensates him. We’ve gathered articles on the news from SHRM Online<\/em> and other media outlets.<\/p>\n

Changes at Twitter Challenged<\/p>\n

Twitter cut more than 950 California employees after Musk took over, a Worker Adjustment and Retraining Notification Act (WARN) notice showed. In three different California WARN notice letters, signed by Twitter’s human resources department but no executives, the company wrote: “Affected employees will be paid all wages and other benefits to which they are entitled through their date of termination.” Permanent terminations are expected to begin in January 2023, according to the WARN notices.<\/p>\n

Twitter notified affected employees on Nov. 4. Many workers described losing access to e-mail and other internal systems at Twitter overnight on Nov. 3.<\/p>\n

Twitter was sued Nov. 3 by former employees in a proposed class action by those who claimed employees were not given proper notice.<\/p>\n

In total, approximately 3,700 employees were laid off\u2014almost half of Twitter’s staff. Now dozens are reportedly being asked to return as they were laid off “by mistake.”<\/p>\n

(CNBC<\/a>), (TechCrunch+<\/a>) and (Bloomberg<\/a>)<\/p>\n

Avoid Costly Mistakes in Layoffs<\/p>\n

Without careful planning, layoffs can result in costly errors. Avoid common errors some employers make when conducting layoffs. Make time to limit liability. And stay in line with federal, state and local WARN laws.<\/p>\n

(SHRM Online<\/em><\/a>), (SHRM Online<\/em><\/a>) and (SHRM Online<\/em><\/a>)<\/p>\n

Musk’s Schedule Questioned<\/p>\n

In the shareholder’s lawsuit, the compensation package was characterized as unjust because Musk allegedly is a “part-time CEO.” Musk once stated he worked at Tesla Tuesday, Wednesday and Friday, and spent Mondays and Thursdays at SpaceX.<\/p>\n

Tesla has responded by pointing out that the package delivered a 10-fold increase in value to shareholders. <\/p>\n

(CBT News<\/a>)<\/p>\n

‘Minimal Time’ at Tesla<\/p>\n

Tesla’s board chair said the “minimal time” Musk was at Tesla was “becoming more and more problematic” in a 2018 e-mail to the Tesla chief people officer. <\/p>\n

The company has argued the package was not about requiring Musk to punch a clock and be onsite specific hours each week, but to hit “audacious” targets, enriching Musk and shareholders.<\/p>\n

(Reuters<\/a>)<\/p>\n

CEO of Several Companies<\/p>\n

Aside from Tesla, Musk is CEO of SpaceX, the Boring Company and Neuralink. He said on Oct. 31 that he will become CEO of Twitter. <\/p>\n

The 2018 pay package allegedly did not achieve its stated purpose of getting Musk to focus on Tesla. But there were no provisions requiring Musk to devote time or attention to Tesla, nor were there provisions limiting Musk’s allocation of time or attention to other endeavors.<\/p>\n

(TechCrunch+<\/a>) and (Reuters<\/a>)<\/p>\n