Musk, X Agree to Settlement With Fired Twitter Staff

• Aug 22, 2025

Elon Musk and his social media company X have reached a tentative settlement with thousands of former Twitter employees who sued the firm for $500 million in unpaid severance benefits.

The deal was disclosed in a joint court filing on Wednesday, where both parties asked the US Court of Appeals in San Francisco to delay an upcoming hearing while they finalize the paperwork. Details of the settlement remain confidential for now and will require court approval before taking effect.

The dispute dates back to Musk’s takeover of Twitter in 2022, when he launched sweeping cost-cutting measures that saw about 6,000 workers lose their jobs—more than half the company’s workforce at the time. Many of those employees later filed lawsuits, claiming the company failed to honor its severance plan.

The case, led by former employee Courtney McMillian, argued that Twitter staff were entitled to benefits that included up to six months of pay and other compensation. Instead, most workers received only one month of severance, while some reportedly got nothing at all.

According to the lawsuit, the layoffs disproportionately affected teams working in areas such as trust and safety, human rights, and media. Critics said the cuts undermined the platform’s ability to moderate harmful content and maintain its global operations.

The settlement marks a major development in one of the highest-profile legal battles Musk has faced since acquiring the platform, now rebranded as X. While the company has not commented publicly on the case, the agreement suggests both sides wanted to avoid a prolonged legal fight.

The layoffs at Twitter were among the first in a wave of mass job cuts that later spread across the tech industry. Major firms like Meta, Google, and Microsoft also reduced tens of thousands of positions in the years after the pandemic, as companies sought to scale back from rapid hiring during the surge in digital use.

The outcome of this settlement will be closely watched, especially by former employees who have long argued that they were denied fair treatment after Musk’s takeover. For now, they await final court approval to determine what compensation, if any, they will receive.