Elon Musk and the on-going Twitter Controversy

17 November 2022

As Elon Musk enters his fourth week as CEO of Twitter, the controversy surrounding his decision making seems never ending. Continuing mass layoffs, apprehension surrounding the financial future of the platform, and concerns surrounding censorship and Human Rights are just some of the issues that have arisen since the takeover.

Mass-redundancies: After only one week as CEO, Musk made around 3,700 employees redundant (around half of the workforce), and this included the entire Human Rights, machine learning and algorithmic ethics teams. A company-wide memo was issued to employees confirming that they would receive an email to their personal account if they were being made redundant. Prior to this memo, employees were aware that they had been made redundant as they no longer had access to the workplace systems and their computers.

There has been little detail provided as to how these redundancies came about, however an indication was provided when Musk revealed via a tweet that there had been a “massive drop in revenue” as the Company was losing £4 million a day, thus meaning that “bankruptcy was not out of the question”.

The redundancies have been widespread and individuals in the UK have also been affected; however, due to UK legislation employees are required to be formally consulted and taken through a full and thorough redundancy process. Whether this will happen remains to be seen, however issues have already started to arise as UK employees state that they were informed via email on Saturday that they would be taken through formal consultation and had until 9am on Tuesday to nominate staff representatives.

Further concerns have been mounting, with companies such as General Motors, Audi and Pfizer all halting advertisements on Twitter, amid concerns surrounding Musk’s decisions to make the entire Human Rights Team redundant, which has led to reasonable concerns surrounding misinformation and security protections. This decision also led to the United Nations’ Human Rights Chief to write to Musk asking him to “keep the protection of free speech, prevention of hate and violence and effective content moderation in non-English languages at front and centre”.

Home-working arrangements: The controversy at Twitter hasn’t just been surrounding the mass redundancies, but also the end of remote working. On 27 October 2022, Musk sent an email to all employees confirming that they would no longer be permitted to work remotely, and would be expected to be in the office for a minimum of 40 hours per week, unless given approval to work elsewhere.

Days after this memo was issued, Musk confirmed that the company “days of rest” which was previously implemented by Jack Dorsey, the previous cofounder, had been removed from all employees’ calendars. Whilst this was a significant change for existing Twitter employees, when looking at Musk’s other companies such as Tesla and SpaceX this does not seem too uncommon with long hours and limited flexibility being the “normal”.

Legal action: Twitter is now facing a class-action lawsuit from former employees who state that they were not given enough notice in accordance with the US federal law, and that they had only found out they were made redundant when locked out of their work computers and systems. The lawsuit is seeking orders for Twitter to comply with the federal worker Adjustment and Retraining Notification Act, which requires employees to be given 60 days’ notice for mass sackings by large companies. Whilst this is currently ongoing under federal law and therefore does not apply to the Law of England and Wales, Musk would need to alter his approach substantially so that he is acting lawfully in accordance with UK law and to avoid any potentially any future litigation in the Employment Tribunal.

What to do if you need to make redundancies within your business in the UK?

Firstly, employers must be able to establish that there is a genuine need for redundancy and demonstrate that the role/s at risk are no longer needed/exist. We strongly advise against taking the same approach as Elon Musk and instead recommend employers abide by employment legislation and entering into meaningful consultation with all affected employees. Whilst the legal obligations surrounding how this consultation is carried out does change based on the number of redundancies being made, there are certain rights that all employees do possess during a redundancy situation and these include: being entitled to reasonable time off to seek alternative employment or arrange training; and to not be unfairly selected for redundancy. For those employees with over two years’ service, they would also be entitled to redundancy pay.

If you are looking to make redundancies, we recommend making contact with our specialist Employment Law Team who will be able to provide timely and proactive legal advice. Alternatively, if you are an employee who has been made redundant unfairly, you can contact our team.

The contents of this article are intended for general information purposes only and shall not be deemed to be, or constitute legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.