6,000 fired Twitter workers to collect $500 million from Elon Musk in stunning payout

Elon Musk's takeover of Twitter may have been one of the most dramatic events in tech history, but now it is leading to an equally dramatic payout. A new settlement will pay thousands of workers who were fired without severance.

Why did Twitter workers sue Elon Musk?

Recent court filings show that the deal marks a big change in a long-running legal fight over how Elon Musk handled mass layoffs after buying Twitter in 2022. After acquiring Twitter in 2022, Musk rebranded the Blue Bird platform as X and laid off roughly 6,000 workers, or more than half of its workforce.



About 6,000 people who used to work there will now benefit. In a lawsuit brought by former Twitter employees, Musk and his social media business, X Corp., came to a provisional settlement, as quoted in a report by The Independent.


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Court documents stated that "the parties have reached a settlement agreement in principle and began negotiating the terms of a long form settlement agreement on August 19, 2025."

Courtney McMillian, who had been in charge of Twitter's employee benefits programs, and Ronald Cooper, an operations manager, filed the proposed class action lawsuit in California.

What was promised in Twitter's severance plan?

According to their lawsuit, the majority of Twitter workers would receive two months of their base pay and one week of pay for every full year they worked there under a 2019 severance plan, according to Reuters.

However, the lawsuit alleges that many laid-off employees received no further compensation and that Twitter only provided a maximum of one month of severance pay, as quoted in a report by The Independent.

According to the lawsuit, McMillian and other senior staff members were promised six months of base pay.


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About a month before the lawsuit was scheduled to appear before a federal appellate court, the settlement was reached. According to Bloomberg Law, a motion to dismiss the lawsuit was previously granted by a federal judge in California.

Both parties have requested that the appellate court postpone an upcoming hearing because the agreement has been accepted in principle.

According to the filing, "If the district court approves the proposed distribution, the agreement will resolve the litigation in its entirety and moot this appeal."

How did Musk's takeover cause so many people to lose their jobs?

In a dramatic deal, Musk paid $44 billion to acquire Twitter. After agreeing to purchase Twitter in April 2022, Musk announced months later that he would withdraw from the deal. To get the tech tycoon to finish the deal, Twitter even went so far as to sue him, as quoted in a report by The Independent.

According to several reports, Musk closed the deal in October 2022 and promptly started firing top Twitter executives, including then-CEO Parag Agrawal.

The two sides have agreed to the settlement in principle, so they have asked the appellate court to put off the next hearings. If a district court approves the deal, it will officially end the long-running dispute and give former employees the relief they have been waiting for.

For the thousands of workers affected, it represents long overdue compensation after years of uncertainty.

FAQs

Why is Elon Musk giving $500 million to people who used to work for Twitter?
As a lawsuit said that workers were not given the severance pay that Twitter promised in its 2019 plan.

How many workers will the settlement help?
About 6,000 people who used to work for Twitter will get the money.