Twitter: A Look at Global Layoffs

Categories: ComplianceGlobal Hiring | Published Date: 23 December 2022

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Since Elon Musk took over the social media platform Twitter on the October 28th, 2022, in one the largest private buyouts to date with a sale price of $44 billion, Twitter’s previous 7,500 staff have seen the workforce decimated by half to a mere 3,400 or so. 

From the US to the UK and India, mass layoff laws vary, and the legalities and best practice of what Elon Musk has done are currently being held to question by leading bodies and governments.

There are two clear stems of discussion here; has Elon Musk acted legally and has he acted ethically?

In what has been one of the biggest publicly covered mass redundancies in recent years, we’re taking a closer look at each step of the development.

The Twitter takeover by Musk

Elon Musk’s takeover of Twitter began slowly. In January 2022, he began purchasing shares in Twitter, eventually becoming the biggest shareholder with a 9.2% stake by April 4th of the same year.

Then, only a day later on April 5th, Elon Musk was invited to join Twitter’s board in a move he initially accepted.

By April 11th, only 6 days later, Musk reversed his decision to join the board, tweeting critically about the company. Later, it would come to pass that Musk had made an unsolicited offer to the board on April 9th to take Twitter private, after rejecting the board seat.

On April 25th, the deal in its entirety was accepted by Twitter, and the conditions of sale, including Musk being prevented from publicly disparaging the company, were agreed. Despite some turmoil in May, with Twitter threatening Musk with court action over bot numbers, the deal was completed and, as of October 28th, Musk is the sole owner and CEO of Twitter.

Global social media, notifications showing on pavement

Twitter global layoffs: what happened

On the week commencing the 31st of October, certain employees began to lose their workplace access, fuelling rumours of mass layoffs. High-profile firings had already happened by this point with the CEO and CFO gone.

Then on November 4th, mass layoffs began. An email was sent to employees stating what would happen next with many employees referring to that Thursday as the ‘layoff-eve’. By 9AM PT, all ‘Tweeps’, the name given to Twitter employees, would know whether they were staying or going. Employees were denied office access and use of internal tools but were still able to communicate via Slack.

By the evening of November 4th, tweets from former employees began to appear on the site. For Twitter users, it was like watching the company unfold in real-time.

By November 5th, Twitter was filled with ex-employees using the #LoveWhereYouWorked and #OneTeam hashtags that had previously been used by the People team to encourage employee advocacy. In total 50% or around 3,700 employees were let go across all countries. 

On November 6th, it was rumoured that some employees let go were asked to return as per internal Slack comments.

November 7th was the first day working on what is being referred to as ‘New Twitter’, and employees who remained with the company began tweeting their experiences of what it was like working with half the prior headcount.

The next major change was November 10th, when Musk emailed all remaining to announce the end of working from home with immediate effect.  In May 2020, Twitter became remote first “forever”, as announced by then CEO and founder, Jack Dorsey. Elon Musk is famed for his dislike of working from home and all his other companies ran with a strong stance on a minimum of 40 hours a week in the office.

The slight issue with Musk’s announcement was the timing. As he announced the change was ‘effective immediately,’ employees in Europe were already midway through their workdays at home.

In Ireland, where there is a serious housing shortage in Dublin, and where Twitter’s European headquarters are, employees were scrambling to find answers, which Musk clarified as ‘if it is not logistically possible… then staying home is fine.”

On November 13th, contractors for Twitter were laid off with no official notice and access was revoked, exactly as how employees were laid off.

Even since November more and more has happened:

Aftermath of the layoffs

While at least one lawsuit is already being pursued  by a group of employees in California over a potential WARN act violation, the bigger ball here is one of compassion. Contrast the way Twitter laid off employees with Meta.

Meta’s note to employees was personally written by Mark Zuckerberg, where he took full accountability for the need to lay people off. He was transparent in the process and gave clear expectations of what the layoffs would mean, as well as how it would work in other countries outside the US.

Contrast with Twitter, where one nameless email with no compassion was sent to all employees.

International employment law concerns

Twitter was a blanket process, with many concerned it violates local employment laws. Outside the US, where employment is at will, laws on collective redundancy  are a lot stricter.

In Ireland, for example, if you are making a certain number of people redundant, you have to go through collective redundancy law. This is a process that’s reflected in UK law as well. Collective redundancy is a process enshrined in Irish law that goes like:

  1. Government must be notified prior to redundancies
  2. Consultation with staff of at least 30 days before anyone is made redundant
  3. Redundancies are then made once the consultation is finished.

In the UK where Twitter employed 281 people from the London office, the process is similar, but with a slight difference:

  1. The government needs to be notified through a HR1 form 30 or 45 days prior to “the first dismissal and before you issue any individual notices of dismissal” or 45 days for 100 or more redundancies at one location, and 30 days for 20-99 redundancies. Twitter is required to comply with the 45-day notice period, it is widely understood.
  2. Employees then submit a representative, sometimes other employees or trade union, representatives
  3. Inform the group about planned redundancies, including information on pay, reasoning, the planned selection process and how redundancies are carried out.
  4. Once the 45-day period is up, only then can you issue notices about termination.

European and UK employment lawyers are already questioning whether what Musk did was legal, as revoking access to systems could be seen as a notice of individual dismissal. This situation is still unfolding at the time of writing.

Managing complex restructuring post-acquisition

Elon Musk is currently finding out that managing a large global company post-acquisition is not easy.

With such a short turnaround between purchase and major layoffs, there are often many considerations to make. With global acquisitions often come restructurings and layoffs, as the new owners work to make the company profitable, focus on a specific business direction or want to strip back to core staff.

However, on a global scale, with large redundancies comes complexity, local hiring compliance and more.

Most European countries, especially EU members, have collective redundancy policies which require certain negotiation periods and notices are given to their governments. It is unclear whether these requirements have been met properly in all affected countries.

For Ghanian Twitter employees, local law says that staff must be paid for redundancy and given three months’ notice. However, according to the BBC, affected Ghanian Twitter employees were only given a month’s notice and their contracts ended on December 4th.

In the US, certain states have their own variation of the federal WARN act with acts such as California’s WARN Act, that mean a certain notice period must be given for mass redundancies along with severance pay requirements. It is unclear whether this has been met, but it is rumoured that compliance has not been followed, as shown by class action lawsuits filed for violation of WARN.  

In Canada, there are similarly strict laws, and you can only lay people off if their contracts specifically allow it.

Essentially, across every country and state where restructuring and layoffs are planned, there are strict requirements to meet. Thorough consultation with local employment lawyers as well as mergers and acquisitions expert consultants, you can help to ensure post-acquisition redundancies and restructurings are handled in a compliant and compassionate manner.

Culture merges with acquisitions

A new boss often means a new approach to work. Whether that’s a new technology process or method of working, after an acquisition or merger, change is inevitable. However, it’s highly recommended to not only look at the necessities, but also the culture post acquisition, and ensure a smooth transition of change.

Twitter, like many Silicon Valley companies, attracted expert and highly-skilled staff because of its incredibly competitive policies and workplace culture. With a remote-first approach, free meals, healthcare, and other advanced workplace policies as well as an emphasis on a work-life balance, Twitter was a fantastic company to work for.

When Elon Musk bought Twitter, many feared the changes he would bring. In his other companies, such as Space X and Tesla, Musk is known as a micromanager (1), (2), (3) who demands nothing but pure dedication from all employees.

His approach to working culture has already led to a lot of concern. Remote working scrapped, the days of rest policy gone, and now rumours of cutting or charging for canteen usage.  In addition, the work-life balance has also gone, especially for those on “Elon-critical projects.”  Twitter employees who have not been made redundant are now facing working at a company that is no longer reminiscent of the place they once worked. Attrition surrounding these changes is expected to be high, and many senior figures have already left.

Will this be the end of Twitter?

Managing companies post M&A

FMP Global has years of experience helping companies of all sizes with compliance, RIF and global restructuring post acquisition. As we head into a period of economic uncertainty across the globe, make sure any changes you make are compliant, compassionate and communicated with our global HR services.

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