Elon Musk Denies News Report On Sacking Twitter Employees' To Avoid Payouts
The NYT reported that Elon Musk has ordered job cuts before November 1 when Twitter employees were scheduled to receive stock grants as part of their compensation
Tesla Chief Executive Officer (CEO) Elon Musk, the new owner of Twitter, has denied a report by New York Times about laying off Twitter employees at a date earlier than November 1 to avoid stock grants due on the day, reported Reuters
In a response to a Twitter user asking about the layoffs, Musk tweeted: "This is false."
This is fake – I did *not* tweet out a link to The New York Times! pic.twitter.com/d6V6m5ATW2
— Elon Musk (@elonmusk) October 31, 2022
The New York Times (NYT) on Saturday said that Musk has ordered job cuts across the company, with some teams to be trimmed more than others and that layoffs would take place before November 1 date, when employees were scheduled to receive stock grants as part of their compensation. Citing sources privy to the matter, the Times reported the cuts could begin as soon as Saturday.
Musk fired top executives in an effort to avoid hefty severance payouts, while lining up other layoffs as soon as Saturday. He fired Twitter Chief Executive Parag Agrawal, Chief Financial Officer Ned Segal, and Legal Affairs and Policy Chief Vijaya Gadde on completion of a high-profile $44 billion buyout of the social media platform on Thursday.
The world's richest man had accused them of misleading him and Twitter investors over the number of fake accounts on the platform. According to research firm Equilar, the executives stood to receive separation payouts totalling some $122 million.
Citing sources familiar with the matter, the Information reported that Elon Musk terminated four top Twitter executives, including Agrawal and Segal "for cause," in an apparent effort to avoid severance pay and unvested stock awards. In a tweet on Saturday, LightShed analyst Rich Greenfield said Musk fired top Twitter execs "for cause," preventing their unvested stock from vesting as part of a change of control.
However, Twitter did not immediately respond to Reuters' request for comment.
According to Reuters, director of research at Equilar Courtney Yu on Friday said that the fired executives "should be getting these (severance) payments unless Elon Musk had cause for termination, with cause in these cases usually being that they broke the law or violated company policy."
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