A group of employees at Twitter has filed a lawsuit against the social media company, alleging that it has failed to honour its commitment to pay out 2022 bonuses. Despite promises that these bonuses would be paid at 50 per cent of the target amounts, Twitter has allegedly refused to do so, according to the lawsuit filed in a San Francisco federal court, as reported by Bloomberg. The lawsuit claims that Twitter operates an annual cash performance bonus plan that was scheduled to be distributed before Elon Musk's acquisition of the company in October.
The employees assert that executives, including former Chief Financial Officer Ned Segal, assured them that the bonuses would indeed be paid out. However, Twitter allegedly reneged on its promise and declined to provide bonuses to employees who remained with the company during the first quarter of 2023.
Since Musk's acquisition, Twitter has encountered significant challenges. The platform has experienced a decline in advertising revenue, losing more than half of its income, as brands have expressed concerns about the site's ability to effectively remove violent, pornographic, and hateful content. Twitter has also witnessed a substantial reduction in its workforce, with over 75 per cent of employees being laid off or resigning. Technical difficulties have further plagued the platform, such as during the recent launch of Florida Governor Ron DeSantis' presidential campaign.
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The lawsuit, filed as a proposed class-action complaint, represents current and former Twitter employees who worked during the first quarter of 2023 and were denied their bonuses. The complaint was brought forth by Mark Shobinger, Twitter's former senior director of compensation, responsible for overseeing executive and incentive pay, as well as employee compensation globally.
Twitter's media relations department has been dissolved, and the company is not responding to requests for comment regarding the lawsuit or other matters. Since Musk's acquisition, Twitter has faced multiple legal actions alleging non-payment of bills, including rent, as well as lawsuits from former employees seeking severance and back pay.
According to the lawsuit, Twitter typically establishes a target for its bonus plan, which is funded throughout the year and pays out at least 50 per cent of the target on an annual basis. The employees assert that Twitter's management, both before and after Musk's acquisition, consistently assured them that their 2022 annual bonuses would be granted in accordance with the Bonus Plan.
Due to Twitter's failure to fulfil its various commitments to employees, including the refusal to pay bonuses, Shobinger claims he resigned from his position. He has filed a lawsuit citing breach of contract.
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