When Michelle Armstrong joined Twitter in April 2022, she thought she had found her dream job.
After a decade in the tech industry, with its reputation for “tech bro” sexism, working as a senior audiovisual engineer for the social media giant felt different.
“I’ve had so much discrimination from different jobs,” Armstrong said. “Twitter was the place I felt welcome, where they valued my expertise.”
Then, on Nov. 4, Armstrong got notice: She was being laid off in the wake of Elon Musk’s takeover of the company. Two months later, she received its now-infamous severance offer—a month’s pay, contingent on signing a lifetime agreement not to sue Twitter, not to testify in cases against the company and to assist it with litigation, and not to disparage the bird app or Musk.
At 53 years old, Armstrong fears finding another job won’t be easy: “I’m dipping into my retirement funds now, and it’s scary,” she said.
Beyond that, Armstrong says her final payment miscalculated deductions and compensation for expenses. The complicated legal document also included language threatening consequences for violating its provisions before the separation date—even though Armstrong had not received the agreement during that period.
“Right away, I knew this wasn’t something I was going to sign,” Armstrong said.
Instead, she lawyered up and plans to take Twitter to arbitration. She’s not the only one.
Armstrong’s attorney, labor lawyer Shannon Liss-Riordan, has four class action suits and roughly 300 demands for arbitration on behalf of former Twitter employees. Another prominent attorney, Lisa Bloom, has fielded 60 arbitration cases and counting against the company. There will likely be more.
As Musk moves to pare down Twitter’s expenses, employees have borne the brunt of that cost-cutting: Several thousand workers—both full-time employees and contractors—have lost their jobs. And the lawsuits and expensive arbitration cases against Twitter are piling up.
“I don’t think they have a good hand,” Liss-Riordan said of the company.
Twitter and Musk did not respond to requests for comment.
Battle for Benefits
Sometimes a tech layoff isn’t just a layoff.
That’s what Liss-Riordan alleges in class action suits she has filed against Twitter. Those cases claim that the company committed breach of contract in laying off employees, firing some supposedly for cause and terminating others who refused to sign onto Musk’s unusual ultimatum that they go “extremely hardcore” in their work for the company.
The lawsuits also claim that Twitter terminated employees who were on medical or parental leave and discriminated against women, who made up the majority of those laid off.
But most of the cases are in arbitration because the employees’ contracts required them to renounce their rights to bring the company to court. While employees could sometimes opt out of this arbitration clause, most were unaware and did not.
Broadly, Liss-Riordan is claiming that everybody who lost their job at Twitter since Musk took over is entitled to the severance that was promised to them by the previous management in addition to 60 days notice under the WARN Act.
Before Musk took over, Twitter repeatedly promised its employees, both orally and in writing, at least two months base pay, three months equity vesting after the separation date, and bonuses and health care contributions, according to Liss-Riordan. Musk also tweeted that employees would receive three months of severance pay.
Regarding Twitter’s reduction in force, unfortunately there is no choice when the company is losing over $4M/day.— Elon Musk (@elonmusk) November 4, 2022
Everyone exited was offered 3 months of severance, which is 50% more than legally required.
Part of the dispute is whether Twitter included a 60-day WARN period in severance agreements that were mailed to employees at the beginning of the year. The company also isn’t giving the ex-employees their prorated bonuses—which many tech workers count on as part of their compensation, says Bloom.
Several of Bloom’s arbitration cases also involve alleged discrimination against people who refused to opt into Musk’s “hardcore ultimatum” because they have disabilities or are parents of young children, which would prevent them from working the kind of long hours he demanded.
It’s not the first time Bloom has tangled with a Musk company, having previously represented a client in a sexual harassment suit against Tesla.
She says that the mercurial billionaire often shoots from the hip and lets the lawyers clean up afterward.
“Ultimately, the law catches up,” Bloom told The Standard. “It’s the year 2023 now, and the law protects people, even against the richest man in the world.”
Hope Amid Chaos
Helen-Sage Lee was among those who wound up contacting Bloom after abruptly losing her job.
As a program manager for the Account Integrity team at Twitter, Lee was working late on the night of Nov. 3 helping to prevent manipulation and interference in the 2022 midterm elections. As she was getting ready to end her shift, she received a mass email informing employees that they would find out about layoffs the next day.
A few hours later, Lee lost access to the company VPN and email server. That’s when she knew she was out.
“For me, it was a lot of chaos. It was a lot of anxiety,” she said.
When Lee received her severance offer on Monday, it once again threw her world into disarray: She’d budgeted thinking that she’d get the severance previously promised at the company.
That promise “helped a lot of us who very much felt that we were aligned with the mission of serving the public conversation and felt passionate about working for Twitter,” she told The Standard.
During Musk’s acquisition of Twitter, Lee had decided to stay on even as many of her colleagues resigned amid rumors of a dramatic shake-up.
“I had relied on this promise to my detriment,” she said.
But after she came across tweets by Bloom about the possibility of a legal remedy, she says it gave her hope. She joined Bloom as a client.
Both Liss-Riordan and Bloom say they’re confident in their clients’ cases—but not everyone agrees they have a strong hand.
Dhaivat Shah, a partner at Silicon Valley-focused law firm Grellas Shah, believes that—despite the unusual circumstances around Twitter— former employees face a “steep uphill battle” to win more severance.
Employers do not have an obligation by law to provide severance, and the legal issue in question will be whether Musk’s promises actually hurt employees.
“The company or Mr. Musk saying that they will offer a certain amount of severance is not a legal contract. So how were these employees harmed by relying on that promise?” Shah asks. “Assuming that it can be really shown that it was a promise at all.”
The demands that the former employees not disparage the company and serve as witnesses in litigation against it aren’t as outlandish as they sound, says Mariko Paul, assistant general counsel to Engage PEO, a company that provides HR services to small and midsize businesses.
These types of clauses are common, and have their limitations: California law states that companies cannot prevent their employees from disclosing facts about unlawful activities in the workplace, such as sex discrimination.
There is, however, one way that almost everyone agrees the lawsuits could be effective: Arbitration is expensive. And that could prove too high a cost for a company that’s reportedly refusing to pay rent and other obligations.
Twitter likely employed the arbitration clauses to protect itself from class action lawsuits. But in order for such clauses to be legally enforceable, Twitter needs to foot the bill, Shah said.
Faced with masses of expensive arbitration cases—the kinds that Liss-Riordan has pioneered—Twitter might simply choose to settle with its employees.
Shah describes this situation, where a company’s preferred path of arbitration becomes too burdensome financially, as a “be careful what you wish for" scenario.
As for Armstrong, she says money isn’t whats driving her to pursue arbitration.
“I wasn’t one of the people making $200,000 a year there. My position was a lot lower-level,” she said. “It’s more about the principle.”