Hajra Naz
More than two years after Elon Musk’s dramatic takeover of Twitter (now rebranded as X), thousands of former employees may finally be closer to receiving the severance pay they’ve been fighting for. According to a new court filing, Musk’s company is moving toward settling a class-action lawsuit. The case was brought by an ex-staff member laid off after the $44 billion acquisition.
The filing showed both sides asked the court to delay a hearing. This gives them more time to negotiate and agree on the terms of a possible deal. Details of the settlement remain undisclosed. The case is one of the biggest legal fights tied to Musk’s overhaul of Twitter into X.
When Musk took over Twitter in late 2022, he carried out sweeping layoffs. More than 6,000 employees lost their jobs, cutting the workforce by nearly 80%. At the time, Musk promised three months of severance. The lawsuit claims many workers got only partial payments, or in some cases, nothing at all.
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Former staff argued that Musk’s offer fell short of Twitter’s established 2019 severance plan, which promised senior employees up to six months of base pay plus an additional week of pay per year of service. By comparison, Musk’s proposal represented a significant downgrade.
In July 2025, a U.S. District Judge in San Francisco sided with Musk. The court ruled he was not required to honor Twitter’s old severance agreements after the acquisition. But the plaintiffs appealed the decision. This pushed the case to a higher court. Both sides were set to begin oral arguments next month. Instead, they requested a delay to continue settlement talks.
This lawsuit is only one of many tied to Musk’s leadership of X. Since the acquisition, the company has faced several legal disputes. These include lawsuits over unpaid rent, vendor disagreements, and employee stock compensation.
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For former employees, the outcome of this case could mean long-awaited relief after years of uncertainty. For Musk, a settlement could help close one of the most high-profile legal disputes tied to his turbulent ownership of the platform—though it may also add financial strain as X continues to face questions about its profitability, declining ad revenue, and rising competition from platforms like Meta’s Threads.
As of now, neither X nor the plaintiffs’ representatives have commented publicly on the potential settlement.
