More than two years after being laid off, some former Twitter employees may finally see their severance pay, as Elon Musk’s X appears to be tentatively settling a class-action lawsuit filed by workers who were dismissed shortly after Musk acquired the social media platform.
The potential settlement was revealed in a recent court filing, where both parties requested a delay of an upcoming hearing to negotiate terms of the deal. While details of the agreement remain private, it signals a possible resolution to one of the largest employment disputes stemming from Musk’s 2022 purchase of Twitter.
Following the acquisition, Musk laid off over 6,000 employees, slashing Twitter’s workforce by roughly 80%. At the time, he offered departing employees three months’ severance, but the lawsuit claims that many workers either did not receive full payments or received nothing at all. Former employees argued that the offered severance was below expectations, citing a Twitter severance plan in place since 2019. Under that plan, senior employees could have been entitled to up to six months’ base pay, plus one week of pay per year of service, making the shortfall particularly significant for longer-tenured staff.
The case saw a major legal development in July 2025, when a U.S. District Judge in San Francisco ruled that Musk was not obligated to honor the prior Twitter severance agreements. The plaintiffs quickly appealed, setting the stage for oral arguments in the court of appeals scheduled for next month. The recent filing requesting a hearing delay indicates that both sides are actively exploring a settlement that could resolve the dispute without further litigation.
If finalized, the settlement could total around $500 million, providing financial relief to a workforce that has waited over two years for compensation. Beyond the monetary impact, the case highlights ongoing tensions surrounding employee rights, severance obligations, and corporate governance in the wake of high-profile tech acquisitions.
As Musk and X move closer to potentially closing this chapter, former Twitter employees and investors alike will be watching closely to see how the settlement shapes perceptions of Musk’s management style and the company’s approach to labor relations.
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