A lawsuit has been filed by Twitter employees against the social media company, alleging that it has failed to fulfill its promise of paying out 2022 bonuses at 50 percent of the target amounts.
The employees claim that prior to Elon Musk’s acquisition of the company in October, executives, including former Chief Financial Officer Ned Segal, had assured them that the bonuses would be disbursed. The lawsuit was filed on Tuesday in the federal court of San Francisco.
The employees assert that Twitter has refused to provide any bonuses to those who remained employed by the company in the first quarter of 2023.
Following Elon Musk’s takeover, Twitter has faced significant challenges, including a substantial decline in advertising revenue, which has plummeted by over 50 percent. This decline can be attributed to brands losing confidence in Twitter’s ability to effectively remove violent, pornographic, and hateful content from its platform.
Additionally, the company has experienced a significant reduction in its workforce, with more than 75 percent of employees leaving due to layoffs and voluntary resignations. Technical difficulties have also plagued the site, including issues during the recent launch of Florida Governor Ron DeSantis’ presidential campaign, causing further disruptions and concerns.
The class-action complaint, representing current and former Twitter employees who were employed in the first quarter of 2023 and did not receive their bonuses, was filed by Mark Shobinger. Shobinger previously held the position of senior director of compensation at Twitter until recently. His role involved managing executive and incentive pay, and in November, his responsibilities expanded to include global employee compensation, as stated in the lawsuit.
It is worth noting that Twitter has disbanded its media relations department and has chosen not to provide comments or respond to requests for comment regarding the matter.
Since Elon Musk’s acquisition, Twitter has faced multiple lawsuits alleging failure to fulfill financial obligations, such as unpaid bills, including rent, as well as claims from former employees seeking severance and back pay.
According to the lawsuit, Twitter has traditionally established a target for its bonus plan, which is funded throughout the year and typically pays out a minimum of 50 percent of the set target on an annual basis.
The employees stated in the lawsuit that both before and after Musk’s acquisition was finalized in October 2022, Twitter’s management consistently assured the company’s employees, including the plaintiff, that their 2022 annual bonuses would be granted according to the Bonus Plan.
Due to Twitter’s failure to fulfill various commitments to its employees, including the refusal to pay out bonuses, Mark Shobinger chose to resign. He subsequently filed a breach of contract lawsuit against the company.
