A group of Twitter employees has filed a lawsuit against the social media platform, alleging that the company is withholding 2022 performance bonuses despite earlier assurances that employees would receive 50 percent of their target amounts.
According to the lawsuit submitted on Tuesday in federal court in San Francisco, the company has a cash performance bonus structure that is typically paid out on an annual basis. Prior to Elon Musk’s acquisition of Twitter in October, executives, including former Chief Financial Officer Ned Segal, reportedly confirmed that the bonuses would be disbursed.
“Twitter denied bonuses to employees who stayed with the company during the first quarter of 2023,” the lawsuit states.
Since Musk’s takeover, Twitter has faced significant challenges, losing over half of its advertising revenue as advertisers expressed concerns about the platform’s ability to manage harmful content effectively. Additionally, the company has reduced its workforce by more than 75 percent through layoffs and resignations. Users have also reported persistent technical issues, including disruptions during a recent event associated with Florida Governor Ron DeSantis’ presidential campaign launch.
The class-action lawsuit, which represents both current and former employees who did not receive their bonuses in the first quarter of 2023, has been filed by Mark Shobinger. Shobinger served as Twitter’s senior director of compensation until recently, overseeing executive and incentive pay and eventually managing employee compensation globally.
Twitter has dissolved its media relations department and has not responded to requests for comments regarding the lawsuit.
The company has been embroiled in numerous legal disputes since Musk’s takeover, including lawsuits over unpaid bills such as rent, as well as claims from former employees seeking severance and back pay.
Historically, Twitter has established a target for its annual bonus plan, ensuring a minimum payout of 50 percent of the target amount according to the lawsuit’s claims.
“Despite ongoing assurances from management, including before and after Musk’s acquisition, that employees would receive their bonuses for 2022, Twitter ultimately failed to honor these commitments,” the lawsuit asserts.
Following the company’s apparent breach of contract regarding bonus payments, Shobinger has also resigned, filing his own suit against Twitter.
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