Elon Musk X Faces Lawsuit For Allegedly Withholding Staff Bonuses
A federal judge has determined that X, must face a lawsuit brought forth by employees who allege that the company failed to fulfill promised bonuses.
The accusations disclosed that X, after its acquisition by billionaire Elon Musk in October 2022, failed to pay annual bonuses to its staff, contrary to assurances made by executives both before and after the acquisition.
The lawsuit, filed in June 2023 by Mark Schobinger, a former senior director of compensation at X, seeks a class-action suit on behalf of former and current X employees who did not receive their 2022 bonuses.
In a ruling on Friday, US District Judge Vince Chhabria said, “Twitter’s offer to pay him a bonus in return became a binding contract under California law.
The complaint added that, in the period leading up to Musk’s acquisition of X, company executives constantly promised employees that 2022 bonuses would be disbursed at 50% of the target.
These promises were reiterated even after Musk’s acquisition was completed.
Despite these promises, X allegedly failed to fulfill the promised bonuses, leading to the lawsuit.
