Elon Musk and his social media platform X have reached a settlement with former staff. The dismissed workers had sued the company for $500 million in unpaid severance.
The deal was disclosed in a court filing on Wednesday. Both sides asked the San Francisco appeals court to delay an upcoming hearing. They said they need time to finalize the paperwork.
Thousands dismissed after Musk takeover
The conflict started after Musk dismissed about 6,000 employees in 2022. That represented more than half of the company’s workforce. Many of those affected challenged the severance terms in court.
Representatives of X and lawyers for the employees have not yet commented on the matter.
Court documents confirmed that both sides had reached a settlement in principle. They also revealed that negotiations for a detailed agreement had begun.
Settlement terms not yet revealed
The conditions of the agreement have not been made public. The courts must approve the final settlement before it takes effect.
Former employee Courtney McMillian led the case against the company. She claimed that thousands of workers were denied the benefits promised in the severance plan.
The lawsuit argued that employees should have received up to six months of pay. Instead, most were offered no more than one month. Some got nothing at all.
Musk’s cuts reshaped the company
The layoffs hit crucial teams including trust and safety, human rights, and media relations. The move became one of the first major job cuts in the wider tech industry’s cost-saving wave.
Other companies soon followed Musk’s example. Facebook, Google, and Microsoft all went on to shed tens of thousands of workers. These decisions came after years of over-hiring during the pandemic’s digital boom.
Musk applied same strategy in government
Earlier this year, Musk briefly led President Donald Trump’s Department of Government Efficiency. The agency was created to reduce spending and cut jobs. Musk used the same approach there, overseeing the dismissal of thousands of federal workers.
