Here’s what you need to know about the Twitter layoffs and what they mean for you:
Why is Twitter laying off so many employees?
Musk has said Twitter’s workforce was too large and placed too much emphasis on content moderation, platform safety, product development and marketing.
But in buying out Twitter’s shareholders, Musk paid $44 billion for a company that lost $221 million last fiscal year. To service the debt needed for the transaction, Twitter needs to boost its profit margins, said Josh White, an assistant professor of finance at Vanderbilt University.
Trimming labor costs could be one way to achieve that. Cuts to infrastructure could be another. In messages to engineers this week, managers asked workers to suggest ways to find at least $500 million in annual cuts across the company, The Washington Post reported. The cuts would include data centers and other software infrastructure needed to run the site, as well as targeting the contract workforce that performs content moderation for Twitter.
Musk on Friday morning tweeted that the company’s top source of revenue, advertising, has faced a sharp decline since his takeover.
How many employees have been laid off from Twitter?
It’s not clear what the final number of layoffs will be, but people familiar with Musk’s plans told The Post that close to 50 percent of the company’s staff will be dismissed. Those people spoke on the condition of anonymity out of fear of professional reprisals.
The Friday layoffs were expected to target the sales, trust and safety, marketing, product, engineering and legal divisions.
In one of Musk’s first moves as Twitter’s majority shareholder, he fired some of the company’s top executives, including the CEO, chief financial officer and general counsel.
How will the layoffs affect Twitter?
Experts — and now-former Twitter employees — say the sharp reduction in personnel could have wide-ranging consequences for the platform, especially ahead of the midterm elections.
Drastic cuts to infrastructure spending could make the site vulnerable to technical glitches or hacks, former workers have warned. Reduced staffing in content moderation teams could make the company less responsive to the rise in racist, transphobic and antisemitic posts that have exploded since Musk’s takeover was finalized.
But beyond the staff reduction itself, the dizzying confusion and plummeting morale within Twitter’s workforce have real effects, too. Musk and other top executives have been mum even internally about the scale of the layoffs and employees’ new responsibilities. There’s often a delay between when a fired worker’s internal accounts for communication — like email and Slack — are deactivated and when they are removed from the company’s internal directory. Reporting structures have been completely altered.
That has created a huge communication void both within Twitter’s staff and between Twitter officials and certain users — such as local election officials, accounts subject to constant harassment, media companies, advertisers and more.
Certain departments have been eliminated entirely, such as Twitter’s “ethical AI” team, Wired reported. Employees from the company’s human rights section tweeted that the whole division — which monitored content to protect individuals during global conflicts and crises — was laid off.
Twitter’s ad sales department appeared to be less affected than other departments, according to an employee who spoke on the condition of anonymity. Twitter relies on ad revenue, and its sales force works to bring in new advertisers.
Why are employees suing Twitter over the layoffs?
Five former Twitter employees filed a class-action lawsuit Thursday claiming that the company violated federal and state laws by proceeding with massive layoffs without warning workers first.
The Worker Adjustment and Retraining Notification (WARN) Act requires employers who are engaging in large-scale layoffs to notify workers and state and local governments 60 days ahead of the job cuts. It is designed to give workers time to search for new employment, adjust household budgets, train in new skills, or learn how to apply for unemployment insurance.
The former Twitter employees argue that the company did not provide such notification; laid-off staffers were informed Thursday night and into Friday that they would be placed on 60- or 90-day “non-working notice” (some states require longer advance notification periods). That means they will still be considered employees at Twitter and receive 60 or 90 days of compensation and benefits, but cannot perform any work.
That approach, called “pay in place of notice,” violates the WARN Act, according to the Labor Department. But the remedy is simple: Pay employees the 60- or 90-day compensation they would otherwise earn. Twitter has committed to doing that, said Kate Bronfenbrenner, director of labor education research at Cornell University’s School of Industrial and Labor Relations.
“It seems sneaky and fishy and wrong,” she said, “I just don’t know that the WARN Act is the law that would keep them from doing it.”
What are the details of Twitter’s severance package for laid-off workers?
Musk said the company offered three months of severance pay to everyone laid off. Emails to former staffers obtained by The Post told recipients, “Within a week, you will receive details of your severance offer, financial resources extending beyond your non-working notice period.” That will be accompanied by a formal separation agreement, a claim release — an agreement that employees will drop or not pursue legal complaints against Twitter — and instructions on how to return company equipment such as laptops and ID badges.
Which companies have stopped advertising on Twitter?
A broad international cross-section of major corporations have pulled their advertisements, or at least paused ad campaigns. They include:
- Automakers Ford, General Motors and Volkswagen, including its Audi brand
- Cereal and snack companies General Mills and Mondelez, the corporation behind Oreos, Ritz crackers, Sour Patch Kids and others
- Pharmaceutical giant Pfizer
- United Airlines
- International ad and consulting firm Interpublic, which represents American Express, Coca-Cola, Fitbit, Spotify and dozens of other major corporations
Activists are seeking to apply pressure to other companies to cut off their ad buys on Twitter until Musk reins in spreading hate speech and conspiracy theories. After meeting with Musk, NAACP President Derrick Johnson on Friday called on advertisers to abandon Twitter.
“When we met with Elon Musk, he made commitments that gave us cautious optimism, but until actions are taken to make Twitter a safe space, corporations cannot in good conscience put their money behind Twitter,” Johnson said in a statement. “Twitter must earn its advertisers by creating a platform that safeguards our democracy and rids itself of any content or account that spews hate and disinformation.”
