X Demands Fired Employees Repay Severance Overpayments, Threatens Legal Action Post-Elon Musk Layoffs

In yet another controversy, it has been revealed that Elon Musk's social media platform, X, is requesting some former employees in Australia to repay overpaid severance amounts.

The platform, which dismissed approximately 80 per cent of its workforce following Musk's acquisition, is now indicating that a mistake was made in the severance pay calculations for these former employees.

X Demands Fired Employees Repay Severance Overpayments Or Face Legal Action

Legal action has been threatened by the platform against these ex-employees if they fail to comply with the demands. According to a report by The Sydney Morning Herald, several former employees have been contacted by X, some of whom were terminated over 18 months ago, as reported by India Today.

It has been claimed that these individuals were overpaid due to a currency conversion error. The severance amounts in question reportedly range up to $70,000. Legal notices have been received by at least six former employees from X, urging the repayment of the overpaid sums.

Emails reviewed by The Sydney Morning Herald indicate that X's Asia Pacific human resources department acknowledged a "conversion error" and requested the former employees to return the excess amounts to the company, as reported by India Today. The emails stated, "It has come to our attention that you received a significant overpayment in error in January 2023. We would be grateful if you could arrange the repayment to us [using the account details below] at your earliest convenience."

The overpayment issue reportedly stems from the valuation and currency conversion of employee shares at X. When Twitter was acquired by Musk in 2022, Twitter shares were valued at $54.20 each (approximately $82 AUD). An error occurred when the share entitlements were converted into Australian dollars, allegedly using an incorrect conversion rate that was 2.5 times the accurate value, as per the media report. This mistake resulted in higher severance payments being issued to the laid-off employees, ranging from $1,500 to $70,000 per individual.

Despite these requests, none of the former employees have yet complied and returned the money. X has issued warnings that if repayments are not made, the company reserves the right to initiate legal proceedings to recover the overpayments, including interest.

This situation is not the first instance where Musk has encountered issues related to severance payments. Earlier this year, an apology was issued by Musk for the inadequate severance packages provided to employees laid off from Tesla, where he also serves as CEO.

Significant changes have been undertaken by Musk at X, including the layoff of approximately 80 percent of the workforce. Adding to the grievances of former employees, X has recently requested the return of company laptops nearly 18 months after the layoffs. Some ex-employees reported encountering difficulties in their previous attempts to return the devices.