Social Media

X, which is owned by a bloke who wants $85bn for building cars, is threatening to sue former Australian Twitter employees because it overpaid them when they were sacked

- June 12, 2024 3 MIN READ
Twitter HQ in San Francisco.
The social media platform formerly known as Twitter is chasing former Australian employees for money and threatening to take them to court after mistakenly overpaying them when they were fired in 2022.

Twitter, now called X by its mercurial owner, Elon Musk, who was forced to buy the platform for $61 billion in mid-2022, went on to shut down its Australian office and purge up to 80% of the company’s staff globally.

But Twitter made a mistake when calculating the payouts on share entitlements for Australian employees. The Sydney Morning Herald reports there was a “conversion error” in calculations from USD to AUD, and the overpayments ranged from $1500 and $70,000.

The SMH has seen emails from X’s Asia Pacific human resources department addressed to at least six former employees saying: “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.”

In seperate correspondence, X has threatened those involved with legal action by Twitter Australia Holdings Pty Ltd to recover the overpayments, “together with interest”

The matter involves employee shares issued to the staff when they joined Twitter, paid as “deferred cash compensation” in the then-publicly listed social media site. The shares were valued at $US54.20 ($82), the price much Musk paid for them in the US$44 billion acquisition when he took the company private. Musk first boasted about buying the business, then tried to back out of the deal and was forced to go through with it following legal action by Twitter’s board at the time.

Speaking of boards, over at Musk’s other day job, Tesla, he’s fighting hard this week for a US$56 billion payday, after a Delaware court ruled Tesla’s board didn’t act “in the best interests” of shareholders when it approved the all-stock pay package in 2018.

In something of an ironic moment for former Twitter employees, the Tesla shareholder who launched the successful legal action over the CEO’s pay, Richard Tornetta, argued that it was an overpayment.

Musk, currently the world’s richest man on the Forbes Billionaires list, with US$206 billion, threatened to relocate the business from the light tax jurisdiction of Delaware to Texas after the ruling. He moved Tesla’s HQ to Austin, Texas, from Palo Alto in 2021 amid a public fight with with health officials over Covid restrictions in California as well as the state’s taxes.

Shareholder this week vote on the Texas move and his compensation package.

Tesla’s Australian chair, Robyn Denholm wrote an open letter, needs the deal to stay motivated and keep his attention“Fairness and respect require that we honor the collective commitment we made to Elon — a commitment that was, and fundamentally still is, about retaining Elon’s attention and motivating him to focus on achieving astonishing growth for our company,” she wrote.It comes after Tesla was forced to recall nearly 4000 Cybertrucks in April for a physical rather than software fix, because the accelerator pedal pad could come loose and get stuck under the interior trim, leaving it stuck at full throttle so the vehicle  accelerated unintentionally.

A US$56 billion pay packet for Musk is equal to Tesla selling 1.37 million of its Model 3 cars at retail. It’s also around 3/4 of 2023’s production levels and around a quarter of the total 5.275 million vehicles Tesla has produced in its 21 years in business.In the first quarter of 2024, Tesla produced 433,371 vehicles and sold 369,783.Musk has been CEO since 2008. He is also the CEO of SpaceX.

We didn’t bother contacting X for comment because they don’t bother getting back to you, but at least they’ve stopped using a poo emoji on the autoreply.

More on The SMH’s Twitter overpayments story here.

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