• Elon Musk and X Corp have reached a tentative agreement to settle a $500 million lawsuit over severance pay.
• About 6,000 former Twitter employees sued, claiming inadequate severance benefits after layoffs.
• The settlement requires court approval and details are still being finalized.

Elon Musk and his social media company X Corp have reportedly reached a tentative settlement involving a $500 million lawsuit related to severance pay owed to former employees of Twitter. This agreement was announced in a court filing, wherein both parties requested a delay in an upcoming court hearing to finalize the deal. The financial specifics of the agreement have not been disclosed, according to Reuters and BBC.

The lawsuit was initiated by former employees Courtney McMillian and Ronald Cooper, representing about 6,000 sacked workers who alleged they were denied appropriate severance pay under a 2019 severance plan. The plan stipulated severance payment of up to six months' salary for senior employees, whereas laid-off workers received at most one month, or none at all, according to court documents seen by India Times and Anadolu Agency.

The layoffs, which occurred shortly after Musk's acquisition of Twitter in 2022, were part of broader cost-reduction strategies affecting numerous tech firms during that period. The layoffs impacted various departments, including trust and safety, leading to widespread legal repercussions as employees sought the severance benefits they argued were contractually entitled to them. Reuters, BBC, and India Times report that the deal's intricacies will require court supervision to ensure compliance.