Soon after reports began of a mass exodus within the social media giant’s ranks, the company announced it would be closing its offices until further notice. No official reason was given, but some reports suggest that the move was due to concerns that departing employees could attempt to somehow sabotage the firm.
The entire affair adds more chaos and confusion to Musk’s tumultuous first few weeks as boss of the company, following his $44billion takeover.
Employment law and HR experts have been reacting to the recent events. Read on to see what they told HR Grapevine.
Philip Richardson, partner and head of employment law at Stephensons, said: “The basic premise of an employment relationship is an implied duty of trust and confidence. If the criticisms regarding Mr. Musk’s working methods are fair and he is placing unreasonable expectations on staff, as well as limiting access to their place of work; that trust and confidence is very quickly going to evaporate. In that circumstance, many employees will feel they have no choice but to resign.
“The situation at Twitter is a prime example of how not to operate a business. A complete failure in employee relations which is having a profound impact on its reputation as a reputable employer. That is something it may never be able to recover from.”
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Much of the drama relates to Twitter’s US operations, but there are many issues that UK staff could be impacted by. In fact, Musk is at risk of “an avalanche of claims” from European employees, according to James Froud, Employment partner at McCarthy Denning.
“This story is extraordinary. One can only assume Mr Musk targeted his ultimatum at staff in the US and other minimal-rights jurisdictions, where ‘at will’ employment prevails. If not, he risks an avalanche of claims from its European workforce”, Froud explained.
“In the UK, employees with two years’ service are protected against unfair dismissal. This means an employer needs both a lawful reason to terminate and to follow a reasonable and proper process to ensure it has a lawful reason. On the face of the reports, it seems unlikely Mr Musk could ‘blue tick’ either requirement. Without these, a dismissal will be unfair, and employees can claim compensation of up to 12 months' salary (subject to a cap of around £95,000). In this context, an offer of 3 months' severance does not look particularly generous or attractive as an option.”
Froud went on: “There are 5 potentially fair reasons for dismissal: redundancy, conduct, capability, illegality, and the catch-all ‘some other substantial reason’ (SOSR). It is difficult to see how sacking employees who don’t sign-up to an “extremely hardcore” culture (with hours to match) can be justified by the first four reasons.
“It isn’t redundancy because the jobs are clearly there to do; it isn’t conduct, because the employees have done nothing wrong; it isn’t performance, because that has yet to be assessed; and there is no concept of softcore employees being illegal. This leaves us with SOSR – and if Elon consulted with lawyers before acting, it is this he will be relying on.
“With all this said, unfair dismissal claims may be the least of Mr Musk’s problems. The requirement to work ‘hardcore’ hours (whatever that actually means) may discriminate against employees who do not work full time, or have childcaring responsibilities, or have disabilities. The potential for claims of indirect sex discrimination, pregnancy and maternity discrimination, disability discrimination, even age discrimination will be clear to see amongst the brethren of employment lawyers.
“It is also worth remembering the Working Time Regulations (derived from the EU Working Time Directive), which are still alive and place a 48-hour limit on average weekly working hours; impose minimal rest periods and minimum holiday requirements. The hardcore regime Musk evokes does not sit comfortably with these requirements, designed to protect employee welfare.
“And what about the wellbeing of those who ‘opt-in’ to the Musk revolution? Employers have a duty of care towards their employees; to provide a safe working environment. The hardcore culture being so publicly thrust upon Twitter looks like a petri-dish for fatigue, burn-out, anxiety and depression. Put another way, it can be seen as a ticking timebomb for discrimination and personal injury claims (amongst others) based on mental health illness. To defend those claims, it won’t be sufficient for Elon to simply point to the day those employees registered their interest for the Twitter 2.0. journey.”