In this photo illustration, the new Twitter logo, renamed X (X Corp.), is displayed on a smartphone and the Elon Musk Twitter account, while a computer screen The new X logo is displayed on it.
Pavlo Gonchar | Light Rocket | Getty Images
Social network X, formerly known as Twitter, is facing 2,200 arbitration cases brought by former employees after Elon Musk took over the company, cutting headcount and making other sweeping changes. Filing fees for such cases alone can reach $3.5 million.
The arbitration number is disclosed in new record Monday, as part of a lawsuit in Delaware District Court. The case is Chris Woodfield v. Twitter, X Corp., and Elon Musk (No. 1:23-cv-780-CFC).
Woodfield, a former senior network engineer who worked at Twitter’s Seattle office, alleges in the lawsuit that Musk’s Twitter, now called X, promised but failed to pay his severance package and later shut down for failing to pay the necessary fees. Delayed alternative dispute resolution. His fees to proceed in the JAMS arbitration system.
According to the site jam“For two-party matters, the filing fee is $2,000,” “For matters based on a term or agreement as a condition of employment, the employee pays only $400.”
If JAMS decides that this base fee applies across the board to X’s 2,200 arbitrations, the amount would be approximately $3.5 million, with possible additional fees.
Lawyers for the company argued that it did not require employees to resolve any issues through arbitration, so it should not bear most of the filing fees.
Meanwhile, Woodfield and others in similar situations are trying to get out of arbitration and move their cases to trial.
As CNBC previously reported, many large companies require employees to sign arbitration agreements upon hiring, as long as doing so is legal. That means for workers to speak freely in court, where their words can become part of the public record, they first need immunity from a judge.
Critics see arbitration as a secretive system that makes it harder for employees and future hires to learn how companies treat employees and what happened to people in previous related cases.
Proponents see arbitration as a way for companies and employees to effectively resolve issues without exposing employees to huge legal fees, especially if they lose the case.
In Jack Ma v. Twitter, Northern District of California (No. 3:23-cv-3301), former Musk-era Twitter employees allege that the company delayed at least 891 arbitration cases for failing to pay required fees. Applying fees after forcing employees to agree to arbitrate their disputes in exchange for severance pay.