2,200 arbitration cases have been submitted by former workers of X, the social network formerly known as Twitter, after Elon Musk assumed control of the business, reduced staff, and made other significant changes. For that many cases, the filing fees alone might cost $3.5 million.
The arbitration figures were made public in a new document filed on Monday as a part of a case in a district court in Delaware. Chris Woodfield v. Twitter, X Corp., and Elon Musk (No. 1:23-cv-780-CFC) is the name of the case.
Woodfield, a former senior network engineer who worked at Twitter’s Seattle office, claims in his lawsuit that Musk’s Twitter (now known as X) promised then failed to pay his severance and later delayed the resolution of disputes by failing to pay the required fees required for him to move forward in the JAMS arbitration system.
The filing fee for two-party cases is $2,000, but the employee only has to pay $400 for cases based on agreements or clauses that are necessary as a condition of employment, according to the JAMS website.
Given that JAMS determined that this fundamental price would be uniformly applied to X’s 2,200 arbitration cases, that would come to about $3.5 million, with further fees conceivably to follow.
The company’s legal team has argued that because it did not require workers to address any disputes through arbitration, it shouldn’t be responsible for paying the majority of the filing fees.
In the meantime, Woodfield and others in a like circumstance are attempting to withdraw from arbitration and have their cases taken to court.
Where it is lawful to do so, many large firms force employees to sign an arbitration agreement upon hiring, as CNBC has previously reported. This implies that employees would first need to obtain a judge’s exemption in order to speak freely in court, where their words could end up in the public record.
According to critics, arbitration is a hidden process that makes it more difficult for current employees and potential new hires to see how businesses handle their employees and what happened to individuals in similar cases in the past.
Advocates see arbitration as a fast, effective way for businesses and employees to settle disputes without subjecting them to astronomical legal costs, especially if they lose their case.
The Woodfield case against Musk’s X Corp. is comparable to another proposed class action that was submitted to a federal court in San Francisco.
Ex-employees of the Musk-era Twitter claim that in Ma v. Twitter, in the Northern District of California (No. 3:23-cv-3301), the company delayed at least 891 arbitration cases by failing to pay necessary filing fees after forcing workers to agree to arbitrate their disputes in exchange for severance.