Conversion Error Fallout: Elon Musk’s X Tells Former Staff to Pay Back Severance
This illustration image created on June 12, 2024 in Los Angeles, shows Elon Musk’s campaign launched on X ahead of Tesla shareholders meeting in front of his picture on a screen. (AFP)
X has contacted several former employees, including some who were dismissed over 18 months ago, claiming they were overpaid due to a currency conversion error.
Elon Musk’s social media platform X is demanding repayment from at least six former Australian employees, asserting that they were accidentally overpaid. According to the Sydney Morning Herald, X is threatening legal action to recover these overpayments.
According to the report, X has contacted several former employees, including some who were dismissed over 18 months ago, claiming they were overpaid due to a currency conversion error.
Also Read: Elon Musk To Get Back His Big, $44.9 Billion Tesla Pay Package, Shareholders Give Approval
Since Musk’s acquisition, the platform has laid off around 80 percent of its workforce. It appears that a mistake was made in calculating severance pay for these employees, and now X is reportedly pressuring them to return the excess payments or face potential legal consequences.
The overpayments in severance pay to these former employees range up to $70,000. At least six of these individuals have received legal notices from X, urging them to return the overpaid amounts.
Emails reviewed by The Sydney Morning Herald show that X’s Asia Pacific human resources department acknowledged the “conversion error” and requested that the former employees repay the excess amounts to the company.
The email stated, “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.”
Reason Of Overpayment
As per the report, the overpayment issue reportedly stems from the valuation and currency conversion of employee shares.
When Musk acquired Twitter in 2022, Twitter shares were valued at $54.20 each (approximately AUD 82). The error occurred when X converted the share entitlements into Australian dollars, allegedly using a conversion rate that was 2.5 times the correct value.
This mistake led the company to overpay severance amounts to the laid-off employees, with individual overpayments ranging from $1,500 to $70,000.
‘Yet To Complied’
Reportedly, none of the former employees have complied with the requests to return the money. X has warned that if repayments are not made, legal proceedings will be initiated to recover the overpayments, including interest.
Elon Musk to Get Back His Big, USD 44.9 Billion Tesla Pay Package
Tesla shareholders voted on Thursday to restore CEO Elon Musk’s record USD 44.9 billion pay package that was thrown out by a Delaware judge earlier this year, sending a strong vote of confidence in his leadership of the world’s largest electric vehicle maker.
The favourable vote doesn’t necessarily mean that Musk will get the all-stock compensation anytime soon. The package is likely to remain tied up in the Delaware Chancery Court and Supreme Court for months as Tesla tries to overturn the Delaware judge’s rejection.
