I am going to begin this blog in a slightly unorthodox way, with a thought experiment…close your eyes and imagine that Twitter and its infamous CEO were conducting business from the cooler shores of the United Kingdom (and not in sunny San Francisco where the company is actually based). Imagine for a second that Mr Musk’s recent escapades had all happened in the United Kingdom (“UK”). What would that be like? And more importantly, (for our purposes at least) what implications would it have for the Twitter employees?
For those of you who have yet to see the latest updates on Twitter and Mr Musk’s recent ultimatum to its staff, on 16 November 2022, it was leaked that the CEO had told staff of the social media giant to “be[come] extremely hardcore” or leave the organisation. The email was sent on the morning of Wednesday 16 November and employees were given until 5pm on 17 November to decide if they were going to stay (on the proviso of becoming extremely hardcore). The CEO continued, in his midnight email, that “this will mean working long hours at high intensity”. He also threatened that “only exceptional performance will constitute a passing grade”. If employees did not accept the ultimatum, they would be offered severance packages with 3 months’ pay.
The email to staff was released just a few hours after the CEO tweeted that he would be postponing Twitter’s Blue Verified. Blue Verified is Mr Musk’s first major product since taking over as Twitter’s CEO and financial owner around a month ago. Since the acquisition took place, Twitter has reportedly lost more than a million users and is losing around $4 million a day.
Clearly the CEO is taking drastic measures in an attempt to cover the Company’s losses, but how would this situation play out if it had happened in the UK?*
- First and foremost, the actions of Mr Musk run a serious risk of breaching the implied term of trust and confidence in the employees’ contracts. Naturally, an employer should consult with staff about impending variations of contract (such as to working hours), and issuing an ultimatum would contravene best practice (and amount to a breach of contract) leading to potential constructive dismissal claims. In the UK, providing they have more than 2 years’ service with Twitter, the employees would be entitled to terminate their contract without notice and bring such a claim. They would also be able to bring a wrongful dismissal claim in respect of their notice pay. If this were to happen en-mass, the financial implications for Mr Musk would be substantial. Additionally, if Mr Musk were to carry out his threat that “only exceptional performance will constitute a passing grade” and dismiss staff on this basis, affected employees (with two years’ service or more) would have the option of bringing an unfair dismissal claim, as it is highly unlikely that a failure to work without complete exceptionalism, would justify a fair dismissal on the grounds of capability.
- Secondly, the request that Mr Musk makes of all employees to work “long hours at high intensity” in order to continue in their occupation, may very well amount to indirect sex discrimination. Enforcing this type of policy is likely to disproportionately impact women with children, over their male counterparts. Whilst the playing field is definitely shifting in this regard, with more shared parental responsibility, the requirement to work long office hours may be more likely to affect women with children, who have to balance child care commitments alongside work.
- Thirdly, and again speaking to Musk’s request that employees work “long hours at high intensity”, if those long hours were to amount to more than 48 hours a week, it would be a breach of the Working Time Directive. A breach of the Working Time Directive (where an employee has not opted out of the Directive) can entitle an employee to bring a claim for automatic unfair dismissal under s104 Employment Rights Act 1996, if they are instructed to infringe their statutory rights, even if the infringement has not actually occurred. The EAT confirmed this recently in the case of Simoes v De Sede UK Ltd.
- Fourthly, Mr Musk’s requests may also amount to a breach of the Health and Safety at Work Act 1974, in that they cause the work environment to be potentially unsafe. Section 2 (e) of that Act confirms that employers have a duty to secure the “provision and maintenance of a working environment… so far as is reasonably practicable, safe, without risks to health, and adequate as regards facilities and arrangements for their welfare at work.” Arguably, making people come into the office and work extremely long hours at a high intensity could breach this provision; it is also likely to be detrimental to an employee’s welfare. A breach of the provisions is a criminal offence punishable by a fine or imprisonment, or both.
In summary, while Mr Musk is known for running his companies with extreme cultures, should this kind of leadership happen in the UK, it is not without significant litigation risk. Here, at Thomas Mansfield, we would advise employers against making knee jerk decisions in regard to staff, even when business may not be prospering. Ill-thought-out decisions, as discussed here, could end up being very costly for a business. As the old adage goes – “act in haste – repent at leisure.”
*Twitter employees based in the UK would have these rights, but we do not have information on whether or not the email was sent to employees in the UK.