Unions file unfair labour practice charges against Microsoft following Xbox layoffs
Legal filings in the US and Canada accuse the tech giant of coercive actions and contract repudiation as studio closures and sales reshape the Xbox portfolio.
The Communications Workers of America (CWA) has lodged unfair labour practice charges against Microsoft with the US National Labor Relations Board (NLRB), alleging the company engaged in bad faith bargaining, coercive actions, and contract repudiation. The filing, submitted on July 15, follows a significant restructuring within Microsoft’s Xbox division that saw 1,600 jobs terminated immediately, with a further 1,600 cuts planned for the coming fiscal year.
The layoffs, announced on July 6, impacted staff across Activision, Blizzard, King, Mojang, Xbox Game Studios, and ZeniMax, which encompasses Arkane, Bethesda, id Software, MachineGames, and ZeniMax Online. In addition to the Xbox-specific reductions, Microsoft laid off an additional 3,200 employees outside the division on the same day. The restructuring also included the sale of four studios—Compulsion Games, Double Fine, Ninja Theory, and Undead Labs—and reports indicate the company is considering shutting down Arkane.
CWA Canada is simultaneously pursuing legal action against Microsoft in Canada. Union representatives argue that the abrupt nature of the cuts violates labour standards. Simon Prefontaine, a union organizer and former Bethesda employee, stated that legal counsel in both jurisdictions view the layoffs as illegal, prompting the dual-border filings to seek reinstatement for affected workers.
The charges highlight allegations that Microsoft failed to provide advance notice to employees and neglected union proposals prior to the announcement. CWA District 9 Vice President Frank Arace contended that the company possessed the funds to support its Xbox teams but chose to allocate capital elsewhere, resulting in the loss of creative talent and institutional knowledge. He emphasised that workers would not be treated as disposable assets.
Video game employees began earnest unionisation efforts in late 2021, with Microsoft studios leading the charge in the AAA sector. The CWA represents hundreds of employees at Xbox studios in the US and Canada, covering 3,500 people across the industry. CWA Canada specifically represents Bethesda workers in Montreal, who expressed shock at the lack of transparency regarding the impact on franchises such as Fallout and The Elder Scrolls.
