Union workers slam Xbox for offering the ‘bare legal minimum’
Unionized Bethesda Montreal employees have slammed parent company Microsoft for allegedly offering laid off workers the “smallest severance legally possible without bargaining with the union.”
OneBGS, a labor union representing a number of employees at the Fallout and Elder Scrolls maker, claims Microsoft initially told Bethesda Game Studios workers across the U.S. and Canada they would remain employed until September 2026 while the company negotiated severance with the union.
“This at least provided some solace and breathing room,” said OneBGS, whose members have been caught in the 3,200 layoffs announced by Microsoft and Xbox at the beginning of July.
“However, at the end of the day on Friday, July 17, the affected Canadian employees (part of the Fallout and Elder Scrolls teams) received termination letters via email,” added the union in a statement posted on Bluesky.
“This was contrary to what they had been told in the Monday calls. These letters stated that the Canadians are to receive the bare legal minimum in terms of severance: eight weeks of pay in lieu of the minimum legal notice, any outstanding vacation pay, etc. They were to also immediately lose their group benefits health insurance.”
OneBGS said it will fight to secure more for members impacted by the decision.
Speaking to Game Developer, an anonymous source familiar with the situation claimed Xbox is effectively telling workers “if we could give you less we would, but that’s against the law.”
“How do they expect Bethesda’s remaining employees to put in the extra effort needed to make the next Fallout and Elder Scrolls games smash hits?,” they added.
A number of union workers and supporters recently protested Xbox’s fifth round of mass layoffs in three years by hosting ‘Save Our Devs’ rallies outside key Microsoft studios such as id Software and Obsidian Entertainment.
Shortly after, labor unions across the United States and Canada announced they were taking legal action against Microsoft for allegedly mishandling its latest round of cuts.
An unfair labor practice charge (ULP) filed by the Communications Workers of America with the National Labor Relations Board (NLRB) accuses Microsoft of failing to engage in decisional bargaining prior to announcing the layoffs and neglecting to “provide notice and an opportunity to bargain over the removal of bargaining unit work and assigning it to non-bargaining unit positions.”
The ULP was obtained by Game Developer this week and states that Microsoft unlawfully eliminated approximately 435 unionized workers (out of around 1,205 bargaining unit employees) in the six months prior to the charge being filed on July 15, 2026.
“In one fell swoop, these unlawful layoffs eliminated 40 percent of the total number of bargaining unit employees and has created an existential crisis that requires the Board to seek injunctive relief under Section 10(j) of the Act, 29 USC § 160(j), to preserve the status quo between the parties pending full disposition of this case by the Board,” adds the ULP.
Game Developer has reached out to Microsoft for comment.
