The Communications Workers of America (CWA) has filed unfair labor practice charges against Microsoft with the National Labor Relations Board (NLRB), accusing the tech giant of bad faith bargaining, coercive actions, contract repudiation, and failing to provide notice to employees during a sweeping round of Xbox layoffs.
The charges, filed on July 15, allege that Microsoft violated federal labor law in its handling of the mass layoffs that hit its video game division earlier this month. CWA Canada has also initiated separate legal action against Microsoft, according to reports from Game Developer.
Massive Layoffs Across Xbox Studios
On July 6, Microsoft announced plans to cut 1,600 jobs immediately across its Xbox division, with an additional 1,600 positions slated for elimination over the coming fiscal year. The layoffs affected studios across the board — including Activision, Blizzard, King, Mojang, Xbox Game Studios, and ZeniMax Media, which encompasses Arkane, Bethesda, id Software, MachineGames, and ZeniMax Online Studios.
In a further shakeup, Microsoft sold off four studios — Compulsion Games, Double Fine, Ninja Theory, and Undead Labs — and is reportedly considering shutting down Arkane entirely. An additional 3,200 employees outside the Xbox division were also laid off on the same day.
Unions Fight Back
The CWA, which represents hundreds of employees across Microsoft’s Xbox studios in the United States and Canada and covers roughly 3,500 video game workers industry-wide, is pushing back hard. The union argues that Microsoft had the financial resources to avoid layoffs and chose instead to cut workers while bleeding institutional knowledge and creative talent.
CWA Canada specifically represents Bethesda workers at the studio’s Montreal location. Following the July 6 layoff announcement, the union demanded fair treatment for affected employees, noting that workers had no advance notice and no understanding of why they were targeted.
“Those workers will not be treated as disposable,” CWA District 9 Vice President Frank Arace said in a statement, arguing that Microsoft chose to spend its money elsewhere rather than support its Xbox teams.
Workers Rally Nationwide
Prior to the layoff announcement, Xbox union members had publicly called on Microsoft to engage in transparent, good faith negotiations, accusing the company of routinely ignoring union proposals and dragging its feet on worker protections.
On Wednesday, Xbox employees at six studio locations across the US and Canada held a Save Our Devs protest rally to demonstrate against the cuts.
“Our lawyers in the USA and Canada find these layoffs to be illegal and are therefore filing unfair labor practice actions against Microsoft on both sides of the border,” union organizer and former Bethesda employee Simon Prefontaine told Game Developer. “We’re ready to do everything we can to get our members back to work on the games we love.”
The NLRB case (16-CA-390759) is now pending as the video game industry watches closely. The outcome could set significant precedents for labor rights in gaming, an industry where unionization efforts have gained momentum since late 2021, with Microsoft’s studios at the forefront of organized labor in the AAA gaming space.