Charges filed with the NLRB accuse Xbox of bad faith bargaining.

Following another round of mass layoffs and studio upheavals at Xbox, Communications Workers of America has filed unfair labor practice charges against Microsoft with the National Labor Relations Board. The CWA accuses Microsoft of bad faith bargaining, coercive actions, contract repudiation and failing to provide notice to employees, according to the charge on the NLRB site. The case was filed on July 15 in the United States, and CWA Canada is taking legal action against Microsoft as well, as reported by Game Developer.

On July 6, Microsoft announced it would immediately cut 1,600 jobs across its Xbox division, with plans to lose another 1,600 employees over the coming fiscal year. The layoffs hit Activision, Blizzard, King, Mojang, Xbox Game Studios and ZeniMax, which covers Arkane, Bethesda, id Software, MachineGames and ZeniMax Online. Microsoft also sold off four Xbox studios — Compulsion Games, Double Fine, Ninja Theory and Undead Labs — and it's reportedly considering shutting down Arkane. Microsoft laid off an additional 3,200 people beyond the Xbox division that same day.

CWA represents hundreds of employees at Xbox studios in the United States and Canada, and the labor union covers 3,500 people across the video game industry. Video game employees started unionization efforts in earnest in late 2021, and Microsoft studios have led the charge in the AAA sphere.

CWA Canada specifically represents Bethesda workers in Montreal. On July 6, the union demanded fair treatment for laid off employees, writing in a news release, "The Montreal workers, who work on highly successful game franchises like Fallout and The Elder Scrolls, among others, were shocked. They had no advance notice, no idea why or how they were targeted, and they worry about the negative impact on the games they work on."

Ahead of the layoffs announcement, Xbox union members publicly called for Microsoft to engage in transparent, good faith negotiations. They accused the company of regularly neglecting union proposals, mismanaging resources and dragging its feet on worker protections.

"We're here to say this plainly: Those workers will not be treated as disposable," CWA District 9 Vice President Frank Arace said. He argued that Microsoft had the money to support its Xbox teams and prevent layoffs, but chose to spend it elsewhere while bleeding creative talent and institutional knowledge.

Xbox employees at six studio locations in the US and Canada protested the layoffs on Wednesday with a Save Our Devs rally.

"Our lawyers in the USA and Canada find these layoffs to be illegal and are therefore filling unfair labor practice actions against Microsoft on both sides of the border," union organizer and ex-Bethesda employee Simon Prefontaine reportedly told Game Developer. "We're ready to do everything we can to get our members back to work on the games we love."