The Bethesda Game Studios Union has announced it is filing a legal complaint against Bethesda, asserting that the company has violated labor laws in Canada by prematurely terminating Canadian employees on July 17. This action follows a series of announcements from Xbox regarding the future of the Fallout franchise, which the union suggests served as a deliberate distraction.
According to the OneBGS union, Bethesda Game Studios blindsided employees at its Montreal office with termination letters delivered via email on the evening of July 17. This contradicted earlier assurances given on July 6, when dozens of employees across the US and Canada were informed during a video call that their employment would continue until September while severance packages were negotiated with the union. These negotiations were intended to provide some measure of stability for affected workers.
Instead, the Canadian employees, who are part of the Fallout and Elder Scrolls teams, received termination notices stating they would receive the statutory minimum severance: eight weeks' pay in lieu of notice, plus any outstanding vacation pay. Crucially, these employees also immediately lost their group health benefits.
This situation is exacerbated by the fact that the Communications Workers of America and CWA Canada, unions of which the Bethesda union is a part, had already filed a joint complaint against Microsoft before July 17. CWA Canada president Carmel Smyth stated at the time that Microsoft had unlawfully terminated employees without prior consultation or discussion with the union, despite ongoing collective agreement negotiations. The union has indicated it will continue to pursue legal challenges against Microsoft as necessary.
The OneBGS union views these dismissals as a direct consequence of management decisions, stating, "Bethesda and Xbox leadership depend on our labor to make them millions, and yet when we do, we are disposed of. The cycle of workers paying for the mistakes of management ends here."
The timing of the layoffs, occurring on the same day Xbox revealed multiple Fallout projects—including remasters of Fallout 3 and New Vegas, a new Fallout game from Obsidian, and confirmation of Fallout 5 in early development—has drawn particular criticism. The union implies these announcements were strategically deployed to mitigate negative public reaction to the layoffs and studio closures, rather than to genuinely reassure the gaming community.
