While Bethesda announced a host of new Fallout projects being in the works, according to union OneBGS, employees at the company’s Montreal-based studio who were let go as part of Xbox-wide layoffs have been treated quite poorly. Taking to social media, the union has alleged that Microsoft told the now-former employees that they would get the smallest severance package that is possible.
“Last Friday, Xbox flooded news sites announcing every expansion, sequel, and remake they could. That same day, they told their laid-off Bethesda Montreal employees that they would receive the smallest severance legally possible without bargaining with the union.”
Further in its statement, the union also noted that Microsoft had spoken to US and Canada-based employees affected by the layoffs that it would negotiate severance with OneBGS. However, on July 17th, the company has allegedly changed its mind and sent out termination letters to affected employees through email.
“This was contrary to what they had been told in the Monday calls,” explained OneBGS. “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.”
“We’re not going to take this lying down. We’ve filed yet another legal complaint against Bethesda for continuing to violate labor laws in Canada. 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.”
In a now-deleted Bluseky post (via GamesRadar), lead character artist Ben Carnow reiterated the union’s claims that Microsoft had not negotiated with OneBGS despite being legally required to do so. “Folks lost their healthcare with zero notice. Unconscionable.”
Bethesda’s Todd Howard recently acknowledged in an interview that the layoffs were a “really tough” experience for him and his colleagues. However, he also said that the company is going through a change that will allow it to “focus best on the franchises and what we need to do to deliver for everybody.”
The company has confirmed that it will work on Fallout 5 in the future, and in the meantime, will work on remasters of Fallout 3 and Fallout: New Vegas. Along with this, it is also working with Obsidian Entertainment on an entirely new Fallout project. Development on Fallout 76 is also slated to continue as planned, with its team currently working on the Raven Rock expansion.
Aside from this, Bethesda is currently also hard at work on The Elder Scrolls 6. Earlier this month, the company reaffirmed that it remains its “primary development focus today”, and that “the majority of our team” is working on the project.
“With over 65 million copies sold, players are still exploring Skyrim 15 years later, but we know it’s been a very long wait for the sequel.” It then went on to assure that, “We’re where we planned to be, loving how it looks, and playing it every day.”
Bethesda Games Studios’ Montreal workers are being treated especially poorly by XBOX and we won’t stand for it. Here are the details.If this upsets you let Microsoft know: feedbackportal.microsoft.com/feedback/ide…
— OneBGS – Bethesda Game Studios Union (@bethesdaunion.bsky.social) 2026-07-22T14:50:07.511Z
