Union claims Bethesda developers 'received termination letters' the day Xbox announced new Fallouts—after being told they would still have jobs until September

The Bethesda Game Studios Union says it is filing a legal complaint against Bethesda for "continuing to violate labor laws in Canada" by prematurely terminating Canadian employees on July 17—the same day it dropped a huge announcement about the future of Fallout and other games.

The timing of the Bethesda infodump was suspect, to put it politely. Less than two weeks after Xbox announced that it is laying off 3,200 people and dumping four studios, Microsoft-owned Bethesda suddenly decided that it was time to confirm that Fallout 3 and New Vegas are both being remastered, that Obsidian is working on a Fallout game of its own, and on top of all that, that Fallout 5 is in early development too.

Good news as far as it goes, although as I noted at the time, the obvious intent was to reassure (or convince) followers that the loss of hundreds of employees wasn't all that big a deal, and so maybe just don't think about it so much.

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The OneBGS union implied that the announcement was a more purposeful smokescreen, however, saying that Bethesda "flooded news sites announcing every expansion, remake, and sequel they could" while simultaneously blindsiding employees at its Montreal office by terminating them months ahead of a previously promised date, and with no negotiated severance.

"Previously, on Monday, July 6th, dozens of employees from Bethesda Game Studios across the US and Canada were told via video call that they were being laid off," the union said in a message on Bluesky. "They were told they would remain employed until September while the company negotiated severance with our union; this at least provided some solace and breathing room.

"However, at the end of the day on Friday July 17th the affected Canadian employees (part of the Fallout and Elder Scrolls teams) received termination letters via email. 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."

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...

— @bethesdaunion.bsky.social (@bethesdaunion.bsky.social.bsky.social) 2026-07-22T22:20:58.209Z

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(Image credit: OneBGS (Bluesky))

(Image credit: OneBGS (Bluesky))

(Image credit: OneBGS (Bluesky))

(Image credit: OneBGS (Bluesky))

(Image credit: OneBGS (Bluesky))

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 prior to July 17: CWA Canada president Carmel Smyth told Game Developer at the time that Microsoft had "unlawfully fired people without giving notice to or discussing it with the union as the employer is legally obliged to do when we are in the middle of ongoing bargaining a collective agreement."

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Smyth added that the union would continue to file legal challenges against Microsoft as necessary, and the OneBGS union said in today's message that it has done just that.

"Bethesda and Xbox leadership depend on our labor to make them millions, and yet when we do, we are disposed of," the union said in today's message. "The cycle of workers paying for the mistakes of management ends here."