Bethesda’s post-layoff drama is not cooling down anytime soon.
OneBGS, the union representing workers at Bethesda Game Studios, has filed a legal complaint in Canada over how layoffs were handled at the studio’s Montreal office. The union claims Bethesda broke Canadian labour rules after employees were allegedly given one expectation, then hit with termination letters shortly after.
According to OneBGS, affected Montreal staff were first told they would stay employed until September while the company negotiated severance terms with the union. But by the end of that same week, the union says workers received termination letters offering only the minimum severance required by law.
That is the key issue here: OneBGS argues the company should have continued bargaining instead of moving straight to individual termination terms. The union has publicly called out both Bethesda and Xbox, saying Montreal staff are being treated especially badly under Microsoft’s gaming division.
The layoffs are part of the wider Xbox cuts that began this summer, with Microsoft planning to eliminate more than 3,000 jobs across its gaming business. Bethesda, one of Xbox’s biggest first-party studios, was among the teams affected.
For Malaysian and SEA players, this may sound like overseas corporate news at first — but it matters because Bethesda is not some small side studio. This is the house behind Fallout and The Elder Scrolls, two franchises with huge global fanbases, including plenty of PC and Game Pass players in Malaysia. When major studios lose staff, the impact can show up later in slower development, cancelled internal plans, weaker post-launch support, or more cautious creative decisions.
Bethesda has already talked about what fans can expect from future Fallout and Elder Scrolls projects after the cuts, but labour disputes like this add another layer of uncertainty. Games take years to build, and the people making them are the engine behind everything players eventually see — quests, systems, bug fixes, expansions, localisation, performance tuning, all of it.
This complaint also fits into a bigger pattern around Microsoft’s recent downsizing. The Communications Workers of America has already accused Microsoft of bargaining in bad faith on behalf of workers in the US and Canada. So this is not just one isolated office being unhappy; it is part of a wider fight over how gaming giants handle layoffs when unionised workers are involved.
The industry has been brutal over the past few years, with thousands of developers losing jobs even while major franchises continue to print money. For players, it is a reminder that the games we love do not just appear because a publisher logo says so. Real teams build them, and when those teams get cut or pushed around, the effects can eventually reach everyone holding a controller or mouse.
For now, Bethesda and Microsoft are facing another public labour headache. Whether the Canadian complaint leads to penalties, negotiations, or a quiet settlement, the message from the union is clear: the Montreal layoffs are not going unchallenged.
Reporting source: Engadget