Written by Howard Levitt and Kathleen Burkimsher From Levitt LLP on July 4, 2025
In the ever-evolving landscape of politics and technology, the recent breakdown in the once-cozy relationship between President Trump and Elon Musk offers more than tabloid intrigue.
Beneath the scintillating, even titillating, drama lies a narrative which mirrors the principles — and pitfalls — of employment law, particularly around mutual expectations, loyalty and power dynamics in high-stakes relationships. It is a case study for employers and employees alike in what not do both when entering and when exiting an employment relationship.
President Trump appointed Musk in November 2024 as a special government employee (SGE), a position reserved for experts or consultants who are limited to working for the government for a maximum of 130 days. Ironically, one of the supposed benefits of an SGE is that the term contract is designed to be less burdensome than hiring a regular employee.
The end of Musk’s tenure came on May 30, and while it initially appeared that he would leave the White House gracefully and on good terms, his departure quickly devolved. The pair were soon trading public insults on their respective social media platforms, X and Truth Social, with Musk criticizing the now enacted One Big Beautiful Bill Act as a “disgusting abomination” and Trump threatening to remove billions in federal subsidies and tax cuts for Musk’s companies. The hostilities cooled temporarily, but were recently reignited by the Tesla CEO when he announced the launch of a new political party, the America Party.
The unravelling of the Trump-Musk tandem was not unlike what we often see transpire in the breakdown of an employer-employee relationship, with unmet expectations, misaligned values and accusations of disloyalty.
President Trump’s relationship with Musk was initially effusive. Musk claimed that he would cut US$2 trillion from the deficit, but, like many job applicants, he overpromised and underdelivered. Setting the parties’ expectations clearly in employment agreements is an obvious first step and one likely missed in this case.
Employers can set themselves up for success by having properly drafted employment agreements. While Musk’s endeavour as SGE had a pre-determined end date, fixed-term contracts for employees are virtually always a mistake for several reasons, the most applicable one being that, if an employer determines that the fixed-term employee does not meet the expectations of the business, terminating early presumptively requires the employer to pay the balance of the contract. Conversely, with an indefinite-term employee and a clearly worded and enforceable termination provision, an employer faced with a similar problem as President Trump’s situation with Musk can terminate an employee without cause by providing only minimum statutory notice entitlements.
While Trump and Musk were not in a traditional employment relationship, or one at all, their high-profile alliance and spectacular fallout underscore the utility of the inclusion of restrictive covenants in employment agreements, such as confidentiality provisions with an appropriately crafted definition of confidential information. Although all employees have a legal duty of confidentiality, the articulation of such in an employment agreement ensures that both parties are on the same page and will prevent departing employees from leveraging protected information in their future endeavours. Combining strong confidentiality provisions with enforceable non-solicitation clauses will limit an employee’s ability to meddle in the business affairs of an organization.
Anticipating the breakdown of an employment relationship and invoking mitigating steps could have prevented most of the blowback on Trump. Having enforceable termination provisions limiting an employee’s entitlements upon termination allows a company the opportunity to provide a gratuitous offer upon termination in exchange for the employee’s execution of a full and final release, which will undoubtedly include a non-disparagement clause. This prevents the employee from making negative or critical statements about their employer, even if those statements are true. If an employee breaches this clause, the employer can enforce the terms of settlement and demand repayment of the gratuitous payment. Posting negative statements about an employer to one’s social media account following a settlement amounts to such a breach.
