Xbox’s ZeniMax Leadership Purge Repeats Itself as Unions Sue Microsoft

Joe Burba ran ZeniMax Online Studios for exactly one year. On July 15, the studio’s staff learned he was out, along with the three executives who ran The Elder Scrolls Online day to day, as Microsoft’s latest round of Xbox layoffs finished tearing through the leadership it had installed after the last one.

The timing is the story. Burba took the studio’s top job last July after Microsoft’s previous cuts pushed out his predecessor. A year later, almost to the week, he became one of 379 ZeniMax workers caught in a new purge, this one tied to 3,200 job cuts across Xbox and a federal labor complaint that landed on Microsoft’s desk nine days after the layoffs began.

A Studio Head Who Lasted Exactly One Year

Microsoft’s cuts hit ZeniMax Online Studios and its parent company hard. A Maryland WARN filing obtained by Game File showed almost all 379 layoffs were issued on July 6, with a handful notified earlier. Of those, 213 came from ZeniMax Online Studios and 166 from ZeniMax Media, the Rockville-based parent that also houses Bethesda Game Studios.

What the filing didn’t show up front was who else was leaving. On the evening of July 15, ZeniMax Online staff learned that studio head Joe Burba, a 14-year company veteran promoted into the role last July, was departing alongside Elder Scrolls Online executive producer Susan Kath, studio game director Rich Lambert and production director Ala Diaz.

All four are staying on for a few months to hand the studio to a new leadership pair: business operations lead Josh Henderson and game director Nick Giacomini, who took that role himself last August. Burba told staff he had “tremendous confidence in Josh and Nick, the future of this studio, and the continued growth of ESO.”

ZeniMax’s Two Rounds of Cuts, One Repeating Cast

Burba’s exit is not a new story for this studio. It is the same story a year later, with new names attached to the same outcome.

Microsoft’s original bet on this roster of studios was itself a large one. It announced the $7.5 billion purchase of ZeniMax Media in 2020, a deal that closed the following year and brought Bethesda, Arkane, id Software and ZeniMax Online under one roof. Six years on, that roof has a leadership team that keeps getting replaced faster than it can settle in.

Firor, who left the studio last year, described the feeling of being cut loose in blunt terms when he spoke with MinnMax earlier this year. “We’re a number on a ledger, and if that number is large, it is ripe for analysis, shall we say, and that number was always large,” he said. PC Gamer reports the studio has lost at least 40% of its workforce since that 2024 headcount estimate.

Unions File Federal Charges Over the Layoffs

Nine days after the layoffs began, the Communications Workers of America (CWA, a labor union representing more than 3,500 video game workers across the industry) and CWA Canada filed joint unfair labor practice charges against Microsoft with the National Labor Relations Board.

The charges name Microsoft and subsidiaries including Xbox, ZeniMax Media, id Software and Bethesda Game Studios. According to the filing, the unions allege four categories of violation:

• Repudiation or modification of contract, tied to changes made to union members’ working conditions.
• Refusal to furnish information that unions say they were entitled to during bargaining.
• Refusal to bargain or bad faith bargaining, including alleged surface bargaining and direct dealing with employees.
• Coercive actions, including alleged surveillance of union activity.

CWA Canada president Carmel Smyth, whose union represents Bethesda’s Montreal studio, told Game Developer the company had gone around its legal obligations. “The unions CWA and CWA Canada have jointly filed unfair labor practice complaints against Microsoft alleging the company has 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,” Smyth said. She added the company “can not arbitrarily change working conditions while it is engaged in negotiating with the union.”

Microsoft’s response, sent to Game Developer, struck a softer tone without addressing the specific allegations: the company said it “reached out to the union to begin effects bargaining” and remains “committed to that process.” CWA’s own statement on the layoffs framed the fight in broader terms, with national president Claude Cummings Jr. saying Microsoft had made “an agreement with video game workers and their union” to respect organizing rights when it first grew its gaming division.

Why This Legal Fight Faces Long Odds

The charges are real. Whether they go anywhere is a separate question, and the numbers on that are not encouraging for the unions.

A Center for American Progress analysis of more than 40,000 NLRB cases found that between January 2025 and April 2026, the board dismissed 34.7% of unfair labor practice charges filed by unions, a jump of 14.2 percentage points from 2024. The same report found the board dismissed 67.4% of charges filed by workers against employers, up 10.7 points. The board also went without a quorum for 345 days in 2025 after a board member was removed, leaving fewer decision-makers to clear a growing backlog.

Union members pushing the case know the math. A current id Software employee and union member told gaming outlet Aftermath why they still think it matters.

It’s important, even for the world’s largest and most profitable companies, that there are consequences for violating federal labor law. If we hadn’t explored this avenue to hold Microsoft accountable, it would be a sign to all other game executives that they can break the law and get away with it.

The NLRB’s own case data shows more than half of all charges filed end in withdrawal or dismissal, a baseline that predates the current administration and makes this fight an uphill one even in ordinary years.

What’s Left of Elder Scrolls Online’s Team

Whatever happens with the charges, the studio making The Elder Scrolls Online has to keep shipping games with a much smaller staff than it had two years ago.

ZeniMax Online representatives say the team is now roughly the size it was during development of the Wrothgar and Summerset expansions, years before this round of cuts. New leaders Henderson and Giacomini inherit a studio that pushed live its Thieves Guild season content just days after the layoffs were announced, proof the pipeline is still running even as the people managing it change again.

Whether that pipeline holds up under a fourth or fifth leadership reset is the open question nobody at Microsoft or ZeniMax has answered publicly.

The Reset Reaches Far Beyond One Studio

ZeniMax is one piece of a much larger reduction. Microsoft’s 3,200 planned Xbox cuts, sanctioned by Xbox division leader Asha Sharma, who joined the unit earlier this year, also hit Activision, Blizzard, King, Mojang and Xbox Game Studios directly, while the company sold off Compulsion Games, Double Fine, Ninja Theory and Undead Labs outright.

Arkane Austin’s parent studio group has already absorbed one closure in this cycle, and the fate of its vampire-hunter project remains unresolved even after surviving the initial round of Xbox studio cuts. Montreal’s Bethesda support office lost 12 employees in the same wave that triggered CWA Canada’s legal filing.

Microsoft says 1,600 of the 3,200 planned cuts have already landed, with the rest scheduled before its fiscal year closes in June 2027. The unfair labor practice charges sit with the NLRB now, unresolved, while ZeniMax Online Studios starts building its third leadership team in as many years.

Frequently Asked Questions

What is effects bargaining, and why does Microsoft keep citing it?

Effects bargaining covers negotiations over how layoffs are carried out, like severance and timing, rather than whether the layoffs happen at all. Unions argue Microsoft owed them decisional bargaining, a separate and earlier stage covering the decision itself, before any notices went out.

How many total jobs has Microsoft cut across Xbox this year?

Microsoft has cut 1,600 jobs immediately as of July 6, with another 1,600 planned before its fiscal year ends in June 2027, for a total of 3,200 across the Xbox division.

Is The Elder Scrolls Online being shut down?

No. ZeniMax Online Studios representatives say the game remains in active development under new leadership, and new seasonal content shipped in the days following the layoffs.

What happens if the NLRB dismisses the union charges?

A dismissal can be appealed to the NLRB’s Office of Appeals in Washington within two weeks of the ruling, though Center for American Progress data shows dismissal rates for union-filed charges have risen sharply since 2025.