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- XAI told workers in an all-hands Monday that layoffs were over, then terminated more people.The company said it's giving data annotators a 10% raise and increasing hiring for specialty tutors.XAI laid off more than 500 workers on the team that trains Grok on Friday night.
Amid mass layoffs, leadership changes, and little company-wide communication, the new leader of the xAI team training Grok told workers this week they could "breathe a sigh of relief."
During a team-wide all-hands on September 15, the head of the data annotation team, Diego Pasini, told workers they would receive 10% raises, and that the company planned to expand the number of workers on the data annotation team to 10 times its current size. Data annotators train chatbots like Grok by rating responses and labeling content so the system learns to be more accurate and consistent.
He also said that Elon Musk's AI company did not plan to make further cuts, multiple workers told Business Insider.
A few hours later, more than a hundred workers were let go, the workers said.
One worker said the meeting felt "chaotic," and several others told Business Insider some workers couldn't attend because attendance was capped at 500 — about half the remaining data annotation team.
The meeting was part of a tumultuous start to the month for Musk's AI venture. Beginning on September 5, the data annotation team saw a leadership exodus; layoffs affecting at least 500 staffers; one-on-one meetings where employees were asked to explain what they did at the company; and an announcement from Pasini asking workers to take tests that would determine their future roles at the company.
A representative from xAI did not respond to a request for comment.
Layoffs come amid a hiring push for 'specialty' annotators
Pasini's Monday comments about radically increasing the size of the data annotation team echoed social media posts by xAI's head of legal affairs, Lily Lim, and job posts from xAI.
On Friday evening, as the first round of layoffs hit, Lim wrote on X that the company was "hiring like crazy," while quoting a post from the official xAI account saying it planned to surge its specialist team by "10x."
Join xAI! We are hiring like crazy!!! https://t.co/gcbETtbYPv
— Lily Lim (@LiLiDuc22) September 13, 2025
Until recently, xAI had hired both specialists and general data annotators to train its chatbot. Specialists focused on dedicated topics, while generalists pivoted between any number of projects, including reviewing video, audio, and longform writing, as well as initiatives focused on honing Grok's personality.
During the first wave of layoffs, the company said it would cut most of its general tutors and move the remaining tutors into specialties — from STEM and finance to roles focused on memes and safety. Pasini said at the all-hands that the company also plans to have a small group of specialists focused on politics, multiple people said.
XAI has 16 roles for the team listed online, including for "Memes and Headline Commentary" and people to work on Grok's "Personality and Behavior." The new roles have much higher pay ranges than previous data annotator roles, jumping from between $35 to $65 per hour to $45 to $100 per hour.
Pasini said during the meeting that workers would be organized into the new teams and specialties on Tuesday, September 16, multiple people said.
A current worker said morale has been on a downward spiral over the past week and that it's difficult to trust "job security" when xAI laid off workers just hours after saying the layoffs were over.
'We were all kind of sitting there watching the numbers go down'
Many of the staffers impacted by the second wave of layoffs appeared to be working on international contracts through outside agencies, multiple workers told Business Insider.
Laid-off US workers were previously told they would receive pay through the end of their contract or November 30, whichever came first. It's unclear whether international workers will receive the same amount of pay; they were told that their agency "would be in touch with you to discuss next steps in relation to your employment."
The earlier batch of cuts affected at least 500 workers, Business Insider previously reported. Those workers lost access to their Slack accounts within 20 to 30 minutes of receiving notice, insiders said. Several workers told Business Insider they learned they'd been laid off when they were locked out of Slack.
"We were all kind of sitting there watching the numbers go down," one worker said. The company's internal Slack dropped from more than 1,500 members to around 1,000 on September 12, according to a tally seen by Business Insider — only to further drop to around 900 by September 16.
XAI's workforce is divided between workers on its engineering team in Palo Alto, data center staff in Tennessee, and the Human Data team, which is largely remote. Data annotators account for the majority of the company's employees.
Shortly after the layoffs commenced on September 12, xAI shut down access to many of its public Slack channels, multiple workers said.
The layoff notices were sent out a few days after several senior-level employees, including the team's manager, had their Slack accounts deactivated, Business Insider previously reported.
In the days that followed the leadership shakeup, some workers were pulled into one-on-one meetings to review their work. They were also asked to take subject-matter tests that would determine what their roles at the company would look like going forward. Workers had less than 24 hours to complete the tests, which focused on safety, STEM, and coding, as well as topics including "Shitposters and Doomscrollers" and Grok's "Personality and Model Behavior."
The "Shitposters and Doomscroller" test asked workers to rank X posts on a scale of "Weak" to "Banger," identify spam posts, share their favorite X memes and posts, and provide a screenshot of their activity on the social media site, former workers said. It asked them to rate memes with multiple images that were not safe for work, including an image of a woman being sexually assaulted, they said. Some other tests were simpler, including an audio test that asked workers to distinguish the AI-generated voice from a human voice within two clips, ex-workers said.
Two said they stayed up through the night to take the tests, another said they ran out of time before the deadline.
The first wave of layoffs began the same day the tests were due.
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