Microsoft has detailed its severance package for laid-off US employees after announcing cuts affecting 2.1% of its global workforce. The reductions primarily hit the company's sales and Xbox divisions.
The offer, reviewed by Business Insider, includes a minimum of 60 days of base pay and up to a maximum of 39 weeks, depending on seniority and tenure. Regular stock vesting continues for six to 12 months based on years of service.
Health insurance coverage will be provided for six months, with an additional year of optional COBRA coverage. According to Business Insider, severance formulas vary by level: employees at levels 64 and below receive one week of base pay for every six months of service; those at levels 65 to 67 — principal and director roles — receive two weeks per six months; executives at level 68 and higher have a separate package.
Microsoft declined to confirm details when asked by Fast Company. The scale of the cuts — affecting 2.1% of a workforce that numbered roughly 221,000 as of June 2024 — reflects ongoing cost discipline across the tech sector.
The packages are notably generous compared to industry norms, though the actual number of impacted employees and total cost remain undisclosed. Critics may argue such terms cushion a strategic reallocation of resources toward AI investments rather than genuine hardship.