Microsoft offers up to 39 weeks severance to laid‑off US staff

Microsoft will pay most U.S. employees who are part of the 4,800‑person (2.1% of global) layoff up to 39 weeks of base salary, with a floor of 60 days, and will continue stock vesting and health coverage for several months [1].

At a glance

Severance structure by level

Microsoft’s severance formula varies with internal level and tenure. Employees at levels 64 and below receive one week of base pay for every six months of service; those at levels 65‑67 get two weeks per six months. Executives (level 68+) have a separate arrangement. In addition to cash, the company will keep regular stock vesting active for six to twelve months, depending on years of service, and will provide six months of paid health insurance plus an optional 12‑month COBRA extension [1].

How the package compares

The 39‑week ceiling exceeds the severance offered by several peers. Salesforce caps at 30 weeks, Oracle at 26 weeks, and Meta at 16 weeks of base pay. Microsoft’s minimum of 60 days is also higher than Oracle’s four‑week base guarantee. The extended health coverage (six months paid, plus a year of optional COBRA) is shorter than the company’s earlier voluntary retirement program, which featured longer durations [1].

What to watch

• Future rollout – Whether Microsoft will extend the same severance terms to non‑U.S. staff or adjust the health‑coverage window in subsequent rounds.
• Executive package – Details of the separate severance for level 68+ executives, which could signal how the company values senior leadership amid the cuts.
• AI spending impact – Monitoring how the $190 billion AI‑related capital expenditure plan interacts with cost‑cutting measures and influences future hiring trends.

The generous severance ceiling underscores Microsoft’s effort to cushion the impact of a sizable workforce reduction while still pursuing an aggressive AI infrastructure build‑out. How the company balances these competing priorities will shape its talent strategy and competitive positioning in the tech sector.