Microsoft has finally put numbers on its voluntary retirement program, and the package combines healthcare coverage, cash severance, and a partial stock vesting bump for long-serving US employees who decide to walk away. The terms were meant to go live for staff on Wednesday, but according to The Verge, the company posted them on its internal HR website a day earlier than planned.This is the first voluntary retirement program in Microsoft’s 51-year history. The company said last month it will take a $900 million charge in the current quarter to fund the buyouts. About 7 percent of Microsoft’s US workforce, or roughly 8,750 people, are eligible. The formula is simple: add your age to your years of service, and if the total is 70 or more, the offer is on the table. Employees get 30 days to decide.
Healthcare coverage runs five years, but only the first is fully paid by Microsoft
The medical side of the package is the headline benefit for anyone retiring before they hit Medicare age. Microsoft is offering five years of medical, dental, vision, and well-being coverage. The first year is fully subsidised by the company. For the remaining four, employees will pay a monthly premium themselves. That distinction matters. A 55-year-old walking out today still has a decade before Medicare kicks in at 65, and the cost of bridging that gap will land squarely on whatever Microsoft decides to charge for those four out-years.
Microsoft’s cash severance scales with seniority and tops out at 39 weeks of base pay
The lump sum payout depends on what level you sit at. Mid-senior employees at level 64 get one week of base pay for every six months of regular service, capped at 39 weeks total. Anyone in the senior bands—levels 65 through 67—gets double that, with two weeks of base pay for every six months of service and the same 39-week ceiling. So a level 65 employee with about 10 years at the company would max out the cash payment, while a level 64 with the same tenure would land at around 20 weeks. Per The Verge, these details were drawn from Microsoft’s internal HR posting, which went live ahead of schedule.
Stock vesting gets six extra months, and a full year for the longest-tenured staff
Microsoft is also accelerating six months of unvested stock for anyone who takes the offer. Employees with 24 or more years of continuous service get double—a full year of additional vesting. That tier is small but meaningful. It’s the kind of carve-out designed for people who joined Microsoft in the early 2000s and stayed through the Ballmer years, the cloud pivot, and now the AI buildout.The offer arrives after more than 15,000 layoffs last year and a wave of executive departures in 2026, which suggests Microsoft is trying to thin its ranks ahead of the new fiscal year in July without another bruising round of cuts. Anyone at senior director level or above is excluded from the buyout, as are employees on sales incentive plans.
