Microsoft Offers Buyout to 60,000 Employees Amid Rising AI Costs: What Is the Severance Package?

Tech giant Microsoft has announced voluntary buyouts of 60,000 employees, a quarter of its workforce, amidst rising AI infrastructure spending. The offer is eligible for employees in Canada, India, the United Kingdom and the United States at level 70 and below. The voluntary exit offer is a one-time limited programme, and employees who choose the offer will exit by December 2026-end.

Microsoft Voluntary Exit Offer:

"We're introducing a new Voluntary Exit Offer (VEO) to eligible employees within participating organisations. This offer gives eligible employees who may be considering a future outside the company a new choice to make that transition now with support. It also gives participating organisations another way to adapt their workforce to changing needs," said Amy Coleman, Executive Vice President and Chief People Officer to Microsoft employees in a circular.

She added that the Voluntary Exit Offer reflects an important part of how Microsoft is evolving their approach to change: creating greater flexibility and, where possible, more ways for employees to shape their next chapter.

"This builds on what we learned earlier this year through the Voluntary Retirement Program," she said.

Which Employees Are Eligible?

According to Microsoft's circular, this offer will be available to eligible employees in participating teams in Canada, India, the United Kingdom and the United States at level 70 and below.

Amy said, "This is a time-limited, voluntary program that gives those who are eligible the opportunity to leave Microsoft with financial support and career planning resources. Some organizations are providing the Voluntary Exit Offer, and some are not. Participation varies based on each business's priorities, customer commitments and workforce needs."

Eligible employees will receive an email with a link to their Voluntary Exit Offer details within the next few hours.

"The Voluntary Exit Offer is new for us. We'll learn from it. At the same time, we'll keep helping people focus on the work that matters most, build new skills and, where it makes sense, find new opportunities across Microsoft," Amy added.

Further, she said, there is no one-size-fits-all approach for every team or every employee. These are a few of the ways we're trying to meet different business needs while continuing to create opportunities for our own people to grow and contribute.

Microsoft Voluntary Exit Offer: How Much Severance Pay Employees Will Get?

As per reports, employees who have selected voluntary exit will get severance package based on their grade, location and length of service.

Microsoft severance terms in the US, is one week of base pay for every six months of services to employees at Level 64 and below. For employees between levels 65 and 67, severance pay includes two weeks of base pay for every six months of service.

Meanwhile, employees at level 67 and below would get standard severance capped at 39 weeks of base pay. If the employee is at level 68, they could reportedly get 12 months of salary.

In India, as per reports, Microsoft will offer one month of base salary for each completed year of service along with health insurance and career-transition support.

As of June 30, 2026, Microsoft had total 223,000 people on a full-time basis, 121,000 in the U.S. and 102,000 internationally.

Of the total employees, 89,000 were in operations, including product support and consulting services, data centre operations, and manufacturing and distribution; 77,000 were in product research and development; 43,000 were in sales and marketing; and 14,000 were in general and administration. Certain employees are subject to collective bargaining agreements.