Microsoft has recently announced plans to lay off approximately 1% of its 228,000 employees, primarily focused on those who received lower performance reviews across various departments. This move aligns with the company's emphasis on maintaining a high-performance workforce.

In addition, Microsoft also announced an unrelated layoff impacting employees across its gaming, security, and sales divisions.

If you received a worse than expected performance review this review season, it's essential to understand the severance packages Microsoft offers. We will give an overview based on past layoff trends at Microsoft as well as how Microsoft's severance package in 2025 stacks up compared to competitors. To assist affected employees, we've prepared guides with resources to help you plan for the future.Additionally, by sharing your severance offer on fired.fyi, you can see how your package compares to others to help you negotiate the severance you deserve.

Microsoft Layoffs 2025: What We Know So Far

Microsoft has provided limited public information about these layoffs, which will reportedly impact between 2,000 and 3,000 employees. The company announced an unrelated layoff affecting employees across gaming, security, and sales divisions as well. A Microsoft spokesperson shared the following statement with CNBC:

At Microsoft we focus on high-performance talent. We are always working on helping people learn and grow. When people are not performing, we take the appropriate action.

Microsoft's Previous Severance Packages

Microsoft has consistently offered competitive severance packages to employees affected by layoffs, though not quite as generous as some of their tech peers. Here's a detailed breakdown of Microsoft's severance history:

Layoffs in 2023

During the significant reduction that affected 10,000 employees (approximately 5% of staff), Microsoft provided U.S.-based employees with a comprehensive package. This included severance pay of 2 months base salary, plus 1 week for every six months of service. Employees also received six months of healthcare coverage, continued vesting of stock awards for six months, and career transition services. Microsoft also provided a 60-day notice period prior to termination, regardless of legal requirements, as outlined in their official announcement by CEO Satya Nadella..

Layoffs in 2024

Microsoft continued their workforce reductions in 2024, including approximately 1,900 positions in their gaming division. While specific details weren't publicly disclosed, the company maintained their commitment to providing competitive packages aligned with their previous offerings, demonstrating consistency in their approach to supporting departing employees.

Given this history, it's reasonable to anticipate that Microsoft's 2025 severance packages will be consistent with prior offerings, providing substantial support to departing employees.

How Microsoft's Severance Compares to Industry Standards

In the big tech world, Microsoft strikes a middle balance and has historically been reasonably generous in terms of severance benefits, though certainly not the most generous:

Google

Google has shown particular generosity in their severance approach, offering 16 weeks of base pay plus an additional two weeks per year of service. Their package notably includes a 16-week stock vesting acceleration period, which provides substantial value particularly for senior employees. They match Microsoft's six months of healthcare coverage and career transition services, but their overall financial package tends to be more robust.

Amazon

Amazon's approach to severance reflects their general compensation philosophy, offering less generous terms than their tech peers. Their standard package includes 2 or 3 months of base pay and benefits, with an additional week of pay for every 6 months of service. This is capped at a maximum of 20 weeks and includes a minimum guarantee of 4 weeks. Healthcare coverage through COBRA matches the calculated severance period. Microsoft's package demonstrates more generosity in both duration and structure.

Meta

Meta sets a high bar for severance packages with their 16 weeks of base pay plus 2 weeks for each year of service, notably without any cap. They also provide full PTO payout and continued stock vesting through the current period. Their six-month health insurance coverage matches Microsoft's, and they offer comprehensive career support including resume reviews and job placement assistance. Meta's package also includes immigration support for visa holders, making it one of the most competitive in the industry.

What to Expect from Microsoft's Severance Packages in 2025

Based on Microsoft's consistent approach to severance and the competitive pressures of the tech industry, departing employees can likely expect similar terms to previous packages:

Financial Compensation

The standard package will likely maintain the formula of 2 months base pay, plus 1 week for every six months of service, along with continued vesting of stock awards for six months.

Healthcare Benefits

Employees can expect the continuation of healthcare coverage for six months, maintaining Microsoft's commitment to supporting transitioning employees.

Additional Support

The package should include career transition services to help employees navigate their next steps professionally.

Conclusion

While we await Microsoft's formal announcement regarding the specific terms of their 2025 layoffs, affected employees can take some comfort in the company's history of providing consistent and competitive severance packages. To better understand how your package compares to others and maximize your negotiating position, consider submitting your offer to our severance comparison database. Microsoft has maintained a reliable approach to supporting departing employees, though their packages tend to be less generous than some peers like Meta and Google. If you have more complex questions about the layoff process or your severance package, you should consult with an employment attorney for personalized guidance.

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We wish you the best as you navigate this challenging transition.