Microsoft has revealed new details about the voluntary retirement package it plans to offer long-serving employees in the US, including healthcare coverage, cash severance payments, and accelerated stock vesting.
According to a report from The Verge, eligible employees who choose to retire voluntarily will receive up to five years of medical benefits alongside lump-sum cash payments and additional stock vesting incentives. The package expands on Microsoft’s earlier April announcement that it would launch the first voluntary retirement program in the company’s more than 50-year history.
The Verge reported that employees whose age and years of service add up to 70 or more will qualify for the program. Around 7% of Microsoft’s US workforce, roughly 8,750 employees, are expected to be eligible for the offer.
Under the plan, employees who accept the retirement package will receive access to Microsoft’s medical, dental, vision, and well-being coverage for up to five years. The company will fully subsidize the first year, while employees will pay monthly premiums for the remaining four years.
The severance payout will vary depending on employee level. According to The Verge, mid-senior employees at Microsoft, classified internally as level 64, will receive one week of base pay for every six months of service, capped at 39 weeks. More senior employees at levels 65 to 67 will receive two weeks of base pay for every six months of service, also capped at 39 weeks.
Microsoft is also offering accelerated vesting for unvested stock awards. Employees who choose voluntary retirement will receive six months of additional vesting, which increases to 12 months for workers with at least 24 years of continuous service.
The company first announced the retirement program in April as part of broader changes to its employee rewards and performance systems. In an internal memo obtained by The Verge at the time, Microsoft Chief People Officer Amy Coleman said the company wanted to support employees who may be “considering their next chapter.”
While Microsoft has not described the move as a workforce reduction effort, the timing comes as major tech companies continue reshaping spending priorities around AI infrastructure, talent, and operational efficiency. The Verge also reported that Microsoft expects to take a $900 million charge tied to the one-time retirement program.
David Adubiina
