Microsoft offering voluntary retirement to thousands of employees

A first for Microsoft – the company is offering a one-time voluntary retirement package.

According to a report from GeekWire, buyouts will be offered to senior directors and below, whose years of service at the company, plus age, add up to 70 or more.

“It’s very interesting because you usually don’t expect technology companies to be using early retirement plans,” said Joe Phillips, an economics professor at Seattle University. “Then the other issue with these early retirement plans is you can’t always control who’s participating.”

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Microsoft declined a request for comment from KIRO 7.

Experts say the buyout could be a way to shed higher salaries as the company continues to invest more in AI.

“The company is spending a lot of money gearing up for AI investing and so forth, and investors in the financial markets are getting a little bit impatient with all that increased expenditure,” said Phillips.

About 7% of Microsoft’s U.S. workforce will be eligible for the early retirement deal – about 8,7500 employees.

This, after Microsoft laid off 15,000 employees last year.

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Mark Harmsworth, with the Washington Policy Center, was a Microsoft employee for 15 years and says the buyout could be quite enticing.

“If they retire some folks now before the income tax deadline in 2029, they would avoid, not on the capital gain side of things, but certainly the income tax side of things, so it would be appealing if you’re thinking of working three or four more years in Washington,” said Harmsworth.

Eligible Microsoft employees are expected to be notified May 7 and given 30 days to decide.