Microsoft Offers 60,000 Buyouts. Your Paperwork Needs a 21 or 45-Day Clock.

This week Microsoft offered voluntary exit packages to about 60,000 employees, roughly a quarter of its staff. ^[1] Most owners will never write a check that size. But the same idea reaches a small shop in a smaller form: a long-time bookkeeper who wants out, a supervisor you need to reduce, a crew you cannot keep at full pay. Whatever you offer will be read closely, and so will the paper it comes with. A rushed offer can be cancelled, challenged or quietly regretted. A clear one is simply a fair deal.

Here is the answer in plain words. A buyout is a payment for leaving. If the offer asks a worker 40 or older to give up age-discrimination claims, federal law sets the minimum time they get to think it over. That is 21 days for one person. For a group, it is 45 days, plus a list of who was chosen and who was not. After signing, the worker has 7 days to cancel. You cannot shorten those clocks by asking, and the payment must be more than what the worker is already owed. ^[3][4]

Why buyouts are showing up now

Big tech is spending at a scale few people predicted. Reporting on the Microsoft offer puts the 2026 spending of Amazon, Microsoft, Alphabet and Meta at roughly $700 billion, mostly on data centers, chips and computing. ^[1] In the same year, several of those companies have also cut jobs. Meta announced about 8,000 cuts in May. Amazon cut 16,000 in January. ^[1]

Microsoft's own explanation is about flexibility. Its chief people officer wrote that the offer creates "greater flexibility and, where possible, more ways for employees to shape their next chapter." A spokesperson said the company is "building more flexible workforce approaches, rather than a one-size-fits-all model." ^[1] Reporters describe the move as cost-cutting during heavy AI investment. That is their framing, not the company's. Read both before you repeat either.

An employment lawyer quoted in Fortune gives a second view, and it is her interpretation, not Microsoft's. A buyout lets an employer reduce headcount without the evaluations, selection decisions and litigation risk that layoffs bring. ^[2] That view is worth knowing because it explains the paperwork. The offer is voluntary, so the rules that protect the worker still apply in full.

So what: Expect more exit offers from more employers, including small ones. Read every one the way a careful lawyer would read it, even when you are the one making the offer.

The Groundwork Clock Check

A three-part test for any exit offer. Run it before the paper leaves your desk.

1. Count the days. One worker gets 21 days to decide. A group gets 45 days, and the group offer must list the job titles and ages of those chosen and those not chosen in the group. Every signed release also gives 7 days to cancel. Write the delivery date, the decision deadline and the last day to cancel on the same page. ^[3]

2. Separate owed from extra. List what the worker is already owed: final pay, earned vacation and any benefit already promised. Only the amount above that list is a true buyout. Put that split in writing so nobody confuses the two later.

3. Read the release. Read what the worker gives up and what they keep. A release should name the claims it covers and leave out anything it does not. If a line is vague, rewrite it before you hand it over. Check the wording against your other agreements; our paper on what a small business contract should say walks through the terms that matter most.

Four examples, all hypothetical

Example 1: The clock. This example is hypothetical. Dana runs a six-person print shop. She offers her 58-year-old bookkeeper an exit package on March 2. The offer is for one person, so the decision window is 21 days, through March 23. The bookkeeper asks questions and signs on March 18. She then has 7 days to cancel, through March 25. Dana kept the full clock, so the signature holds.

So what: count from the day the written offer is delivered, not the day you first mentioned it.

Example 2: The group. This example is hypothetical. Sam has 30 staff. He wants to offer a buyout to six people in one department. Because the offer goes to a group, each person gets 45 days. The offer must also list the job titles and ages of everyone in that department, both those offered and those not. Sam builds the list first, then the disclosure, then starts the clock.

So what: the list is part of the paperwork. Make it before you make the offer.

Example 3: The money. This example is hypothetical. A bookkeeper earns $48,000 a year. Her buyout is $12,000. $48,000 ÷ 12 is $4,000 a month, so the offer equals three months of pay. Her final paycheck and earned vacation are owed anyway, so they do not count toward the $12,000. Before signing, she can see the real value of the offer: three months of pay on top of what she is already due.

So what: price the offer against what is already owed, and say so in writing.

Example 4: The cash. This example is hypothetical. The shop has $30,000 in the bank and spends about $6,000 a month. A $12,000 buyout leaves $18,000, which is about three months of spending. That is before any new sales and before the saved wages. Dana can afford the offer, but she should count the months of cash it leaves and decide with that number in front of her.

So what: pay for a buyout from cash on hand, not from next month's sales.

What to do this week

1. Write down every worker who might be offered an exit in the next 12 months.
2. For each one, count the clock: 21 days alone, 45 days in a group, 7 days to cancel.
3. List what each person is already owed: final pay, earned vacation, promised benefits.
4. Price any extra payment against that list, and put the split in writing.
5. Run the cost through the cash runway calculator on our Free Tools page.

Groundwork's final assessment

A buyout can be fair. It can also be rushed. The difference is the paperwork. Count the days. Separate what is owed from what is extra. Read the release and know exactly what it takes. A large company can pay a team for every step. You can run the same checks yourself, and bring the open questions to your Groundwork adviser before the offer goes out.

Put Groundwork to work for your business

Your Groundwork adviser can walk through an exit offer with you before it goes out: the dates, the owed-versus-extra split and the cash on hand. Second Pair of Eyes is a fixed hourly review, $100 per billable hour with a one-hour minimum for non-alumni, for a decision you want a second set of eyes on before you commit. Second Pair of Eyes covers the details. For the firing side of the same decision, read Fire Well: How to Fire an Employee the Right Way. Every Groundwork project is fixed-price, and Groundwork is not a law firm.

Anticipated Questions

If the worker is happy to sign early, can I accept it?

The worker can choose to sign sooner. You cannot push for it. Keep the full period on the page, and never ask them to shorten it.

Does the age rule apply to a small shop?

The federal age rules apply to employers with 20 or more employees. A smaller shop is not covered by this federal rule, but state law may still apply. Check your state before you write the offer.

Does the 21-day rule cover workers under 40?

The age-waiver rules protect workers 40 and older. A clear release and a fair clock still protect you with any worker.

Can I offer a buyout only to people I want to leave?

Be careful. Choosing people by age, or picking the people you want to push out, creates discrimination risk. Choose by a written business reason, and keep the record.

Is a buyout the same as a layoff?

No. A buyout is the worker's choice. A layoff is your decision. The paperwork and the risk are different, so treat them differently.