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Originally published February 24, 2009 at 12:00 AM | Page modified February 24, 2009 at 10:52 AM


Laid-off Microsoft workers get to keep extra severance money

Microsoft reversed course Monday and agreed to let 25 laid-off workers who were paid too much severance keep the extra money.

Seattle Times technology reporter

Being laid off is bad. Worse is receiving a letter from your former employer saying you owe $4,000 because you accidentally were given too much severance.

After doing just that to 25 former employees, Microsoft reversed course Monday.

Human-resources chief Lisa Brummel called each of the 25 -- part of the 1,400 people notified Jan. 22 in the company's first widespread job cuts -- to personally explain the "clerical error" that caused the overpayment, and inform them they could keep the extra dough, ranging from a couple hundred dollars to more than $5,000.

"I can tell you universally they were quite happy," Brummel said Monday, two days after learning the company was asking the unemployed to pull out their checkbooks. "I just felt like ... this is a unique circumstance where the normal course of business doesn't really apply."

She said the move was not in response to negative publicity that erupted over the weekend when a letter surfaced on TechCrunch, a technology news site.

But at an average of $4,000 to $5,000 for each of the 25 overpaid workers -- roughly $100,000 to $125,000 total -- this was a public-relations blunder that Microsoft cleaned up on the cheap, at least relative to its $20.7 billion bank balance.

Payroll errors happen from time to time at any company, Microsoft not excepted. Brummel herself noticed a bigger-than-expected bonus about five years ago, she said. She wrote a check for the difference.

In this case, the clerical error also left 20 laid-off employees short on severance.

"All of those 20 employees immediately got a letter and a check making up the difference, and it caused us to overpay 25 employees," Brummel explained.

Most U.S. employees laid off by Microsoft were eligible for at least 60 days of pay and additional severance based on tenure and level.

Benjamin J. Romano: 206-464-2149 or

Copyright © 2009 The Seattle Times Company

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