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February 23, 2009 3:12 PM

Microsoft lets 25 laid-off employees keep severance overpayment

Posted by Benjamin J. Romano


After asking 25 laid-off Microsoft employees to return an overpayment of severance benefits, Microsoft's top human resources executive decided to let them keep the money. Calling it a "unique circumstance," Lisa Brummel, senior vice president of human resources, said the employees will not have to repay the overpayment, which ranged from a couple hundred dollars to over $5,000, but averaged about $4,000 to $5,000 across the 25 employees. [Parker Brothers Monopoly card via]

An additional 20 laid-off employees were underpaid severance. They will receive received checks making up the correct amount.

All 45 individuals are part of the group of 1,400 people notified of layoffs on Jan. 22.

Updated, 3:55 p.m.: Brummel did a round of interviews this afternoon in a bid to quickly put to rest an issue that has drawn negative attention to the company's handling of the layoffs. TechCrunch broke the story on Saturday, posting a letter from Microsoft to a laid-off employee seeking repayment of the extra severance. Other media picked it up over the weekend and today.

She said the issue came to her attention through "internal channels."

"This was brought to my attention just recently in the past two days that we had done this and I said, 'You know, this is a unique population. This is a unique circumstance. I think our normal course of business action is the wrong one to take in this case. We should in fact not pursue repayment from those employees and I am going to call each of them personally and let them know that, which I have done,'" she said.

"I can tell you universally they were quite happy," Brummel said. "I just felt like it was--- this is a unique circumstance where normal course of business doesn't really apply."

Asked if the attention the story was getting played into her decision to let the laid-off employees keep the extra severance, Brummel said, "Honestly, I didn't see any of the media coverage." She said she reads the papers but was "more interested in the Seattle Opera review today than anything else."

The severance payment errors were due to a "clerical mistake on our end," she said.

Severance benefits varied by country. Most U.S. employees were eligible for at least 60 days of pay, and additional severance based on tenure and level.

What do you think of Microsoft's decision?

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