Microsoft backtracks on severance issue

By Ina Fried, CNET News.com
Tuesday, February 24, 2009 07:18 AM

Amid a wave of criticism, Microsoft is backtracking on a decision to require laid off workers to pay back money that the software maker said was in excess of its planned severance, ZDNet Asia's sister site CNET News has learned.

Over the weekend, Microsoft confirmed it had overpaid severance to some workers and underpaid others. At the time, the company did not say how much money was involved, but sent the workers who were overpaid a letter saying they would be required to pay back the money in excess of the severance they were due.

On Monday, Microsoft human resources chief Lisa Brummel said the company was reversing course.

"I thought it didn't make sense for us to continue on the path we were on," she told ZDNet Asia's sister site CNET News. Twenty-five workers were overpaid and about 20 underpaid, Microsoft said.

Brummel said she has spoken or left messages to most of those affected.

Brummel said those overpaid received, on average, about US$4,000 or US$5,000 in extra pay.

"I have called now 22 out of the 25 impacted employees, only because I haven't had time to get to the three but I will after we hang up," Brummel said.

In general, Brummel said it makes sense for companies to recover money if it makes an accounting error, but she acknowledged the situation was an extraordinary one. Brummel said the company actually overpaid her at one point during her long tenure.

"It actually happened to me and I wrote the company a check," she said. "It may have happened to others."

This article was first published as a blog post on CNET News.


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