Microsoft and Skydance offer buyouts: What the new exit deals mean for workers

Two of the biggest names in tech and entertainment told employees on Monday, Oct. 26, that some of them can now leave with a package instead of waiting to see what comes next.

Microsoft announced a time-limited Voluntary Exit Offer for eligible employees in participating teams in the United States, Canada, the United Kingdom and India. About 60,000 people are eligible, the company told GeekWire, roughly a quarter of its workforce. On the same day, Skydance, the company formed when Paramount completed its roughly $111 billion takeover of Warner Bros. Discovery on Oct. 6, told staff it is launching a voluntary buyout program and moving everyone to a five-day-a-week office schedule, according to a memo from chairman and CEO David Ellison and co-CEO Ynon Kreiz published by Variety, The Hollywood Reporter and Business Insider.

The two programs differ in size, terms and timing. Both, however, show how large employers are increasingly using voluntary departures as one tool for reshaping their workforces, alongside office mandates and, in some cases, job cuts.

What Microsoft announced

Microsoft's chief people officer, Amy Coleman, announced the program in a message to employees that the company also posted on its official blog. She described the offer as a new option for employees who may already be thinking about a future outside the company, and as another way for participating groups to adjust their workforce to changing needs. She said it builds on what Microsoft learned from a voluntary retirement program earlier this year, and that eligible employees would get an email with their personal details within hours.

Not every part of the company is taking part. Coleman wrote that participation depends on each business's priorities, customer commitments and workforce needs. According to GeekWire and Business Insider, Microsoft's sales organization isn't participating, nor are some engineering groups and corporate functions. The Verge, citing people familiar with the situation, reported that teams including Copilot, CoreAI, Windows + Devices, Xbox, finance and human resources are eligible, while marketing, security and some other groups are not.

The offer reaches further up the ladder than Microsoft's spring program. GeekWire reported that level 70 on Microsoft's internal scale includes general managers and some employees with vice president titles, but not corporate vice presidents. The company said performance isn't a factor in eligibility.

Microsoft told GeekWire it expects a much smaller share of eligible employees to accept than the roughly 30% who took the earlier retirement offer. That spring program, the first in Microsoft's history, went to about 8,750 U.S. employees whose age plus years of service met a minimum threshold, and included extended health coverage that the new offer doesn't. A person familiar with the matter told CNBC the company has no target number this time.

Microsoft also said the offer isn't a sign that it needs fewer people and isn't a replacement for layoffs, which it said remain part of its approach depending on business conditions, according to GeekWire.

The cost backdrop

Microsoft's announcement comes during a year of workforce reductions. The company cut about 4,800 jobs in July and hundreds more in September, and cut more than 15,000 jobs in 2025, GeekWire reported. Its full-time headcount was 223,000 as of June 30, down from 228,000 a year earlier, according to company filings cited by GeekWire.

CNBC reported that the move comes as Microsoft tries to balance heavy spending on data centers for artificial intelligence with keeping its finances strong. The company supplies cloud computing to AI developers including OpenAI and Anthropic. Microsoft is scheduled to report quarterly results Wednesday, Oct. 28. GeekWire noted that the company disclosed a $900 million charge tied to its retirement program in April, and that this week's report could include a cost estimate for the new offer.

What Skydance announced

Skydance's memo, signed by Ellison and Kreiz and published in full by Variety and The Hollywood Reporter, covered two changes.

The first is the office policy. The executives wrote that the company will adopt a five-day in-office schedule across all of Skydance, saying in-person work is central to the culture they want to build, especially at a creative company. They noted that many employees already work in the office full time, acknowledged the change will be significant for others, and said it will roll out location by location with ample notice. The Hollywood Reporter reported that the policy effectively brings legacy Warner Bros. Discovery employees in line with the five-day schedule Paramount already had.

The second is the Voluntary Buyout Program. According to the memo, employees who qualify will receive an individual communication laying out their personal details and terms, along with a window to decide whether to accept the one-time offer. The executives encouraged eligible employees to review their materials carefully and to bring questions to their leaders or HR, and pointed staff to internal FAQ resources. Paraphrasing the memo's closing, they said they are not taking the decisions lightly and remain confident in the company's direction.

What's expected next at Skydance

The Hollywood Reporter said the buyout program is widely expected to be the first of several cost-cutting steps. Skydance executives have said they are aiming for more than $6 billion in annual cost savings within three years, Variety reported, and part of that will come from job cuts. The Hollywood Reporter reported that Kreiz and board member Gerry Cardinale have said they don't expect most of those savings to come from staff reductions, pointing instead to technology and marketing changes.

When the merger closed on Oct. 6, Ellison and Kreiz told employees that integrating the two companies would bring difficult decisions affecting the workforce, according to Variety. Skydance hasn't said how many jobs it expects to cut. A Los Angeles County report issued in August estimated the Paramount–Warner Bros. combination could cost about 4,500 film and TV jobs in L.A. over three years, Variety reported.

There is a recent precedent inside the company. After Paramount announced a five-day office requirement last year with a buyout option for those unable or unwilling to return full time, about 600 employees in its Los Angeles and New York offices took the package, Ellison said in a shareholder letter reported by Variety in November 2025.

How voluntary buyouts typically work

A buyout is an offer of money and benefits in exchange for leaving a job voluntarily. Unlike a layoff, the employee chooses whether to take it. Companies often use buyouts to lower headcount while reducing the number of involuntary cuts later, though accepting a buyout doesn't guarantee that layoffs won't follow for those who stay, and Microsoft has said layoffs remain possible.

Packages usually come with a signed separation agreement. The U.S. Equal Employment Opportunity Commission explains that these agreements commonly ask the departing worker to give up the right to sue the employer over the job, including discrimination claims, in exchange for payments or benefits the worker wasn't already owed.

Federal law adds protections for older workers. Under the Older Workers Benefit Protection Act, as described by the EEOC, when an employer offers an exit incentive program to a group of employees age 40 and older and asks them to waive age-discrimination claims, it must give them at least 45 days to consider the agreement and seven days to revoke it after signing. The employer must also advise them in writing to consult a lawyer and disclose the job titles and ages of those who were and weren't eligible.

What workers often weigh

Employment and HR guidance from federal agencies points to several questions people commonly look at before deciding. This is general information, not legal or financial advice. It covers U.S. rules only; Microsoft's offer also includes workers in Canada, the U.K. and India, where different laws apply.

• The deadline. The EEOC's employee checklist urges workers to note the deadline right away and not wait until the last day to get advice.
• What's actually new money. The EEOC says a valid agreement must offer something beyond what the employee is already entitled to, such as earned vacation pay or vested retirement benefits.
• Health coverage. Microsoft's package includes health coverage for a fixed period, the company told GeekWire. After employer coverage ends, the federal COBRA law generally lets workers at companies with 20 or more employees keep their group plan for a limited time, but the U.S. Department of Labor notes they may have to pay the full premium plus up to 2%.
• Unemployment benefits. Each state sets its own eligibility rules, and the Labor Department says benefits generally go to people who are out of work through no fault of their own as defined by state law. Whether a buyout counts can vary by state, so workers typically check with their state agency.
• Stock and retirement. Microsoft says its package includes continued stock vesting. Workers elsewhere usually review what happens to unvested equity and retirement contributions on their departure date.
• What can't be waived. According to the EEOC, an agreement can't stop a worker from filing a charge with the agency or from claiming unemployment, workers' compensation, COBRA rights or vested retirement benefits.
• Staying. For Skydance employees, the choice may also involve whether a five-day office schedule works for them once it reaches their location.

The bigger picture: buyouts and office mandates in 2026

Buyouts remain relatively rare among the largest tech companies, which have mostly relied on layoffs, tighter performance reviews and office mandates to shrink their ranks, GeekWire noted. Microsoft's two programs this year mark a shift for the company.

Full-time office requirements have also spread. CNBC reported in February that Stellantis and Home Depot had joined employers such as Amazon, Instagram and Paramount in calling workers back five days a week, and that about a third of U.S. firms required full-time office attendance, according to workforce data firm Flex Index. Hybrid schedules remain more common overall. Among Fortune 500 companies that have published a policy, most use a hybrid schedule, according to remote-work research site Buildremote's tracker.

What's next

• Microsoft: Eligible employees have until early December to decide, according to GeekWire and CNBC, and departures would take effect Dec. 31, CNBC reported. Microsoft reports quarterly earnings Wednesday afternoon.
• Skydance: Eligible employees will receive individual offers and decision windows. The five-day office policy will phase in by location, with notice before it takes effect. Skydance hasn't announced eligibility numbers, offer terms or the scale of any job cuts.

NewsCubby will update this story as more details become public.

*Credits: reporting from Microsoft, CNBC, GeekWire, Business Insider, The Verge, Variety, The Hollywood Reporter, The Desk, Animation World Network, the U.S. Equal Employment Opportunity Commission, the U.S. Department of Labor and Buildremote. Photo: Jiaqian AirplaneFan / Wikimedia Commons, CC BY 3.0. NewsCubby articles are produced with AI assistance and reviewed by humans. This article is for information only and is not legal or financial advice.*

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