Microsoft Asks For a Refund From Laid-Off Workers [updated] 424
An anonymous reader writes "The large print giveth, the small print taketh away. Microsoft, which recently laid off 1400 employees, is now claiming that some of those lucky schmoes were inadvertently overpaid on their severance package. A letter from the company, which was subsequently circulated on the internet, states: 'We ask that you repay the overpayment and sincerely apologize for any inconvenience to you.' Microsoft has confirmed the authenticity of the letter, but it's not known what the amounts in question are, or how many of the 1400 were affected." Update: 02/24 14:00 GMT by T : VinylRecords writes "Well, now Microsoft has recanted, saying that the situation has resulted in unfortunate amounts of bad press and public relations. 'This was a mistake on our part,' said a Microsoft spokesman in an e-mailed statement. 'We should have handled this situation in a more thoughtful manner.'"
Re:Large, unmarked bills. (Score:5, Interesting)
That's one of the reasons. If the overpayment is small enough, it wouldn't be worth the bad PR to sue their former workers. They also have a poor chance of winning in a trial by jury- people are going to be biased for the workers. Besides, asking for the money politely doesn't stop them from filing legal proceedings later- in fact, judges prefer you to try to fix issues before filing papers.
most likely the employees could just keep it (Score:5, Interesting)
Re:Large, unmarked bills. (Score:3, Interesting)
Well, they're probably SOL regardless (unless the sum involved was absurd.) They chose to terminate the employee, they chose the terms, they asked for a promise to not sue (for overtime, unused vacation, discrimination, etc) in exchange for some cash. They paid, and now think they paid the wrong amount: good luck winning this one in court.
Re:Why some people think MS is incompetant (Score:5, Interesting)
they risk bad publicity to get the overpayment back
You think MS cares about bad press anymore? In my recent memory... The Zune date bug, the failure of many 360s, DRM schemes in everything, the disaster that was Vista, and the meh responses from the media for any of their new endeavors.
I honestly don't think that MS has any more credibility to ruin.
Pay it in vouchers (Score:5, Interesting)
In the past, Microsoft has settled fines by giving away the fine value in money-off vouchers for schools to buy cheaper copies of Windows (in areas where the schools had tended to use the competition's systems, naturally).
These workers should do the same thing. Print up a few dozen vouchers for $100 off a week's contracting rate.
Re:Large, unmarked bills. (Score:5, Interesting)
As I said, "absurd" numbers are easy to fix, but even $18K is tough to clawback from, for example, an employee with a five year work history. Heck, when I quit my last job, a nice lady from HR emailed me asking about unused vacation days: I picked a number, and it was close to $18K pre-tax.
Dollar numbers seem so important in entry level positions, but, at the higher levels, $BIGNUM amounts are used to smooth over the issues that arise in terminations.
Re:Technically they are right (Score:3, Interesting)
I agree. This happens all the time. Accountants and HR people are just human, and they make mistakes. Sure, the systems are mostly automated, but when there are exceptional events or conditions change (this WAS Microsoft's first massive layoff), mistakes happen, and people pay it back all the time. The same way if they underpay you, they'll give it back.
Now, the only difference is those are people who got fired...so unless there's a legally binding agreement over this package (like, if something was signed...which it probably was), they have no reason to pay back, and they're probably not in the mood to do so. But again, if they signed papers, they don't have much choice.
Also, MS has offered to help some of these people to get new jobs, and even may hire some of them back in the future. Thats typical in IT in general. So unless some of these people REALLY hate Microsoft to the level of an average slashdotter, its not in the former employee's best interests to screw their former employer over. May cause issues getting references too, if t he direct supervisors catch ear of it.
Re:I think I am not unique in saying.... (Score:5, Interesting)
A good company will be one that treats me as a partner, not as a coding machine. Such companies exist, and I've worked for them, even if they are rare (but becoming less so!). Even in manufacturing, companies like that exist. One example is Springfield Remanufacturing Corporation. [srcreman.com] It is an employee owned company. The management doesn't consider itself better than the rest, they work as a team, and they don't have layoffs. They have an open system, where the employees actually understand what management is doing, instead of just being told to do it. If someone is having trouble doing they job, instead of firing them, they get taught how to do better. Maybe they don't have free massages for the workers, but the workers are treated like human beings, who have judgement and capabilities, and they get their fair share.
I suggest reading "The Great Game of Business." Although the book is targeted towards management, it completely changed my idea of what a company can be, and it's not a free xbox.
Had a previous employer overstate wages (Score:3, Interesting)
And when a large group of us applied for unemployment, we got more than we should have.
After a few months, we all got a letter from the unemployment office wanting the extra money back. Good luck with that, except I still owe them money and the debt never goes away.
If I ever get laid off again, I can't draw a penny until the original amount is paid off out of what I will draw if I end up unemployed again.
When it was all over, the unemployment office sent me a postcard asking what I thought about my experience with them. I sent them a postcard back that was just short of having a federal marshal knock on my door. If I was at home right now, I would post a copy of it. It was a laugh riot.
transporter_ii
Re:I think I am not unique in saying.... (Score:5, Interesting)
When I quit at Amazon, they actually offered me a legal document (optional, of course) promising them that I wouldn't sue for giving references. If you sign it, they'll allow your manager/coworker to give references, if not they only gave name, rank, and serial number. If you think the references would be good you sign it, if not you don't. I expect to see more companies doing that in the future.
Re:No accident (Score:5, Interesting)
Oh man, no joke.
Guys used to have mysterious allotments coming out of their LES' now and then, with little recourse to find out other than some pay clerk telling you to do a "pay inquiry". Over-payments, no-pay-due's, all kinds of random stuff that was just inevitable in a paper-and-red-tape bureaucracy.
Re:Had a previous employer overstate wages (Score:5, Interesting)
And when a large group of us applied for unemployment, we got more than we should have.
After a few months, we all got a letter from the unemployment office wanting the extra money back. Good luck with that, except I still owe them money and the debt never goes away.
If I ever get laid off again, I can't draw a penny until the original amount is paid off out of what I will draw if I end up unemployed again.
That's because it is the government. When I worked for Uncle Sam, if he overpaid you he simply took it out of the next check you got. OTOH, if he underpaid you you also got it on the next check with no hassles.
Private industry is a bit different. years ago I got one of those letters from a previous employer. I eventually got around to sending them a check. A few months letter I got a check from them saying they had underpaid me. Go figure...
MS, OTHO, may be doing this not so much as to collect the money but to avoid lawsuits. If someone discovered they used different ways to calculate severance for the same agreements they could wind up in court. This way, they can at least say "We messed up, but once we found out we tried to fix it." Even if the employees don't pay it back and MS doesn't go after them at least they can show thwy tried; and fixed underpayments as well.
This of course is conjecture on my part; but my experience is it is not uncommon for companies to mess up severance payments. Even when I left Uncle Sam it took several months for me to get a "final" check that zeroed me out.
Re:No accident (Score:5, Interesting)
Yeah, my father was in the Navy and had this kind of thing happen all the time. Once even the other way around, where DFAS paid much less than normal and "caught up" with next month's payment while my parents were scrambling around going WTF.
I hear of this kind of thing much less frequently nowadays though. I joined myself and haven't had problems, although our Chief of the Boat managed to run afoul of a DFAS screwup.
Re:they probably are owed it (Score:3, Interesting)
Unsolicited packages that come in the mail addressed to you are yours to keep, free of any compensation or request for return. How is this different? Especially when there is no longer any contractural relationship between the parties (and they went out of their way to sign papers to that effect). Any over-payment, in that case, IS a gift. Also, as a gift, if it's below a certain amount ($13,000.00 [wikipedia.org], it's tax-free.
And no, "Gifts from certain parties will always be taxed for U.S. Federal income tax purposes. Under Internal Revenue Code section 102(c)[3], gifts transferred by or for an employer to, or for the benefit of, an employee cannot be excluded from the gross income of the employee for Federal income tax purposes" doesn't apply - they're not employees, and weren't employees when they discovered the "gift." They can tell Microsoft to pound sand. Unless the amount is in the hundreds of thousands per employee, this was a stupid move. Oh wait - this is Balmer we're talking about. Zune Boy.
Re:No accident (Score:3, Interesting)
Nice that you pointed out that Microsoft is not the first and only company or organization to ever make a payroll error. But where did you come up with the anti-"big evil corporate America! Waaah!" jab, based on this event?
Re:No accident (Score:5, Interesting)
Usually, the "official" termination date occurs at the end of the severance period. Most companies retain the "right" to recall you from your enforced sabbatical during that period.
Re:most likely the employees could just keep it (Score:3, Interesting)
If I (Score:4, Interesting)
We can get a rough idea of the overpayment (Score:5, Interesting)
At least how many digits we're talking about...
Most fonts keep numbers monospaced. Other characters in the fonts may have variable widths, but almost all fonts keep numbers the same width. This has to do with lining numbers up in columns when doing reports.
I measure about six pixels per number. The zip code is about 30 pixels wide (6 pixels x 5 digits = 30).
The blanked out area is 42 pixels wide. Now some of that is two spaces and a decimal point. Spaces look about 4 pixels and a decimal point is probably 2 or 3 pixels (it's hard to tell since the document was scanned in anti-aliased). That leaves 42 pixels - 3 pixels (decimal) - 8 pixels (spaces). About 32 pixels, or about 5 digits. Put 2 on one side of the decimal, and that leaves a number between $100 and $999 as an overpayment.
Actually, this sounds about right for a math error of this type, and isn't too unusual based upon the complexities of this type of payout which includes includes considering the base salary, bonus payouts, unused vacations, unused sick leave, years in service, ranking, etc. Add in some government specific stuff, 401K vestments, stock plans, and who knows what else, and you can see how complex this can get.
Still, it's hard to understand all of this: Microsoft laid off 1,400 people. If each of them received what seemed to be about $1000 in overpay, you're talking about $1.4 million dollars at the very most. If the average mistake was $300 and only 1/2 the people got that, you're talking about $200,000 (a more likely, but still quite large sum).
Heck, the paper work alone to send out these letters and to track them probably costs Microsoft more -- not to mention the bad will and publicity it'll generate.
Re:Were the checks paid on Windows 95 OS computer (Score:3, Interesting)