Oracle rebuffs laid-off workers' severance negotiation attempt

It was widely reported that Oracle laid off an estimated 20,000 to 30,000 employees via email on March 31.

One of the employees laid off that day shared their experience with TechCrunch: “I had this strange feeling in my stomach. I tried to log into the VPN, and it said, ‘this user doesn’t exist anymore.’ Then I called a friend and asked, ‘Can you see me on Slack?’ She replied, ‘No, your account has been deactivated.’”

Shortly after, the employee received an email stating their position was terminated immediately. The severance offer arrived a few days later. However, Oracle’s terms quickly became a source of dispute, and some laid-off employees pushed back.

Oracle offered fairly standard corporate America severance terms to laid-off employees. In exchange for signing a release waiving their right to sue, employees received four weeks of pay for the first year, plus one additional week per year of service, up to a maximum of 26 weeks. The company also covered one month of COBRA insurance.

The catch: Although stock compensation often constitutes a significant portion of a tech worker’s pay, especially at Oracle, the company did not accelerate RSUs that were about to vest. Any shares that had not vested by the termination date were forfeited.

This applied even to stock granted as retention incentives or in lieu of salary increases tied to promotions. According to Time, one long-tenured employee lost $1 million in stock that was just four months away from vesting; RSUs constituted about 70% of his compensation.

Some employees also discovered that if they were classified as remote workers by the company and did not work in a state with stronger worker protections, such as California or New York, the company claimed they were not eligible for WARN Act protections.

The WARN Act requires companies conducting mass layoffs to provide employees with two months' notice before termination. It is triggered when 50 or more employees are affected at a single location. By classifying employees as remote workers, the company can bypass the minimum location requirements.

Some employees were unaware they were classified as remote workers because they lived near an office and worked a hybrid schedule.

Even if they were covered by the WARN Act, this did not necessarily mean extended severance, according to the former Oracle employee. That's because Oracle included the two months of WARN notice pay in its existing calculation of four weeks plus one week per year.

For a brief period, a group of employees attempted to collectively negotiate with Oracle, according to a letter seen by TechCrunch. At least 90 people signed a public petition urging the database and cloud computing giant to match the severance terms of other major tech companies that were conducting mass layoffs in the name of AI.

For example, according to an email published by Business Insider, Meta's severance package started at 16 weeks of base pay, plus two weeks for every year of employment, and included COBRA coverage for 18 months.

Microsoft, which offered voluntary retirement packages to long-serving employees, provided accelerated stock vesting, a minimum of eight weeks' pay, and an additional one to two weeks for every six months of service, depending on rank, according to the Seattle Times.

Cloudflare, which recently laid off 20% of its workforce, offered a lump sum severance equivalent to base pay through the end of 2026, plus health insurance coverage through the end of the year, and accelerated stock vesting through August 15. So if an employee was close to receiving another tranche, they would get it.

Oracle declined to negotiate, according to an email seen by TechCrunch. It was a take-it-or-leave-it situation, the employee said.

When asked about its severance terms, the classification of employees as remote, and the employees' failed attempt to negotiate, Oracle declined to comment.

Such a reaction from the company is not surprising, even to those who hoped to negotiate. But it highlights that despite the theoretical high pay (often through stocks) and perks that tech workers enjoy in an employee's market, they have very few protections when the market shifts.