Microsoft cuts back on worker benefits

Goal is to reduce expenses by 21% Microsoft Corp., the world's largest software company, will cut vacation time for new employees and charge US workers a $40 copayment for brand-name prescription drugs as part of plans to cut costs as sales growth declines.

Microsoft also will reduce the discount for employee stock purchases to 10 percent from 15 percent starting in July, spokeswoman Tami Begasse said. Using generic drugs can save Microsoft as much as 80 percent in prescription costs compared with brand-name drugs, she said.

Chief financial officer John Connors wants to reduce operating expenses by 21 percent next year to about $21.9 billion to boost profit as sales slow. Microsoft has forecast revenue to grow as little as 3.4 percent next fiscal year, compared with the 14 percent it expects for the year ending next month.

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