Bruno Koba
What Happens to Your RSUs When You're Laid Off (And What to Do in the First 30 Days)
Getting laid off is disorienting enough without having to decode your equity compensation on the same day. But if you have unvested RSUs, what happens to them when you're laid off is one of the most financially consequential questions you'll face — and most HR departments won't give you the full picture.
This guide covers exactly what happens to your RSUs when you're laid off, what you can negotiate, and the three moves every tech worker should make in the first 30 days.
Table of Contents
Vested vs. unvested RSUs: the split that matters
What your company will (and won't) tell you
Can you negotiate for more vesting?
3 financial moves to make in your first 30 days
Should you sell your vested shares now?
The tax angle you can't ignore
FAQ
Vested vs. Unvested RSUs: The Split That Matters
When your employment ends — whether through a layoff, resignation, or firing — your RSUs split into two very different buckets.
Vested RSUs are yours. They already converted to actual shares on your vest date. A layoff doesn't touch them. You own those shares the same way you'd own shares you bought yourself in a brokerage account.
Unvested RSUs are forfeited. The moment your employment ends, any RSUs that haven't vested yet go back to the company. This is true whether you were a top performer laid off in a cost-cutting round or a new hire who joined two months ago. The default treatment in nearly all equity plans is: unvested = gone.
The critical number to find right now is how many unvested RSUs you have and when they were scheduled to vest. If you're six weeks away from a large vest date, that's worth fighting for.
What Your Company Will (and Won't) Tell You
HR will typically give you a severance letter that outlines your last day, pay, and COBRA information. What it often won't spell out clearly:
Exactly how many RSUs you're forfeiting and their current value
Whether the company has any discretion to accelerate vesting (they often do)
The window you have to sign the severance agreement — and that this window is negotiable
Don't rely on verbal assurances from your manager or HR. Pull up your original grant agreements, check your equity platform (Carta, Shareworks, Fidelity NetBenefits, etc.), and get the exact numbers before you sign anything.
Can You Negotiate for More Vesting?
Yes — and more often than people realize, this negotiation works.
When accelerated vesting is on the table
Companies are most willing to accelerate vesting when:
The layoff is part of a broad reduction in force, not performance-related
You have a vest date coming up within 60–90 days
Your role was senior or involved access to sensitive information
You were a long-tenure employee with a strong track record
Some equity plans include automatic "single trigger" or "double trigger" acceleration clauses that kick in during a layoff or acquisition. Check your plan documents for this language before you negotiate — you might already be entitled to more than you're being offered.
How to ask
The leverage window is before you sign the severance agreement. Once you sign and release claims, what's done is done.
A simple, direct ask works well: "I have X RSUs vesting on [date]. I'd like to discuss whether the company can accelerate those as part of my severance package." Most companies expect you to negotiate, and a reasonable ask rarely burns a bridge.
Even partial acceleration — getting one more vest tranche — can be worth tens of thousands of dollars.
3 Financial Moves to Make in Your First 30 Days
Once the immediate shock passes, these are the three things that will have the biggest financial impact.
1. Get a complete picture of your equity
Log into your equity platform and document every grant, its vest date, and how many shares have vested vs. remain unvested. Note the current market value of your vested shares. If you also hold stock options, check your post-termination exercise window — for ISOs, that's typically 90 days.
Many people have vested shares sitting in a brokerage account they haven't thought about in months. This is the moment to take stock of everything.
2. Decide what to do with your vested shares
You now own shares in your former employer with no employment requirement attached. The question shifts from when do these vest to does it make sense to hold them.
For most people, the answer leans toward selling — not necessarily all at once, but intentionally. You're already losing your income from this company. Holding a large concentration in their stock means you're doubling down on a company you no longer work at. As an SEC-registered investment advisor, Astor typically flags any situation where a single stock makes up more than 10% of a client's portfolio as a concentration risk worth addressing.
Astor can help you build a diversification plan that accounts for your vested shares →
3. Plan for the tax impact
If any of your RSUs vested this year before the layoff, you already have ordinary income to report. The company withholds taxes at vesting, but that withholding is often set at the flat supplemental rate (22% federal), which may not cover your actual marginal rate if you had a high-income year.
If you negotiate accelerated vesting as part of your severance, that entire value is taxable as ordinary income in the year it vests. A $150,000 accelerated vest creates a significant tax liability worth planning for well before April.
Should You Sell Your Vested Shares Now?
This is the question that deserves the most careful thought. The right answer depends on a few variables:
Sell immediately if: your former employer's stock is already a large chunk of your net worth; you need liquidity; you believe the company's prospects have weakened; or you've held long enough to qualify for long-term capital gains treatment.
Hold if: you believe the stock will meaningfully appreciate; you're close to the one-year mark from vest date and the tax savings outweigh the risk; or the position is a small percentage of your overall portfolio.
The wrong answer is to do nothing by default. Inaction is a choice — often an expensive one. Our piece on the real cost of doing nothing with your money breaks this down in more detail.
For more on RSU tax strategy, see our guide on RSU tax strategies for tech workers.
The Tax Angle You Can't Ignore
A few tax mechanics worth understanding clearly when RSUs are involved in a layoff:
RSUs vest as ordinary income. Per the IRS, when RSUs vest, their fair market value on the vest date is included in your W-2 as wages. You don't get to choose when this happens.
Your cost basis is the vest-date price. If shares vested at $50 and now trade at $65, you only owe taxes on the $15 gain — not the full $65. Make sure your broker has the correct cost basis on file; many don't, especially if shares transferred between custodians.
Capital gains rates apply after the vest date. Hold your shares less than a year from the vest date and you pay short-term capital gains (ordinary income rates). Hold longer than a year and you qualify for long-term rates — potentially saving 15–20% on your gains.
If you're unsure how all of this applies to your specific situation, Astor's advisors can help you model the tax impact before you make any moves.
Frequently Asked Questions
What happens to unvested RSUs if I'm laid off?
Unvested RSUs are forfeited when your employment ends. Unless your severance agreement includes accelerated vesting, you lose any RSUs that hadn't yet vested on or before your last day of employment.
Do I keep my vested RSUs if I'm laid off?
Yes. RSUs that have already vested converted to shares and belong to you outright. A layoff has no effect on shares you already own — they remain in your brokerage account.
Can I negotiate accelerated vesting in a layoff severance?
Yes, and it's worth trying — especially if you have a vest date coming up within 60–90 days. Companies doing broad layoffs often have flexibility, and the ask should happen before you sign the severance agreement. Even one additional vest tranche can be worth tens of thousands of dollars.
How are RSUs taxed when I'm laid off?
RSUs vested before or during the layoff are taxed as ordinary income in the year they vest. If your severance package includes accelerated vesting, those shares are also taxed as ordinary income in the year they accelerate. Capital gains rules only apply to any appreciation after the vest date.
Should I sell my company stock after a layoff?
It depends on your overall financial picture, but concentration risk is real. Holding a large position in your former employer means you're betting on a company you no longer have inside knowledge of. A financial advisor can help you model a tax-efficient diversification strategy.
What happens to stock options (not RSUs) when I'm laid off?
Stock options have a separate post-termination exercise window — typically 90 days for ISOs and longer for NSOs, depending on your plan. Check your grant documents carefully. Unexercised options expire after this window with no recovery.
What if I'm close to a vest date when I'm laid off?
This is the best scenario for negotiating. If you're within 60–90 days of a significant vest, lead with that in your severance negotiation. Even getting one additional vest tranche can make a meaningful difference in your total severance value.
This article is not personalized financial advice. For personalized guidance tailored to your situation, Astor is an SEC-registered investment advisor that provides personalized recommendations.