Microsoft 365 removal of unused overages

Effective October 1, 2021, Microsoft will start to remove excess overallocated Microsoft 365 licenses. Microsoft 365 commercial customers using 95 percent or less of their purchase count will see the removal of unused overages that were made available prior to the updated overallocation process. This is the final step in the changes to how licenses are allocated.

Prior to recent updates to Microsoft’s license overallocation process, Microsoft provided customers with access to incremental excess licenses. This would help in situations such as step-ups from Microsoft 365 E3 to E5 without potential interruptions due to lack of available licenses. But because these incremental, unpaid licenses led to compliance risks for the customers, they are being removed from the system. Customers will continue to be protected from loss of service through the updated overallocation process.

For customers who haven’t transacted a qualifying license transition order, any existing (fixed-value) unused overallocation will be reset to zero starting October 1, 2021.

Customers need to do the following to prepare for the change:

  • If customers only assign licenses using the Microsoft 365 Admin Center user interface, this message is just for awareness.
  • If customers use license assignment workflow automation – for example, via Microsoft PowerShell scripting – and their automation logic permits assigning more licenses than they own, they will need to update the automation logic to avoid an overallocation.
  • To avoid potential process failure, customers should update the automation logic before October 1, 2021.
  • Note that already licensed users won’t see any loss in or impact on their service.
  • If customers use group-based licensing, they should periodically verify that the available licenses are adequate for their group membership counts.
  • If customers anticipate having an insufficient number of licenses to meet their needs, they might be able to place a license reservation in the Microsoft Volume Licensing Service Center or place an order through SCHNEIDER IT MANAGEMENT.

For more information about licensing, including license reservations and how to make a license reservation, please visit:

Please contact us for more information and to request a quote.

Share article


Get Free Expert Software Licensing Consultancy For Your Organization