Your Leavers' OneDrives Are on a Countdown

If someone left your company before July and you removed their licence, their OneDrive is probably already archived. Nobody can open it, not even an admin, until someone pays. And from July 2027, Microsoft can start deleting it.

This week: what Microsoft changed in OneDrive and SharePoint storage, and the offboarding decision most SMEs have never made on purpose.

What shipped (and what’s going away)

Unlicensed OneDrive accounts now have a fixed lifecycle. Since July 2026, a OneDrive without a licence goes read-only at day 60 and is archived at day 93. After 365 cumulative unpaid days it can be deleted. For accounts that were already unlicensed on 1 July 2026, the clock started that day, so the earliest deletion date is 1 July 2027. Archive storage costs $0.05 per GB per month, plus $0.60 per GB to reactivate. A paid “Standard storage” option can also keep an unlicensed account active for longer before it is archived. (Microsoft Learn: unlicensed OneDrive accounts, Message Center MC1381110)

For an SME: the important line is in Microsoft’s FAQ. An unpaid account that reaches 365 days can be deleted even if retention policies or holds apply. Do not rely on a retention policy to protect a leaver’s files.

Pay-as-you-go storage is coming to SharePoint and OneDrive. SharePoint’s consumption meter (MC1330893) reaches general availability between early and late November 2026, after Microsoft pushed it back from an earlier date. The OneDrive version (MC1477185) is in public preview now, with general availability from early November to early December. Both are opt-in and billed through an Azure subscription.

For an SME: useful if storage grows unpredictably, but read the fine print. Topedia, who tested the SharePoint preview, reports that the policy applies to all users regardless of what you select, that over-quota alerts disappear once enrolled, and that there is no spending cap. Set a budget alert in Azure before you switch it on.

Going away: OneDrive quotas above 5 TB. Tenants that got support-approved expansions up to 25 TB received MC1465765. From November 2026 to February 2027, users above 5 TB become read-only until they drop below it. Few SMEs are affected, but if you got the notice, you have weeks, not months. (Office 365 for IT Pros)

In focus: what happens to a leaver’s OneDrive?

The situation. Someone leaves. IT blocks sign-in and removes the licence the same day, because the licence costs money. Three months later the manager needs a contract that only existed in that person’s OneDrive.

The options.

• Keep the licence for a transition period. Simple, and the account stays fully accessible. You pay a full seat for a mailbox and a OneDrive nobody uses.
• Move the content before removing the licence. Business files go to a SharePoint or Teams site, or to the manager. Then let the account expire on purpose.
• Let it archive and pay for archive storage. Cheap per GB, but nobody can open it until you reactivate it, at $0.60 per GB.
• Delete it deliberately. Correct when nothing in it has business or legal value, and there is no retention obligation.

The criteria.

• Choose move first as the default. A OneDrive is a personal workspace; company records should never depend on one person’s account.
• Choose keep the licence only for a short, dated transition: a handover, an open project, a pending dispute.
• Choose archive when you have a legal or compliance reason to keep everything and expect to almost never open it.
• Choose delete when the content was moved and nothing else needs to be kept. Write that decision down.

The hidden cost. The archive tier looks cheap until someone asks for a file. Reactivating a 100 GB account costs around $60, and access can take a day or two to come back. And once you turn on billing to reactivate one account, the monthly archive fee applies to every unlicensed account in the tenant that is past day 93, not just that one. Multiply by every leaver since you moved to Microsoft 365 and the “free” offboarding becomes a line item. The bigger cost is the one you don’t see: deletion at day 365, with no warning to the manager who assumed the files were still there.

What we would do. Put the move into the offboarding checklist, before the licence is removed, with the manager confirming nothing is missing. Then let the account expire, and check the OneDrive accounts report monthly.

Picture a 25-person accounting firm that removed the licences of three leavers to save money. A client audit asks for working papers, and the files are in one of those OneDrives. Restoring access costs a licence, a day of waiting and an awkward call. After that, the offboarding checklist gets one extra line.

Do this week

1. In the SharePoint admin center, go to Reports, then OneDrive accounts, and select View more details. Count the unlicensed accounts and check the “Deletion scheduled on” column.
2. For each one, decide: re-license, move, pay for archive, or delete. Do not leave it as “we’ll see”.
3. Add one line to your offboarding checklist: “Move business files out of OneDrive before removing the licence.”

Forward this to whoever handles your leavers. That person is often not in IT.