Shedding the Weak Links: Tech Giants' New Approach to Employee Performance
Microsoft imposes a two-year job prohibition for substandard former employees who wish to rejoin the company.
Major tech companies, including Microsoft, Meta, and Amazon, are stepping up their game in terms of performance-based employee management. This shift is part of a broader restructuring and efficiency drive in an increasingly competitive market.
Microsoft's Rigorous Approach
Microsoft is taking a firm stance on employee performance, introducing two key measures to identify and shed non-performing employees:
- Performance Improvement Plans (PIP): Underperforming employees are presented with two options: either enter a rigorous PIP with strict performance targets or take a severance package and leave willingly. This approach is known as the 'Global Voluntary Separation Agreement (GVSA)'. Employees are given only five days to decide once placed on a PIP[2][3].
- Rehire Ban for Low Performers: Employees let go due to low performance are subject to a two-year ban from rejoining Microsoft. This measure is applied to those who receive the lowest performance ratings or are removed via performance-based layoffs[2][3][4].
Microsoft is also focusing on 'good attrition', the idea that certain employee exits, especially those related to underperformance, are positive for the company's overall efficiency and culture[3]. In early 2025, Microsoft laid off nearly 2,000 underperforming employees. Some of these layoffs did not include severance pay, and future layoffs in May 2025 may target middle management and non-technical staff, with a focus on technical roles supporting AI and machine learning[4].
Meta's Unfolding Strategy
Details on Meta's current internal policies are scarce, but the company has, in the past, implemented performance-related layoffs and restructured to focus on efficiency. In some cases, they have publicly stated that layoffs were based on performance and company needs, often without providing detailed metrics like Microsoft's 'good attrition'[1].
Amazon's 'Pivot' Strategy
Amazon is known for its 'Pivot' program - a voluntary severance program for low-performing employees. Critics argue this program places more focus on termination targets than employee development. Microsoft's new GVSA program shares similarities with Amazon's Pivot, offering underperformers a choice between a severance package and a performance improvement plan[2].
A quick look at the industry paints a picture of shifting priorities. The tech sector is moving towards more aggressive performance management and staffing strategies, signaling a need for improved accountability and a focus on emerging technologies like AI[4].
[1] https://www.bloomberg.com/news/articles/2022-11-16/facebook-catches-pivot-fever-and-offers-employees-voluntary-exits[2] https://www.axios.com/newsletters/tech-tonic/2023-02-14_546[3] https://www.businessinsider.com/microsoft-good-attrition-performance-management-pip-2025-2[4] https://www.businessinsider.com/microsoft-to-cut-middle-management-non-technical-roles-in-2025-2025-2
- The defi market in finance might be intrigued by the tech industry's recent focus on underperforming employees, as major tech companies like Microsoft, Meta, and Amazon are enacting stricter performance-based management.
- After introducing a Performance Improvement Plan (PIP) for underperforming employees, Microsoft has imposed a two-year ban on rehiring those who leave due to low performance, signifying a shift in employee retention strategies.
- In the coming months, tech giants may also face challenges related to tariffs and technology, as the industry aims to stay competitive and focus on emerging fields like AI.
- Amidst this restructuring, some tech employees might consider exploring opportunities in the defi market, as it offers unique finance solutions and could potentially provide a more nurturing work environment for employees seeking growth and career development.
