Microsoft Cracks Down On ‘Low Performers’ In A New Internal Memo; Check Details

Microsoft's performance review system is based on a 0–200 scale, which influences stock awards and cash bonuses tied to individual contributions, as per the report

As a part of the updated performance management framework, Microsoft has introduced a formal exit option for underperforming employees, states the report

Source : Microsoft

Microsoft has introduced new measures to address employee underperformance, including a two-year re-hiring ban for those deemed underperformers. The move comes just weeks after the tech giant reportedly laid off around 2,000 employees without severance, citing poor performance.

According to an internal email obtained by Business Insider, the company has rolled out “new and enhanced tools” aimed at helping managers more effectively manage low-performing employees. Chief People Officer Amy Coleman outlined that the tools are designed not only to “swiftly address” performance issues but also to “accelerate high performance,” as Microsoft intensifies its focus on accountability and growth.

As a part of the updated performance management framework, Microsoft has introduced a formal exit option for underperforming employees. Those who leave under this category will now be barred from transferring internally or being rehired for a minimum of two years, states the report.

Microsoft Tightens Performance Policy Amid Layoff Speculation

In an internal email, Microsoft detailed stricter performance management policies, giving underperforming employees a choice: enter a Performance Improvement Plan (PIP) or exit the company. Employees receiving zero to 60 per cent in performance rewards or currently on a PIP will no longer be eligible for internal transfers. Additionally, former employees who exited under similar circumstances will be barred from rehire for two years following their termination date, said the report.

Microsoft's performance review system is based on a 0–200 scale, which influences stock awards and cash bonuses tied to individual contributions, as per the report.

These policy changes come amid reports of an impending round of layoffs expected in May. According to a Business Insider report, the upcoming cuts are likely to impact mid-level managers and employees in non-technical roles. Sources familiar with the situation noted that some teams at Microsoft are aiming to increase their "span of control"—effectively reducing the number of managers by assigning more direct reports to each.