Microsoft (MSFT) , which has over 120,000 employees in the U.S., has recently undergone dramatic changes in its workforce, following major trends in corporate America.
Like many other companies, Microsoft quietly laid off its diversity, equity, and inclusion team in July last year due to “changing business needs.”
💵💰Don’t miss the move: Subscribe to TheStreet’s free daily newsletter 💰💵
Also, in October, as many companies cracked down on remote work, Microsoft warned its staff during an internal meeting that it is not planning on requiring them to work in the office five days a week, unless it notices a lag in productivity.
Related: Amazon CEO gives hard-nosed message to employees
Microsoft later doubled down on high productivity by confirming in January that it is planning job cuts this year, with a focus on targeting underperforming employees.
“At Microsoft we focus on high performance talent,” said a Microsoft spokesperson in a statement in January. “We are always working on helping people learn and grow. When people are not performing, we take the appropriate action.”
It later fired roughly 2,000 low-performing employees without severance.
Microsoft rolls out a harsh policy
Now, it appears that Microsoft is starting to make more progress toward tackling poor performers within its company.
Microsoft Chief People Officer Amy Coleman recently emailed managers to inform them that the company will be rolling out “new and enhanced tools” to help them “accelerate high performance and swiftly address low performance,” according to a new report from Business Insider.
“Our focus remains on enabling high performance to achieve our priorities spanning security, quality, and leading Al,” said Coleman in the email. “This focus and our growth mindset encourage excellence, motivates us to push ourselves through challenges, and enables us to deliver results.”
One of these tools includes putting low-performing employees on a Performance Improvement Plan (PIP), which has “a new globally consistent approach to set clear expectations and a timeline for improvement.”
Related: Starbucks CEO has a tough message for employees after layoffs
“The employee can accept the improvement plan or choose to transition out of the company with the offer of a Global Voluntary Separation Agreement,” said Coleman.
She also said that if an underperforming employee exits the company, they will be banned from getting rehired or transferred to another part of the company for two years.
“Employees with zero and 60% Rewards outcomes and/or on an active PIP will not be eligible for internal transfers,” said Coleman. “Former employees who left with zero or 60% Rewards or during/after a PIP will not be eligible for rehire until two years after their termination date.”
Microsoft appears to be taking notes from Meta
The move from Microsoft follows in Meta’s footsteps. In January, Meta CEO Mark Zuckerberg sent a memo to employees warning them that the company is planning to cut roughly 3,600 jobs, which is about 5% of its workforce, amid its recent efforts to develop artificial intelligence, smart glasses, and “the future of social media.”
Zuckerberg said the job cuts would be based on performance, and the company will hire new employees this year to replace those who are fired.
More Retail:
- AT&T quietly issues stern warning to customers
- Sam’s Club makes a big change to a beloved membership perk
- GameStop announces risky move amid store closures
“I’ve decided to raise the bar on performance management and move out low-performers faster,” said Zuckerberg in the memo.
However, this effort took an unexpected turn when some employees who were let go claimed that they were “blindsided” by being fired, since they had recently received positive performance reviews.
It was later revealed that Meta secretly keeps “block” lists containing former fired or laid-off employees who are not eligible for rehire despite having a history of good performance at the company. The lists allegedly don’t just apply to workers who have violated the company’s workplace policies or performed poorly.
Related: Veteran fund manager unveils eye-popping S&P 500 forecast
