Microsoft Implements Stricter Performance Management System With Two-Year Rehire Ban

Microsoft is intensifying performance scrutiny through new policies that target underperforming employees, according to an internal email from Chief People Officer Amy Coleman. The company has introduced a formalized Performance Improvement Plan (PIP) system that gives struggling employees two options: accept improvement targets or exit the company with a Global Voluntary Separation Agreement.

The policy establishes a two-year rehire blackout period for employees who leave with low performance ratings (zero to 60% in Microsoft's 0-200 scale) or during a PIP process. These employees are also barred from internal transfers while still at the company.

Coming months after Microsoft terminated 2,000 underperformers without severance, the company is also developing AI-supported tools to help managers 'prepare for constructive or challenging conversations' through interactive practice environments. 'Our focus remains on enabling high performance to achieve our priorities spanning security, quality, and leading AI,' Coleman wrote, emphasizing that these changes aim to create 'a globally consistent and transparent experience' while fostering 'accountability and growth.'

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