Last Updated:
Microsoft is overhauling its employee performance policies with a strict two-year rehire ban for workers terminated due to poor performance
Microsoft Bans Rehiring Poor Performers for Two Years
Microsoft is overhauling its employee performance policies with a strict two-year rehire ban for workers terminated due to poor performance—a marked shift from its previously growth-oriented culture. The change, detailed in internal documents obtained by Business Insider, also includes a controversial new metric called “good attrition,” which tracks employee exits considered beneficial to the company.
The move comes after Microsoft reportedly terminated around 2,000 employees deemed underperformers without severance, as part of an aggressive push to accelerate workforce optimization and block low performers from returning.
Exit or Improve: New Performance Policy
Employees who are flagged for poor performance now face two options: enter a performance improvement plan (PIP) with specific targets and timelines, or opt for a voluntary exit package equal to 16 weeks of pay.
An internal memo from Chief People Officer Amy Coleman outlines the restrictions: employees with a “zero or 60% Rewards outcome” or those currently on a PIP are barred from internal transfers. Those who exit during or after a PIP—or leave with a subpar Rewards score—will be ineligible for rehire for two years.
Tech Giants Shift to Tougher HR Policies
Microsoft’s updated policies reflect a broader trend in the tech industry, where companies are tightening performance standards and reducing tolerance for underperformance. Rivals have already adopted similar practices: Amazon uses an “unregretted attrition” metric, while Meta flags certain exits with “do not rehire” markers.
Analysts say the trend ends the era of generous workplace perks and leniency. Microsoft’s latest strategy, critics argue, represents a stark departure from the “growth mindset” ethos championed by CEO Satya Nadella since 2014, replacing it with a more hardline approach to workforce management.
- First Published:
