In a bold move aimed at elevating employee performance standards, Microsoft is intensifying its scrutiny of underperforming employees through the introduction of new policies, as highlighted in an internal email from Chief People Officer Amy Coleman. The tech giant is implementing a formalized Performance Improvement Plan (PIP) system, which presents struggling employees with two distinct options: they can either agree to specific improvement targets or opt to exit the company under a Global Voluntary Separation Agreement.

Importantly, this new policy includes a stringent two-year rehire blackout period for any employees who leave the company with low performance ratingsdefined as scores between zero and 60% on Microsoft's 0-200 scaleor those who are part of the PIP process. This means that employees who exit under these circumstances will not only be barred from internal transfers while still employed but will also face significant hurdles if they wish to return to Microsoft in the future.

This latest initiative comes just months after Microsoft made headlines by terminating approximately 2,000 employees deemed to be underperforming, and notably, these terminations occurred without any severance packages. In the wake of these layoffs, the company is also investing in the development of AI-supported tools designed to assist managers in conducting both constructive and challenging conversations with their team members. These interactive practice environments aim to equip managers with the skills necessary to navigate difficult discussions more effectively.

In her email, Coleman emphasized that the companys overarching focus remains on enabling high performance to meet its pressing priorities, which include enhancing security measures, ensuring product quality, and leading advancements in artificial intelligence. She articulated that these changes are intended to cultivate a globally consistent and transparent experience for all employees while fostering a culture of accountability and growth. This strategic shift reflects Microsoft's commitment to not only achieving its business goals but also maintaining a work environment that encourages continuous improvement and professional development.