Athira Sethu
Kochi, 26 April 2025
Microsoft has unveiled a new strategy to address employees who are not living up to expectations. Rather than thrust them into a rigid improvement program, the company is now offering them an alternative: accept a payout and depart the company.
As per reports, Microsoft will provide 16 weeks of compensation to underperforming staff who voluntarily leave the company. The plan is comparable to Amazon’s “Pivot” program, which has been criticized by some for forcing employees out instead of improving them.
This shift came in an internal memo from Microsoft’s new Chief People Officer, Amy Coleman, to company managers on April 22. In the memo, she described how the company is building new tools to develop top performers and address low performance quickly.
Now, workers who are informed that they are underperforming must act quickly. They can either agree to a Performance Improvement Plan (PIP), with tough performance objectives, or receive the payout and exit. Microsoft is referring to this new option as the “Global Voluntary Separation Agreement” (GVSA). If an employee chooses to remain and undergo the PIP, he or she will no longer be eligible for the payout. He or she has only five days to make the decision.
There are some additional policies. If a worker is terminated for poor performance or while in a PIP, they will not be considered for employment at the company for two years. Also, they will not be permitted to move to other positions at Microsoft.
Microsoft terminated approximately 2,000 poorly performing workers earlier this year. The firings occurred following performance evaluations, and the workers did not get severance pay.
Amy Coleman explained the objective of such changes is to make a transparent and equitable system company-wide. She also mentioned Microsoft aims to have a culture in which workers own their performance and have opportunities to develop. The process of reviewing performance will be in place year-round, and therefore, managers can address problems sooner.
Microsoft has already dismissed thousands of employees in the last two years. This new proposal appears to be the latest move by the company to control performance more tightly and provide employees with more options.
