Amazon has a goal to get rid of a certain percentage of employees each year, often 6% — and a leaked internal memo appears to shed light on a company strategy for forcing employees out.
The memo directs Amazon Web Services managers to place twice as many employees as it wants to get rid of into a performance coaching program called Focus, the first step on a path that potentially ends in an exit from the company. Amazon employees first enroll in Focus, a coaching program for underperformers. If performance doesn’t improve, they can end up in Pivot, another program in which employees can choose between exiting the company with a severance or starting a performance improvement plan.
Employees who receive the lowest rating in annual performance reviews were automatically enrolled in Focus, according to the memo and two Amazon managers in different departments who have similar instructions. The memo states the employees were automatically enrolled on April 1, and once they’re in the program, a VP must approve their removal.
The memo also indicates that if these AWS teams failed to meet their targets for employee departures in 2020, they have to make up the difference in 2021.
“This story is based on a false or incorrect source and the details included here do not reflect company policy,” an Amazon spokesperson said, but did not detail any inaccuracies and has yet to respond to a request about whether these measures are practiced anywhere in the company. The company has previously denied people who received the lowest performance review rating were automatically enrolled in Focus, saying there is no direct tie between a performance rating and being placed in coaching programs such as Focus.
Amazon employees receive a performance grade during a review process — top tier (TT), highly valued (HV), and least effective (LE). As Insider previously reported, managers across the company are expected to rank 20% of employees at the top level, 75% in the middle tier (which has three levels), and 5% in the bottom tier.
Amazon has a metric called “unregretted attrition rate,” or “URA,” which represents the percentage of employees it would like to see go in a given year, voluntarily or otherwise. Even the most senior executives at Amazon, including incoming CEO Andy Jassy, closely track URA, according to internal documents obtained by Insider.
The goal appears to be 6%, at least for most teams, according to leaked documents and multiple sources inside the company. If the AWS teams fell short of the URA goal in 2020, the memo reveals they have to make up the difference in 2021. This would mean, if a particular team only got rid of 3% of employees, the goal for 2021 would be to get rid of 9%.
Insider has spoken to more than a dozen employees who say Amazon employee reviews resemble stack ranking, a controversial…
Go to the news source: Leaked Amazon Memo Shows How It Forces Out Employees to Hit Targets