Tech jobs getting tougher? Microsoft not just firing over 6000, it is also changing its rehiring policy

India Today

14-05-2025

Microsoft has announced a massive 3 percent cut in headcount, which amounts to a total of 6,000 employees in line to get the dreaded pink slip over the coming days, even as Redmond moves to increase operational efficiency by realigning resources to a workforce involved in core engineering rather than people who manage them. This is now the second-biggest round of firings in the history of the company responsible for consumer-facing products like Windows and enterprise solutions like Azure. But these layoffs are not the only internal changes the company is apparently making. Microsoft is reportedly going through several sweeping changes, including – and not limited to – policy vis--vis rehiring.advertisementSo, while on the one hand, Microsoft is laying off a huge chunk of its global workforce, it is also making it difficult for some of these people to come back. According to reports, the company has recently enforced a two-year rehire ban for employees who are fired due to performance-related issues. Microsoft is calling it 'good attrition', per Business Insider, which claims to have seen internal – and presumably secret – documents that speak of these purported changes. In layman terms, what this means is that Microsoft wants these people to leave and is happy when they do. The strategy appears to echo the situation at rival company Amazon, which has its own 'unregretted attrition' metric as a firm and solid – but controversial – move to crackdown on underperformers. So, the company putting in place a system to not take these people back within two years' time seems reasonable, some might say. The only caveat is that, given Microsoft's scope and scale, other companies might also start to follow.advertisementMicrosoft is reportedly giving these so-called underperforming employees two options at the time of writing. They can voluntarily choose to be put on PIP (short for performance improvement plan), in which case they'll be given a timeline with clear expectations for improvement. Otherwise, they can quit by accepting a 'Global Voluntary Separation Agreement.' They will be eligible for 16 weeks of severance pay, per the report, while those who opt for PIP will not get it, plus they can't also avail any internal job transfers within Microsoft.
Things are clearly moving fast, much in the same way as AI, which, for better or for worse, is the primary reason why a lot of these changes are happening. There is enough evidence that AI advancements will need time to become profitable. Right now, it seems all about making investments. Some are good, some might have risks and so, companies like Microsoft are switching gears to focus on hires that they think would bring them the most return. They are working to reduce what is called the 'PM ratio', which is the proportion of managers to engineers across teams.According to an official statement from Microsoft, these 'organisational changes [are] necessary to best position the company for success in a dynamic marketplace.'