Sneaky managers and companies are using performance improvement plans (PIPs) as a ticking time bomb to get employees out to cut costs and protect themselves legally.
The dreaded PIP often give employees 30 to 90 days to fix their performance, but the likelihood of surviving one is slim, especially as more corporations are using them to sneakily layoff workers.
NYU’s Anna Tavis, who worked as a human resources executive on Wall Street for more than a decade, told the Wall Street Journal that PIPs are an ‘oxymoron.’
‘It’s a cover-up. It’s window dressing,’ she told the outlet. ‘I spent 15 good years on Wall Street and other places… None of these performance improvement plans lead to improving performance.
‘It’s an excuse to walk you out of the door and say: “We gave you an opportunity. You didn’t perform, and off you go.”‘
PIPs have long been used as legal coverage for corporations to avoid wrongful termination lawsuits.
It lays out the shortcomings of the employee and usually gives a timeline of when the worker is expected to change their performance. Some require daily check-ins, while almost all threatened termination if not successfully completed.
But the usage of the near-impossible-to-get-off-of PIPs still divides managers.
The dreaded PIP often give employees 30 to 90 days to fix their performance, but the likelihood of surviving one is slim, especially as more corporations are using them to sneakily layoff workers. Meryl Streep is pictured as abusive boss Miranda Priestly in The Devil Wears Prada, alongside Anne Hathaway
NYU’s Anna Tavis, who worked as a human resources executive on Wall Street for more than a decade, said PIPs are an ‘oxymoron.’ She said: ‘It’s an excuse to walk you out of the door and say: “We gave you an opportunity. You didn’t perform, and off you go”‘
‘It’s just a legal thing to make it so that we warned you that you’re going to be fired,’ Former CEO of Yext, Howard Lerman, told The Journal. ‘I will always fire someone right away because it is better for us and it is absolutely better for them.’
Envoy Founder, Larry Gadea, agreed that PIPs are often due to management not setting expectations early on.
Gadea estimates only 10 to 25 percent survive performance reviews.
‘A lot of the time, they’re done,’ he told WSJ. ‘They’re burned out, they need a break. And now you’re asking them to work harder.’
Despite the divide among management about PIPs, most employees are against it and often say their unfairly used against them.
Patrick McGah, who used to work as a research scientist at Amazon’s PrimeAir, said he was unfairly placed on a ‘Focus’ plan – part of the company’s two-step plan – in 2021.
When he asked why he was being placed on the plan, he told WSJ his manager told him: ‘You’re not raising the bar.’
When ask how to do just that, he was reportedly told: ‘Well, you need to raise the bar.’
Most employees, like Pat McGah, are against it and often say their unfairly used against them. When he asked why he was being placed on the plan, his manager told him: ‘You’re not raising the bar.’ When ask how to do just that, he was reportedly told: ‘Well, you need to raise the bar’
‘There was stuff I had no idea was an issue: “Pat struggles to create structure in ambiguous situations.” What the hell does that even mean? It sounds like a fortune cookie,’ he complained to The Journal.
He eventually took a severance package and left for a Seattle-based nuclear energy company, the outlet said.
An Amazon spokesperson told The Journal that the ‘vast majority of our colleagues regularly meet or exceed expectations, but for the small number of employees who don’t, we provide coaching and opportunities to help them improve.’
‘Like most companies, we have a performance management process that helps our managers identify who on their teams are performing well, and who needs more support,’ the spokesperson said.
Former Capitol One employees have also accused the company of telling its managers to rate more employees ‘below strong,’ which would eventually leave to their two-step process that would end in a PIP.
A senior manager who was placed on a PIP over the summer told The Journal that managers were told to be tough on performance to lower headcount expenses and several above him told him not to expect to survive his review.
However, the company denied this practice, saying it’s ‘not about cost cutting.’
‘We continue to hire thousands of new employees every year,’ a spokesperson to WSJ.
Former CEO of Yext, Howard Lerman, said PIPs are just a legal tactic to protect the company. ‘I will always fire someone right away because it is better for us and it is absolutely better for them’
The over usage of the PIP has gotten employees devising their own plans to stay employed a little while longer while looking for work as they ride out their PIP.
A tactic that’s becoming increasingly popular is file for a leave of absence under federally-protected Family and Medical Leave Act, buying employees time to look for a new job while still on their current company’s roster.
During the absence, the PIP is on pause and gives employees time to find a job without a resume gap.
It also provides employees a little more protection from being fired once they return.
‘That trend is real,’ Blair Ciesil, the global leader for talent attraction at McKinsey & Co., told The Journal. ‘Every manager I talk to, that is something that they say that they really struggle with.’
