- Amazon employees exhibiting serious performance problems have, for the last 18 months, been offered three options: accept a performance improvement plan, take severance pay and resign or plead their case to a jury of their peers, according to a Bloomberg Businessweek report.
- The third choice, part of the "Pivot" program, gives both an employee and their manager the chance to present their arguments to co-workers via video conference. It's aimed at reducing turnover and Amazon says it's happy with the results, but it's causing some resentment among employees, an employment lawyer told Bloomberg. He called it a "kangaroo court" that favors the employer, as employees tend to win only 30% of the time.
- Others noted that, regardless of who wins, it can be difficult for the manager and employee to continue working together.
Employers have many reasons to favor performance management over termination, not the least of which is cost. It can cost employers 33% of a worker's annual salary to hire a replacement if that worker leaves, according to one recent report. This means the replacement cost is $15,000 per person for employees earning a median salary of $45,000 a year.
And with the tight labor market, it may be more important than ever to focus on retention; long time-to-hire and time-to-fill numbers come with their own costs, and high turnover hurts the engagement levels of those left behind.
To address that need, employers have been laser-focused on creating and implementing their chosen culture, complete with branding, change-management plans measurable metrics.
Correction: A previous version of the story incorrectly defined the Pivot program.