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Amazon employees fear increased 'quiet firing' tactics and a 'brain drain'

markets.businessinsider.com 13-01-2024 12:50 6 Minutes reading
The company continues to conduct layoffs, over the past week in departments like streaming service Twitch, media service Prime Video, Audible, and Amazon Pay, according to internal communications viewed by BI. But "quiet firing" tactics help companies cut down on labor costs discreetly, without the noise associated with public layoff announcements that disturb employees and shareholders. And, in cases where a "quiet firing" tactic leads an employee to quit, the company may cut the expense without paying severance. Justin Garrison, a senior Amazon Web Services employee until he quit this week, called the process "silent sacking." Garrison said he was told on September 1 that his team was being eliminated. He wasn't laid off, and didn't get severance. He was just told his team would no longer exist and encouraged to find an external job. Silent sacking, Garrison told BI, "is how Amazon is going to reduce operational costs without negatively affecting the stock price. Layoffs make negative news which lowers the stock. Ultimately it goes up when earnings show lower overhead, but it affects internal morale and trust which is destroying the company from the inside." Amazon's spokesperson generally disputed any performance management changes, and said it mandated that employees return to the office because the company believed it would "yield the best long-term results for our customers, business, and culture" One tactic Amazon uses to cull its workforce is its so-called "unregretted attrition" or URA target, the number of people it wants to lose through attrition, voluntarily or not. The targets at Amazon vary across teams and departments, but is typically around 6%, according to documents BI has previously viewed. In flush times, URA is intended to improve the quality of Amazon's workforce by shedding under performers, though its effectiveness and application has been a source of controversy. Employees who spoke to BI said the URA target has increased at least on some teams, though there hasn't been any formal guidance yet. One manager told BI they were told to target 10% of all employees for performance improvement plans in addition to the layoffs. Another manager said their URA target is now as high as 12%. Amazon's subsidiaries like Audible and Twitch, who previously did not have URA mandates, are also facing increased pressure to put a fixed number of employees on such plans, according to people familiar with the push. One of the people said they believe Amazon is using performance-improvement plans as a way of "laying off people without the noise of a WARN notice." A WARN notice is a mandatory state filing companies must remit when they make large workforce cuts, and typically draws a lot of attention. "These anonymous anecdotes about performance management are inaccurate," Amazon's spokesperson said, adding most employees regularly meet or exceed expectations, and those who don't receive coaching and opportunities to improve before any discussions about exiting the company. "While that may be a difficult experience for the employee involved, it's hardly unusual for a company of our size, and would be expected from any business that's focused on consistently delivering for its customers." Amazon has 1.5 million employees. Some employees believe Amazon's unusually strict return-to-office mandate is also part of the "quiet firing" plan. In early 2023, Amazon began pushing most staff to come into the office at least three days a week. Then in July, the company started enforcing a "return-to-hub" policy. Hubs are central locations assigned to each individual team, and employees have to work out of those hubs instead of any office nearest to their current city. Those who choose not to comply are expected to find another team, or take what the company calls a "voluntary resignation" meaning the company will interpret the lack of compliance as if the employee quit the job. In recent months, Amazon took a step further by blocking promotions of employees who fail to meet the office attendance policy. Amazon is also now asking some managers to give lower performance ratings to those who are non-compliant with the RTO policy, according to people familiar with the matter. "Promotions are one of the many ways we support employees' growth and development, and there are a variety of factors we consider when determining an employee's readiness for the next level," the spokesperson said. "Like any company, we expect employees who are being considered for promotion to be in compliance with company guidelines and policies." Some Amazon employees recently took to Slack to announce their resignations specifically over the return-to-hub policy. "Tomorrow is my last day at Amazon," one of the employees wrote on a Slack message board called "remote-advocacy" last month. "The lack of basic human respect leadership has shown with the layoffs and forced RTO is completely unacceptable." Amazon's spokesperson said, "In February, we shared with employees that we'd be asking them to start coming into the office three or more days per week beginning in May because we believe it would yield the best long-term results for our customers, business, and culture. And it has." "With the vast majority of employees in the office more frequently, there's more energy, connection, and collaboration, and we're hearing that from employees and the businesses that surround our offices," the Amazon spokesperson added. The brain drain, meaning the loss of institutional knowledge, is the bigger concern, employees say. "They've lost so much institutional knowledge this past year there are brand new teams running critical services. I don't see how that won't have a negative impact," Garrison, the recent ex-AWS engineer, told BI. "There's a lot of process inertia that'll keep things running fine for a while. But when things break they're going to be a lot harder to put back together when the people who built them are no longer around." The loss of senior engineers who can lead in crisis situations is a growing risk, these people said. One person who works on Amazon's cloud infrastructure service told BI that they lost a third of their team following the layoffs, leaving them with more junior engineers in charge. If a large-scale outage happens, for example, those engineers will have to learn how to be in crisis mode on the job. Another AWS employee told BI they feel like they are "doing the job of three people." A similar question was also raised during a recent internal all-hands meeting, BI previously reported. "They don't have anyone to teach them so that's a little scary," one of the people said. "We remain well-resourced to continue delivering industry-leading innovations on behalf of customers across Amazon's various businesses. Any suggestion to the contrary is untrue," the Amazon spokesperson said. "There's no question we keep our performance bar high, and that's one of the reasons why Amazon is one of the most sought-after places to work in the world." Are you an Amazon employee or do you have insight to share?

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