Tech companies like Amazon and Meta are tightening their performance reviews. Here’s what that could signal, according to experts
Amazon and Meta are revamping how they evaluate employee performance, a move experts say could foreshadow another wave of firings or layoffs across Big Tech.
At Amazon, which announced 16,000 layoffs on Jan. 28 following 14,000 cuts in October, corporate employees are now being asked to formally submit three to five individual “accomplishments” as part of their performance reviews. While Amazon has asked similar questions in the past, this marks the first time the company has standardized the process across its entire corporate workforce, according to reporting by Business Insider.
Meta is taking a more explicit approach. Following layoffs affecting roughly 1,000 employees in January, the company is introducing a stack-ranking system that categorizes workers into four performance tiers: the top 20%, a middle 70%, a lower 7%, and the bottom 3%. Top performers—those deemed to have “truly exceptional impact”—can now receive bonuses of up to 300% of their base bonus.
“We’re evolving our performance program to simplify it and place greater emphasis on rewarding outstanding performance,” a Meta spokesperson said, emphasizing more frequent feedback and recognition.
Performance Reviews as a Cost-Cutting Tool
Neither approach is unusual in isolation. Asking employees to summarize accomplishments during review cycles is common, and stack ranking has long been used in large tech firms. As UC Berkeley Haas professor Saikat Chaudhuri notes, these systems are both “stick and carrot”—they discipline low performers while incentivizing top talent.
What’s different now is the context.
These changes are unfolding amid widespread layoffs across the tech sector and the broader economy. According to Challenger, Gray & Christmas, U.S. employers announced more than 108,000 job cuts last month—the highest January total since 2009. Roughly 40% of those cuts came from Amazon and UPS alone.
Peter Cappelli, a Wharton School professor and director of Wharton’s Center for Human Resources, says performance crackdowns are often a precursor to workforce reductions.
“It’s cheaper to fire people for poor performance than it is to lay them off,” Cappelli explains.
By tightening evaluation standards, companies can reduce headcount without triggering the costs and optics of mass layoffs.
Regaining Control After the Great Resignation
Executives may also believe managers have been too lenient in recent years, Cappelli adds. Tougher performance mandates—often paired with return-to-office requirements and increased monitoring—can signal an effort to reassert managerial control after the employee-friendly labor market of the Great Resignation.
Chaudhuri frames the shift as part of a broader “right-sizing” after pandemic-era overhiring. During the tech boom, companies hired aggressively just to keep pace. Now, the focus has shifted from growth to efficiency.
“Companies don’t want more employees anymore,” he says. “They want the highest performers.”
Requiring workers to document accomplishments may also reflect organizational disruption caused by layoffs. With layers of middle management removed, new supervisors may not fully understand what their reports do—forcing employees to make their value explicit.
There’s also a Musk-like influence at play. During aggressive cost-cutting efforts, Elon Musk-aligned initiatives have required workers to regularly justify their output, a practice some companies appear to be adopting.
Fear, Pressure, and Reputational Risk
The performance overhauls come as competitive pressure intensifies, particularly around artificial intelligence. Shareholders are demanding leaner operations, and companies are racing to allocate resources toward AI development.
“This is an era of ferment,” Chaudhuri says. “Every business has to figure out how to operate as leanly as possible during disruption.”
The human impact could be significant. Heightened scrutiny and fear of poor evaluations may push employees to work longer hours—or to quit preemptively to avoid being pushed out. While that may reduce severance costs in the short term, it risks long-term damage to the employer's reputation.
When the labor market eventually shifts back in workers’ favor, Chaudhuri warns, companies may have to offer outsized incentives to offset the reputational fallout.
For now, the message many employees are hearing is unmistakable:
“I need to work longer hours. I need to prove my value. It’s that time again.”