Meta Platforms Inc., the parent company of Facebook, META -1.61% decline; An internal memo reveals that red down-pointing triangle plans to reduce some bonus payouts and increase the frequency with which it evaluates employee performance. These changes are part of a revamp of the social media company that also includes significant headcount reductions.
The social media company informed managers on Monday in a memo seen by The Wall Street Journal that employees who receive a rating of “met most expectations” in their 2023 year-end reviews will accept a tiny percentage of their incentive and limited shares award due in March 2024.
The memo states that the bonus multiplier for that grade has been reduced to 65 percent. A Journal-viewed internal document stated that it was 85 percent.
“We understand that while this is a significant change that might disappoint some people, it aligns with our continued focus on maintaining a high-performance culture,” the memo said.
Moreover, Meta said it was moving evaluations of staff execution back to two times every year. The move comes in the midst of a move by Meta to reduce expenses.
Meta Stages didn’t quickly answer demands for input. CEO Mark Zuckerberg proclaimed 2023 the “time of effectiveness.” in February.
Monday’s memo said, “These updates reflect changes we’re making based on what we learned about the process in 2022 and what we’re optimizing for in the year ahead.”
The company has announced multiple rounds of layoffs, reduced office space, reduced travel expenses, and closed numerous teams and projects since November. In November, the business also announced that it would lay off approximately 11,000 workers, or 13% of its workforce. Meta as of late said it would eliminate one more 10,000 positions throughout the next few months.
When employees are rated as low performers in two consecutive review periods, Meta typically fires them. The Journal reported that Meta’s most recent round of performance reviews gave subpar ratings to thousands of employees.
According to the Journal, Meta’s management anticipated that more employees would leave in the following weeks as a result of the reviews.
The company stated in the Monday memo that the introduction of the midyear review aimed to issue “a calibrated performance signal for fairness” and had nothing to do with the forthcoming restructuring. The memo says that the review process should start in June and end in July.
According to the memo, the company intends to discuss the changes in a meeting with all company managers on Tuesday and plans to broadly notify employees on Thursday.
Meta is one of the increasing numbers of tech companies attempting to reduce costs and employee ranks. Numerous companies, including Amazon.com Inc., Microsoft Corp., Salesforce Inc., and others, have announced reorganization measures, including layoffs.
A three-point grading system will be included in the midyear review, which will classify employees as performing below expectations, at or above expectations, or significantly above them.