Australian tech leaders Atlassian and Canva are putting the screws on thousands of their workers for slacking off as redundancies become a reality in ‘difficult’ economic times.
Both companies, which have for years spruiked staff perks and fun offices as crucial to their success, are now using five-tier staff performance rankings similar to industry leaders Microsoft and Amazon.
The tough systems are more likely than previous metrics to rate their workers as under-achieving in their jobs.
The changing cultures at both companies have come as key financial health indicators tumble, prompting calls to operate more efficiently.
Canva was valued at $US40billion in 2021 but that has been revised down by investors by as much as 67 per cent.
The changing cultures at Atlassian and Canva have come as key financial health indicators tumble, prompting calls to operate more efficiently in order to survive difficult economic conditions. Pictured, Canva CEO Melanie Perkins
A new performance review ratings system at Atlassian is expected to increase the number of the company’s staff who will be told they must improve. Pictured, Atlassian co-founder Mike Cannon-Brookes at right
Atlassian made 500 staff redundant earlier this year, just months after a much-publicised hiring spree. Pictured, Atlassian co-founder Scott Farquhar
Software company Atlassian’s earnings before interest, taxes, depreciation and amortisation (known as EBITDA) was minus $77.74 million in 2022, a 154 per cent decrease on 2021.
The company announced last week that it had cut 480 lower management positions, directing those employees to work on the ‘front lines’ of the business in coding jobs.
Atlassian’s employee assessment categories for 2023 are unrecognisable from last year’s, which said 95 per cent of all staff had either a ‘great’ or an ‘exceptional year’, rewarding them with bonuses and company shares.
Only five per cent of staff were told they’d had an ‘off year’.
But when Atlassian managers assess staff for their work in the 2022-23 year, the number who will be told they must improve will double on the previous year, the AFR reported.
Six per cent of staff will be told they ‘met most expectations’ while four per cent will get an ominous ‘did not meet expectations’.
Forty-five per cent will be told they ‘met expectations’, while 30 per cent will hear that they ‘exceeded expectations’.
About 15 per cent of staff will be told they ‘greatly exceeded expectations’.
Staff in the top two categories are understood to be in line for increases in financial rewards.
Last week, Atlassian announced it had cut 480 lower management positions. Pictured, Mike Cannon-Brookes and his wife Annie during 2016 Fashion Week Australia
People in the middle should get their full contracted bonus, and people on the lowest grade risk receiving no bonus or share grant for that year at all.
‘[Atlassian] haven’t done anything like this before,’ said one employee who asked to remain nameless.
‘It’s been a very chill company, vibing out, playing as a team, [and] now it’s becoming similar to Facebook, Google, Microsoft.’
Another staff member said the changes might stop some highly-paid employees from slacking off work early.
‘The fact that people were doing two hours of work and socialising all day was a zero interest rate phenomenon,’ he said.
Avani Prabhakar, Atlassian’s head of HR, told Daily Mail Australia the company was constantly looking at new ways to improve its performance review processes as it grows.
‘Moving to a more differentiated system not only means better rewarding a larger group of people for exceptional performance, but it further clarifies the high bar we hold at Atlassian for the important work we do for our customers.’
In March this year, Atlassian made 500 people redundant, or five per cent of its workforce.
At Canva, employees now get one of five ratings for their work in the previous year: Missing, Approaching, Thriving, Excelling or Redefining.
Those with lower ratings are put on internal coaching programs, tracked by management and fired if they don’t raise their performance levels within a few months.
The categories were developed with the company’s performance review process in 2021.
In 2021, 95 per cent of Atlassian staff were deemed to have had a ‘great’ or an ‘exceptional’ year but employees are now more likely to be rated as under-achievers. Pictured, Scott and Kim Farquhar at the GQ Men Of The Year Awards in 2017
Canva staff have noticed more of their colleagues being ‘performance-managed out’ of the company. Pictured Canva co-founders Cliff Obrecht and Melanie Perkins
In 2018, Canva was rated No.1 in an annual ranking of Australia’s best places to work. Its Sydney headquarters had not just a gym, but also a library, a rooftop terrace with incredible views and a piano room.
But in 2023, Canva employees speaking on the condition of anonymity reported an increase in the number of staff being ‘performance-managed out’.
It is also understood that there has been more growth in the number of employees earning the top performance review ratings than drifting into the lower tiers.
Overall, Canva continues to expand into the United States and has increased its staff headcount from 2,700 in 2022 to 3,700 in 2023.
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Read more at DailyMail.co.uk