I guess at the heart, the problem with firing is the emotional and social stigma associated with it. Someone is under-performing, and you don't think that it c

I guess at the heart, the problem with firing is the emotional and social stigma associated with it. Someone is under-performing, and you don't think that it can be corrected. By firing them, they have to go home to their wife and kids and tell them the news, that _they_ were rejected, that _they_ failed (even if it's not true). Managers don't want to inflict this on people, but they're looking out for something greater than an individual employee, they're looking out for their team. The other trouble is that sometimes under performance isn't the employee's fault. They were a bad match for the team, but your interview wasn't a good filter for that. Or maybe family issues are making them unfocused. Or their job has morphed out of their control into something beyond their skill set. Point is, even if someone needs to be laid off, they don't deserve to be punished. What they are proposing is not no-firing, it's making firing expensive, and treating people respectfully during it. Some companies fire quickly. Others, really slowly - mostly because there's no process for it, and nobody wants to take initiative to get rid of someone. Both have problems. The former puts employees on edge, and can feel random (project slips a week and you're gone? That'd be like programming with a gun to your head). The latter will reduce the team's productivity, since teams seem to tend to converge to the lower bar. Were they to say "we'll keep you on payroll for N months, please find a new job. You can continue to say that you work here for those months" people would be able to leave with their ego more in tact.