The problem with the 2000s-era Microsoft method, as I understand it, was that the population sizes they used were too small. Stack ranking was done at the individual team level, and that did indeed lead to people sabotaging each other, because in a team of 10 only 2 people could get the highest pay raises and 1 person would be placed on a PIP (or whatever the ratios were).

But yes, all major companies still do something like this AFAIK, just with a larger population size now. Speaking from my experience at Amazon, the target was around 4%, but this was across entire departments. My department was 300 people. Is it possible that you can have a department of 300 people where you can't find 12 people who are below-average performers? Yes. Is it likely? No.

I don't know how many people the lead in the article managed. If it was a team of 15, he has a legitimate gripe. If it was a team of 200, not so much.