Unlike others on this thread, I am more pessimistic about the message that you received. Had your new director wanted to make you feel secure in your role, you would have received acknowledgment of your value to the company and your strong performance over time.
The acquiescence of your director’s boss doesn’t strike me as a good sign either, absent an acknowledgment of of your value.
Regardless, I’d say that you deserve an explanation of what “unpromotable” means with respect to your assignments and compensation. You might want to start with HR, as it might help to have HR facilitate a conversation between you and your new director on this subject.
Forewarned is fore-armed. If possible, I suggest that you reach out to those who were labeled “unpromotable” and subsequently left the company. What was their experience after being deemed “unpromotable” and why did they decide to move on? If you can’t reach these people, perhaps consult those at your company who worked with them.
Finally, keep an eye on your company’s financial performance and organizational plans. If financial performance deteriorates or reorganization takes place, those tagged “unpromotable” could be designated for downsizing.
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