This is true in most fields. In the officer ranks of the military, you're generally forced into retirement if you're passed up for promotion twice. In many government jobs, you're forced out if one of your former subordinates is promoted past you.
Only twice? I've never know the ins and outs of the military (and ex-PFC Wintergreen is the closest I'll probably ever know to people being demoted or missing promotion) however this seems incredibly harsh.
