Why not just have a configurable threshold (say, 2 years) where if the promoted person is determined incompetent in their new role, they are bumped back down to their previous role (keeping their same pay) where they are more efficient/competent.
1. Promote from principal engineer to technical manager
2. 2 years later -> this person sucks at management but they were a great engineer
3. "Promote" from technical manager -> principal engineer level 2