At SkyWest you can be an FO as long as you want. There are a couple of FO's with about 10 years seniority. Heck, we even have a downgrade program, though it sets you up for a two year seat lock.
Trip,
I think the policy you are thinking about is if an FO cannot upgrade to captain (cuz the pilot sucks and blows at least a couple of chances during training) they are terminated. Very rare.