Google Overhauls Salary Structure Amid Strategic Compensation Shift

Google has said that it will change its performance grading system to give higher bonuses and stock awards to top performers while possibly cutting lower-performing employees' pay.

The vice president of worldwide compensation and benefits at Google, John Casey, told staff members in an email headlined "Strengthening our performance culture" that more people will have the chance to receive the "Outstanding Impact" rating in yearly evaluations.

Casey stated, "High performance is more important than ever to achieve the goals we've set," adding that the alterations are being made to "further reward top contributors" inside the organisation.

Focusing on Top Performers

The modifications particularly influence Google's Googler Reviews and Development (GRAD) annual evaluation system. This system assigns a score to employee performance ranging from "not enough impact" to "transformative impact".

The majority of workers usually fit into the "Significant Impact" group. More staff will be eligible for the coveted "Outstanding Impact" grade under the new structure, which has a direct impact on pay. Additionally, managers who perform well in the "Significant Impact" area will be rewarded with larger discretionary funds.

Casey did concede that these adjustments would be "budget-neutral", which means that some workers will earn lower pay in order to pay for the raises for high achievers.

Someone’s Loss is Someone’s Gain

In the email, Casey informed the employees that the firm would like to make clear that, in order to finance this, the equity and bonus individual multipliers for Significant Impact and Moderate Impact ratings would be slightly reduced.

Notably, significant impact will continue to be a high rating; if it is attained, the employee will still receive more than his desired bonus. The adjustments were confirmed by Google spokesperson Courtenay Mencini, who said, "We're making these changes to further reward top performers and continue our momentum across the company."

 The pay adjustments are in line with a larger trend in the tech sector, where organisations such as Microsoft and Meta are raising performance standards. These changes will affect Google's 2026 pay planning and year-end reviews.

In his email to employees, Casey came to the conclusion that the aforementioned adjustments are budget-neutral and that the company is still investing in extensive and very competitive perks and compensation.

Google Fires Hundreds of Employees from its Android, Pixel, and Chrome Groups

According to a media report, Alphabet's Google has let go of hundreds of workers from its Platforms and Devices business. This division is in charge of important products like the Chrome browser, Pixel devices, and Android software.

The layoffs come after a voluntary departure programme that was made available to staff members in January.

The action is a component of a continuous reorganisation that started last year when Google combined its Chrome and Android teams under the Pixel and Devices group. This group is headed by Rick Osterloh, a company executive. The combined company employed around 20,000 people at the time of the merger.