Google has now made changes to its Googler Reviews and Development (GRAD) system, effective for 2025 end-of-year reviews, and 2026 compensation planning, according to a report by The Times of India.
Announced today, Wednesday, April 30, 2025, by John Casey, Vice-President of Global Compensation and Benefits, in an email titled “Strengthening Our Performance Culture,” the revised system is designed to reward high performers more generously.
The GRAD scale ranges from “Not Enough Impact” to “Transformative Impact,” with most employees typically rated as “Significant Impact.”
Under the new structure, managers can assign the “Outstanding Impact” rating to a larger number of employees, directly increasing their bonuses and equity awards.
High performance to be incentivised
To incentivise high performance, Google is increasing managers’ discretionary budgets to allocate larger rewards within the “Significant Impact” category.
Casey emphasised that “high performance is more important than ever to achieve the goals we’ve set,” aligning the changes with Google’s focus on rewarding top contributors across all teams.
Companies like Microsoft and Meta are also intensifying performance-based compensation policies to drive productivity.
Budget-neutral approach
The compensation adjustments are “budget-neutral,” meaning funds for higher bonuses, and equity awards for top performers will come from reductions in rewards for employees rated “Significant Impact” or “Moderate Impact.”
Casey clarified that “Significant Impact” remains a strong rating, still yielding above-target bonuses, but multipliers for these categories will be slightly reduced.
This approach ensures Google maintains competitive pay within the top 5-10% of market rates while reallocating resources to reward exceptional performers.
