Salary structure of Google employees to be revised: What does this mean?

An email from Google Vice President John Casey indicated that they would have a chance to take home a better incentive based on their rating. “High performance is more important than ever to achieve the goals we have set,” the email read.

Google to revise its salary structure

Image Credit: Meta AI

In a bid to reward the company’s top contributors, Google has announced changes to the employees’ salary structure. An email from Google Vice President John Casey indicated that they would have a chance to take home a better incentive based on their rating during annual reviews. “High performance is more important than ever to achieve the goals we have set,” the email read. The changes would be enforced during the compensation disbursal in 2026. 

Google had cut down on their workforce recently to “operate more efficiently”. The company had also imposed a stricter policy on the work from home policy, asking its employees to adhere to it or lose their jobs.

Change in salary structure

The changes would be reflected in the Googler Reviews and Development (GRAD), which is a scale to measure the effectiveness of the company staff. Managers will now be allowed to give an employee the rating of “Outstanding impact”, which affects the compensation they receive. Earlier, an average employee would get a rating of “Significant impact” on a scale from “not enough impact” to “transformative impact.” The managers, responsible for assigning the “Outstanding impact” rating to an employee, would be provided an increased discretionary budget.

The mail, titled “Strengthening our performance culture”, also stressed that the changes would be budget-neutral. This means that those falling outside the “Significant Impact” category would receive a lesser bonus. “We want to be upfront that to fund this, we will be slightly reducing the bonus and equity individual multipliers for Significant Impact and Moderate Impact ratings,” the mail reads.

What does it mean for employees?

The mail gives emphasis that the Significant Impact rating will remain strong, and those achieving it would get more than the target bonus. However, there is scepticism whether low-performing employees would be affected.

According to a report, Google CEO Sundar Pichai was compensated 32 times more than the median employee. The report says Pichai received $10.7 million in 2024, of which $8.2 million was allocated as his personal security costs. Alphabet, Google’s parent company, had defended it saying it was in the best interest of the company and its stockholders.