Walmart shifts from tenure-only raises to performance-informed annual increases and bonuses

Posts on an online worker forum and internal manager notes prompted the shift employees are seeing: Walmart will replace the old model of raises based solely on years at the company with annual increases and bonus payouts that use a three-part formula combining tenure, individual performance ratings and attendance. The change is described as part of Walmart’s 2025–2026 compensation cycle and affects both store associates and salaried managers.

The mechanics matter: the new approach produces tiered percentage increases rather than the flat tenure step raises many associates expected. Payroll and people leaders say the three components are calculated together to determine eligibility and the size of an annual increase, while a separate bonus program pays out based on the same performance and attendance inputs. Attendance consequences are explicit in the design—poor attendance can reduce or eliminate an increase or a bonus even for long-tenured employees.

That shift reshuffles who benefits most. Associates who maintain high performance ratings and near-perfect attendance will typically see larger percentage raises and clearer access to bonuses, while employees who relied on tenure as the primary path to pay growth are likely to get smaller increases. Managers are being asked to document performance outcomes and attendance records more consistently during the annual review window that covers the 2025–2026 cycle.

Operationally, stores and clubs will need to change how they plan schedules and replacement coverage because attendance now directly affects pay outcomes. Frontline supervisors told colleagues on internal channels that they expect more variability in payroll forecasting, since raises will no longer be a predictable step tied solely to hire date. The program also creates more occasions for pay conversations during yearly reviews and bonus payouts.

What associates should watch for next: official eligibility criteria, the exact tier percentages for increases, and the timing of annual reviews and bonus distributions. Those specifics are being rolled out as part of the 2025–2026 compensation updates; associates and managers should review the company’s forthcoming guidance and their local HR contacts to understand how the three-part formula will apply to individual cases. The change signals a move toward performance-informed pay that will make attendance and documented performance central to year-to-year earnings.