Since fall 2021, the author has practiced a method of ungrading, labor-based contract grading, in all courses in the small German program at the University of Nebraska at Omaha. The author has anecdotally observed less anxiety, fewer incidents of cheating, more cooperation among students, stronger rapport between students and instructors, growth of minors and majors, and more excitement and energy in the program. To familiarize the German language acquisition community with the literature, the article presents a comprehensive review of the harms of normative grading practices and the theories backing and questioning ungrading methods as alternatives. The mixed-methods study used pre- and post-semester surveys to measure the students' perceptions of the benefits and disadvantages of the unconventional grading system and found that while there are opportunities to improve, almost all students approve of the method and see value in its emphasis on learning and de-emphasis on metrics for assessing language growth.