Sorry it is called Curve Grading.
Many ways to do it. But that example where the best student scored a 60%. Everyone would get +40%. That's a Standard Curve method.
Personally, they didn't curve a lot of grades when I was in high school. It was more a college thing. A hard test that pushes the limit of your knowledge without being unfair.
But yes a grade can change afterwards for whatever reason the teacher wants. They could just throw on 10% if they felt generous. Definitely apparent when it's like a writing assignment without clear right or whole answers like math.