In my country(philippines) this is how some public schools (weird and bizarre)separate classes:

In my school, they separate students in the same year into 35 sections and its based on your grades or the total average of your grades but it can also be up to how early you enrolled. The earlier you enroll higher the chance you'll be on a higher section and if you're late even if you have a 95% average you'll still be put in a lower section.

If you're on a lower section(not too low tho) and you got a high grade, you'll be shifted into a higher section. Last year when i was a grade 8(section 2) i had a classmate from section 17(she was the top 1 on first quarter by the way).
Higher sections don't get pampered or specially treated or anything its just idk thats the way it is. I'm currently in section 1 and our room and facility there's not a single electric fan in our room geez!!

I think not all students with 90 above average goes into a high section because if you enrolled late and got into lets say section 20 - 35 i think you cant go into higher section in just one year and also because one class is limited into 50 people (ikr too manyyy)

And the only thing that is just unfair about this whole separating based by grade thing is only the top students from section 1 - 3 gets recognition and medals(not really a fan of going up to stage just because i had straight a's but i guess if i was in lower sec it would feel unfair)

So im curious about how other countries do it? how about in america? do they do this?