Truly Paying for Performance
Pay for performance. Merit pay. Incentive compensation. Linking teacher pay to classroom effectiveness is a central premise in both current federal school reform strategy and in the recent education investments of major national foundations. Given that education is such a labor-intensive process—more than 75 percent of the average district’s budget goes to compensation—the idea of tying those dollars more tightly to the core mission is appealing.
Current teacher-compensation systems make no attempt to incentivize quality. Most educators would concede what research bears out: that the years of experience and educational credentials rewarded by lock-step salary scales are poor proxies for teacher effectiveness. Yet most of the new compensation plans now being discussed skip over performance and proceed directly to outcomes. In doing so, they do no better than the status quo at promoting quality teaching. What is described as paying for teacher performance is really paying for student outcomes, which in practice means paying for standardized-test-score gains, a very limited, perhaps even counterproductive, focus for incentives.
Standardized tests are a narrow measure of the educational goals our society and school systems hold for students. The No Child Left Behind years have provided ample evidence that focusing on a small slice of easily testable subjects and skills introduces damaging distortions into the system and impoverishes our definition of a “good education.” The practice of paying teachers based on students’ test-score gains rests on a false sense of precision about what those outcomes measure and how they are related to what teachers do in the classroom. Although such plans are often justified with references to best practices in the corporate world, in fact few private-sector employees—with the exception of salespeople—are paid primarily based on an objective measure of outcomes. Instead, most compensation systems recognize that outcomes are multifaceted and their relationship to work processes complex. Powerful compensation systems therefore necessarily incorporate a good deal of expert professional...
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