PERFORMANCE-BASED COMPENSATION

New approaches to teacher evaluation are combining accountability for performance with support for professional growth. In a growing number of school districts, new evaluation systems are also being coupled with performance-based pay—i.e., bonuses for effective teaching.

Both evaluation reform and performance-based compensation stem from the growing recognition that effective teaching is the key school variable in learning. Both of these reform efforts are increasingly connecting student growth to teacher performance, reflecting the urgency to ensure effective teaching. Many of the experiments in performance compensation—notably those funded by the federal Teacher Incentive Fund (TIF)—target high poverty, challenging schools.

Defining performance-based compensation

Bad experience in the 1980s with “merit pay” left a negative legacy. With little or no teacher input, bonuses in some places were based solely on a principal’s subjective evaluation. This approach was unfair, divisive, and ineffective. Moreover, the implication that a monetary reward would make teachers work harder stood as a broad insult to professionalism.

Today’s approaches differ in two ways: they tap into the professional aspirations that actually motivate teachers, and they are based on a broader conception of what leads to improved performance. Done well, performance-based compensation provides both accountability and support. More than just recognizing and rewarding excellence in teaching, it fosters that excellence, and does so by expanding the system’s overall capacity to support classrooms and improve teaching quality.

Not all compensation reform initiatives are done well. The biggest mistake made by states and districts is treating performance-based compensation as an isolated or piecemeal effort. This too-narrow approach results in a failure to address and strengthen the district support mechanisms necessary for school and teacher success—which subverts the intent of improving teaching and learning.

Implementing a successful performance-based compensation initiative

The goal of performance compensation initiatives is to help more teachers do a better job with more students. Successful initiatives show that this goal can, in fact, be achieved. Along the way, this reform can also be a lever for systemic reform. But to get these desired results, states and districts need to ensure that their efforts are formulated on the basis of the best practices we have to date, and they need to avoid known and recurring pitfalls.

In working with performance-based compensation for over a decade, CTAC has identified six cornerstones of success:

Performance-based compensation is a systemic reform. As noted above, teachers’ instructional success requires support from multiple district systems. By putting workforce paychecks on the line, this reform creates a powerful incentive to ensure both the quality of those systems and their alignment—with each other and with the real needs of classroom teachers.
Compensation reform must be done with teachers, not to teachers. It isn’t enough to issue a mandate and provide funding for bonus pay. Success requires that partners come to the table and be willing to redefine traditional relationships and create the new forms of collaboration necessary for developing and implementing the plans. Building trust and open communication is crucial.
Compensation reform must be organizationally sustainable. The key here is leadership—commitment at the top and throughout the ranks to increasing the levels and extent of teaching excellence. Sustainability requires the conscious building of individual and system capacity, through collaborative team efforts led by committed, skilled managers. Effective teaching is a function of effective management.
Performance-based compensation must be financially sustainable. From the start, districts need to be planning for how this reform can be sustained beyond the pilot period. Leaders need to bear key points in mind: If performance pay is tied to achievement, and achievement increases over time, its costs will increase. And its funding source is public dollars. Ultimately, sustainability requires the informed support of the broader community.
A broad base of support is required in the district and community. Success requires that all key constituencies understand the purpose and specifics of the reform and have opportunities to shape and influence its design and implementation. Ongoing, two-way communication is essential; in compensation reform, the forces of misinformation are more powerful than those of accurate information.
Performance-based compensation must go beyond politics and finances to benefit students. The effort can’t lose sight of the goal of student achievement growth. The challenge is to use multiple, valid measures of student learning to identify student progress and ascertain the contributions of classrooms, programs, and schools to that progress.

CTAC experience

CTAC has provided technical assistance and evaluation services to a number of school district initiatives in performance-based compensation over the past decade, including two of the nation’s most prominent examples of how this approach can result in positive impacts:

Pay for Performance in Denver. Co-sponsored by the Denver Public Schools (DPS) and the Denver Classroom Teachers Association, the four-year pilot (1999-2003) focused on developing a direct link between student achievement and teacher compensation. As its centerpiece, teachers in the 16 pilot schools—13 percent of DPS schools—developed two annual student learning objectives (SLOs), based on past student achievement and subject to the approval of the principal. Teachers received additional compensation if they met their objectives.

The results: CTAC found that students whose teachers crafted high quality SLOs showed more than a year's worth of gain on the Colorado Student Assessment Program and the Iowa Test of Basic Skills during each year of the study at all three school levels. Moreover, school and district focus on student achievement increased significantly. The successful pilot led to the district-wide compensation plan now known as ProComp, which was approved by the teacher union and financially supported by Denver voters, beginning in 2004.

TIF-LEAP in Charlotte-Mecklenburg (CMS). CMS is in the final year of a five-year implementation of the Leadership for Educators’ Advanced Performance (LEAP) initiative, supported by a federal TIF grant. As in Denver, CMS teachers use the CTAC-developed SLO process and are rewarded based on their students’ achieving their learning goals. In 2011 CMS won the prestigious Broad Prize for being the best urban school district in America—the urban district that has demonstrated the greatest overall performance and improvement in student achievement while reducing achievement gaps among poor and minority students. Exemplary practices cited included the district’s efforts to strengthen and energize personnel and leaders, partly through LEAP.

CTAC is providing technical assistance to other TIF grantees as well, including Prince William County Public Schools (VA), Henrico County Public Schools (VA) and the Northern Humboldt Union High School District (CA).

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