Considering Alternative Compensation Structures

1. Considering Alternative Compensation Structures The Chalkboard Project Mark Fermanich, APA Consulting Salem, OR November 21, 2013

2. Today’s Discussion • Traditional and alternative salary schedules • Why adopt and alternative salary structure? • Alternative compensation concepts and examples • Team exercises • Considerations for moving forward

3. Teacher Compensation: Traditional vs Alternative • Traditional compensation based on standard teachers’ single salary schedule • Base pay starting salary established by market • Base pay growth determined by years of experience, attainment of additional credits/degrees • Salary growth is standardized, increasing slowly over years of service with little or no relationship to performance

4. Teacher Compensation: Traditional vs Alternative • Alternative Compensation Models • Base pay starting salary established by market • Base pay progression determined by performance, career ladder steps, acquisition of knowledge and skills • May include other performance or market driven incentives • Rate of salary growth variable based on individual accomplishment

5. Why consider an alternative salary structure? • Single largest investment is in teacher (educator) compensation – 60% to 70% of total budget • Successfully reaching high performance goals requires districts to make effective use of these resources • Aligns investment in compensation with priorities & goals of district and/or school • Sends clear message of what priorities and expectations are

6. Why consider a performance-based salary structure? Reinforces and supports goals of a HCMS: • Recruitment and retention of high-quality teachers • Recognition and rewards for outstanding teaching performance • Structured activities to continually improve teaching and learning • Leadership opportunities and advancement throughout a teacher’s career

7. Team Exercise 1 • What goals do you want your compensation system to support? • How well does your current system support these goals? • Can you give examples positive or negative?

9. Approaches to Alternative Compensation SystemsModest Makeover • Retain traditional single salary schedule but supplement base pay with variable pay and/or stipends • Expanded roles • Hard-to-staff schools and/or subjects • National Board certification • Performance awards – individual and/or group

10. Approaches to Alternative Compensation SystemsModerate Makeover • Revise single salary schedule by reducing the number of steps and lanes (savings may be used to pay for incentives) • Make steps contingent on performance • Supplement base pay with variable pay and/or stipends • Expanded roles • Hard-to-staff schools and/or subjects • National Board certification • Performance awards – individual and/or group

11. Approaches to Alternative Compensation SystemsHybrid makeover • Based on career progressions, performance categories, knowledge and skills • Movement between career levels based on performance, with a limited number of seniority steps within each career level plus limited number of education lanes • Supplement base pay with variable pay and/or stipends • Expanded roles • Hard-to-staff schools and/or subjects • National Board certification • Performance awards – individual and/or group

12. Approaches to Alternative Compensation SystemsExtreme Makeover • Schedule based entirely on career progressions, performance categories, knowledge and skills • Supplement base pay with variable pay and/or stipends • Expanded roles • Hard-to-staff schools and/or subjects • National Board certification • Performance awards – individual and/or group

13. Examples • Guilford Co., NC, Mission Possible • Washington, D.C.: IMPACTPlus • Pittsburgh, PA • Harrison SD #2, CO • Denver, CO: ProComp • Baltimore, MD

14. Guilford Co, NC • Continues to use traditional salary schedule for determining base pay and base pay progression • Performance incentives: offers both individual and school-wide bonuses for teachers/schools achieving above average growth, range $750-$15,000 • Market incentives: • High value-added signing or transfer bonuses of $5,000 for teachers moving to Mission Possible schools • Hard-to-staff position incentive ranging from $2,500 to $5,000 depending on position • Leadership Reward for teachers assuming school leadership roles - $2,000 • 1% Salary Reward – paid to certified and classified staff in certain high-need, low-performing schools

15. Washington, DC • Available to all educators who are members of WTU • Based on performance on IMPACT teacher evaluation and support system • Combination of evaluation, student achievement • Retains traditional salary schedule for base pay and progression • Rewards high performance through bonuses and permanent base pay increases

16. Washington, DC • Educators who receive “Highly Effective” rating receive annual bonus depending on a) poverty and performance levels of school and b) if performance rating is based more than 50% on student achievement. For teachers:

17. Washington, DC • Educators who receive “Highly Effective” rating in two or more consecutive years may receive a permanent increase in base salary. For teachers:

18. Washington, DC • Impact plus differentiates potential bonuses and salary increases by: • Teachers • Coaches • “Others” – comprising most support personnel (librarians, counselors, social workers, speech therapists, etc.)

19. Pittsburgh’s 2010Teacher Salary Schedule

20. Pittsburgh Includes multiple Career Ladder provisions: $13,300 Clinical Resident Instructors who serve as mentors and coaches. $12,200 Turnaround Teachers who serve on special assignment to low performing classrooms. $11,300 ITL2s – Instructional Teacher Leader 2 who work as subject specialists. $9,300 Learning Environment Specialists who provide support for classroom management strategies.

21. Pittsburgh $9,300 Promise Readiness Corps, teachers who work as special support teachers for students in grades 9-12. Piloting a Voluntary Incentives Earnings at Work (VIEW) pay program that allows proven effective teachers to take on additional leadership roles and earn a $10,000-$14,000 pay differential.

22. Pittsburgh STAR School-Based Performance Plan Rewards schools that fall within the top 15% of district schools ranked by growth. Awards equal $6,000 for each full-time professional staff, with amounts prorated for those working in the school less than full-time, and $2,000 for paraprofessionals and clerical staff.

23. Harrison SD #2 • Is district of 10,000 students, 750 teachers, high poverty/ELL population • Includes teachers, special service providers and administrators under evaluation system, but administrators ineligible for compensation plan • Based on scores from district’s Effectiveness and Results Scale. Consists of 50% measures of teacher effectiveness/50% student achievement • Compensation plan initiated in 2010-11 school year

24. Harrison SD #2 • Teacher pay based on evaluation score • Evaluation consists of 50% practice and 50% student achievement measures. • Measure of practice consists of 7 performance areas • Multiple student achievement measures including growth and status, state assessments, district assessments and SGOs

25. Harrison School District 2 (Colorado) All teachers included under new schedule

26. Harrison SD #2 • Teachers may not skip levels as progress up scale • Teachers receive little or no pay in other forms, such as stipends for extra responsibilities. These are implicitly built into the salary schedule. • When implemented, 80% of teachers received base salary increase, 20% received no increase. • Teachers must improve performance to move up both within and across performance categories • If teachers fail to perform at level for 3 consecutive years may move backwards on schedule and receive pay cut.

27. Denver Public Schools • ProComp is available to all DCTA teachers • Teachers employed at time of implementation in 2005 had option of opting out and remaining on traditional salary schedule. • All teachers hired since 2006 automatically enrolled in ProComp. • DPS citizens approved a $25 million excess property tax levy to support plan.

28. Denver Public Schools • ProComp goals: • Reward and recognize teachers for meeting & exceeding expectations • Link compensation more closely to student outcomes • Enable district to attract and retain most qualified and effective teachers • ProComp basics: • Base pay is the base pay index - $37,927 in 2013-14 • Plus 4 pay components. Some are annually earned bonuses, others increase base pay

29. Denver Public Schools • ProComp’s 4 components: • Knowledge and Skills: compensates teachers for acquiring and demonstrating knowledge and skills by completing annual professional development units, or earning additional graduate degrees and national certificates. May be reimbursed up to $1,000 annually, $4,000 lifetime for tuition and repayment of student loans. • Professional Evaluation: recognizes teachers for their classroom skill by receiving salary increases every three years for satisfactory evaluations.

30. Denver Public Schools • Student Growth: rewards teachers for the academic growth of their students. They can earn compensation for meeting annual objectives, for exceeding CSAP growth goals and for working in a school judged distinguished based on academic gains and other factors. • Market Incentives: bonuses for assisting the district and schools in meeting specific needs such as hard to serve schools or hard to staff positions - assignments which historically have shortages of qualified applicants.

32. Baltimore Compensation based on 4 career pathways:

33. Baltimore Teachers advance intervals (steps) within pathways by earning a minimum of 12 Achievement Units (AUs). Interval worth about 3% AUs earned through: Annual Professional Evaluations Approved professional development Contributions to student achievement Contributions to colleagues Contributions to school and district AUs do not transfer when move pathways

34. Baltimore Teachers move across pathways by: Standard to Professional Advance through all intervals in Standard pathway (10 intervals) Apply to Joint Oversight Committee for accelerated movement by completing requirements in 3 domains Earn at least standard professional certification Complete district induction program – New Teacher Institute Complete 3 internal courses and a capstone project

35. Baltimore Teachers move across pathways by: Professional to Model Requires approval by the Professional Peer Review Committee (PPRC) based on portfolio submission on 4 criteria Student achievement Instructional practice Professional growth Leadership Alternative process/criteria of 10 years of service, proficient evaluation in 2 of last 3 years, review by PPRC

36. Baltimore Model Pathway teachers are expected to take on additional responsibilities such as: Mentoring new educators Coaching struggling educators Serving on the PPRC Developing and facilitating PD Opening classrooms or practice to colleagues Serving in a school leadership position Attending ongoing model educator training Developing curriculum and assessments Supervising student teachers, practicum students and interns Keeping documentation to support his or her model profile

37. Baltimore Teachers move across pathways by: Lead teachers Apply to PPRC in process similar to becoming a Model Teacher Must be approved by PPRC Placed in pool, top 5 by date of entry must be interviewed by principals Appointment reviewed every 5 years

38. Baltimore Salary ranges (12-13): Standard $47,475 - $53,433 (10 intervals) Professional $47,475 - $84,011 (15 intervals) Model $86,617 - $92,707 (5 intervals) Lead $94,310 - $100,806 (5 intervals) Teachers at top of interval scale may still earn longevity increases of 1%

39. Designing and Implementing a Performance-Based Compensation System • Capacity considerations • Establishing a representative planning group • Establish: • Timeline • Key tasks/decisions • Modeling and data for estimating costs • Project support • Pilot

40. Capacity Considerations • District must assess capacity and costs of new system: • Evaluations • Training in new system • Professional development and other teacher supports • Assessments • Data systems • Pay system • Administration

41. Key Decisions/Tasks • What are your goals for the system? • What will it cost? What can you afford? • How will educators move up/across the schedule? • What are the performance criteria? • Will differentiated roles be included? Which roles? Why? • How much are salary increases for moving up/across? • Will there be steps within levels? How much?

42. Key Decisions/Tasks • Who is included/excluded from system? Will you grandfather current educators? • How will you handle educators in non-tested grades and subjects? • How will you place new educators with experience on the new schedule? • What happens to educators who fail to maintain performance commensurate to their pay level? • How will you assess and address capacity issues • Will you pilot the new system? • Be sure to evaluate annually • Include process for ongoing review and adjustment

43. Summarizing Key Decisions/Policy Considerations Purpose for Schedule Change Labor market conditions Quality of the performance evaluation system Cost and ability to pay The Ideal Salary Schedule? Educator values about equity and pay differentiation Desired mix of permanent base building and variable performance pay Readiness for change/presence of supporting factors Source: Tony Milanwoski, Westat/TIF

44. Team Exercise 2 • What would a new compensation system look like that supports your district’s goals and priorities? Be as specific as you can. • How well positioned is your district to make the changes necessary to implement this new system? • What are your strengths? • What are some obstacles? • What are some necessary steps to prepare your district for such a change? • What are some next steps for you to take to move forward?

45. Takeaways • Adopting alternative compensation structures provides opportunities to better align your significant investment in educator compensation with district/school goals and priorities • Approaches vary depending on local context, cost, feasibility • A number of key policy issues and decisions must be addressed early on and collaboratively • Important to assess district/school capacity to plan and implement successfully