New Approaches to Teacher Compensation: Research Results and Policy Applications

1. New Approaches to Teacher Compensation: Research Results and Policy Applications Herb Heneman & Tony Milanowski Consortium for Policy Research in Education Wisconsin Center for Education Research University of Wisconsin-Madison

2. CPRE Work on Teacher Compensation Innovations • 1991: Odden & Conley, “A New Teacher Compensation System to Promote Productivity” • 1995-97: Exploratory design meetings with National Board for Professional Teaching Standards, leading edge states & districts, national teacher organizations • 1997: Odden & Kelley, Paying Teachers for What They Know and Can Do (2nd ed. 2002, Corwin Press) • 1996-2005: Research on school-based performance awards & knowledge & skill-based pay; National Conference. • 2007: Odden & Wallace, How to Create World Class Teacher Compensation (Freeload Press) • www.wcer.wisc.edu/cpre

3. Waves of Teacher Compensation Innovation Since 1980 • “Merit Pay” • variable annual pay increases based on principal’s subjective evaluation of last year’s performance • Problems with evaluation, funding • Programs died out except in a few wealthy districts • Career ladders • Stipends or raises for taking on extra duties • Access restricted by some sort of selection process • 22 states at one time

4. Waves of Teacher Compensation Innovation Since 1980 • School-based performance awards • Bonuses provided to all teachers (and others) in a school when that school achieves pre-established performance goals • Sometimes $ given to school for improvements • Knowledge & skill-based pay • Bonus or pay increase for participating in specified professional development • Bonus or pay increase for certification by National Board for Professional Teaching Standards • Bonus or base pay increase for demonstrating competencies in the classroom

5. Next Wave of Teacher Compensation Innovations? • Incentives for teaching in high-need or hard to staff schools • Incentives for teaching in shortage areas • Differentiated pay for teacher leaders • Pay increases or bonuses for teachers with high classroom value-added

6. School-based Performance Awards • School level performance pay plan • District or State establishes school-wide goals for student achievement (level or growth) and other performance indicators such as graduation, advanced placement, and attendance rates • Goals are annual or multi-year and require performance maintenance or improvement (relative to a base, relative to a standards, or value added) • There are pre-determined bonus amounts and payout criteria • Bonuses paid to teachers and other staff, or into a school activity fund • Full bonus (typically $500-$1,500) is paid to teachers and administrators; smaller (often half) bonus paid to other school staff • Single salary schedule remains intact

7. Knowledge & Skill-based Pay • Base pay increase or bonus (typically $300 - $3,000) for competency demonstration • skill blocks – technology, student assessment, curriculum unit design, etc. • portfolio completion • dual certification • graduate degree in subject taught • Base pay increase or bonus for NBPTS certification ($1,000 - $15,000) • Base pay increase or bonus for classroom performance mastery (typically $1,000 - $3,000), as measured by standards-based teacher evaluation • May involve changes to single salary schedule • fewer steps • fewer or redefined lanes • performance-linked career ladder progression

8. Combined Plans – Denver ProComp Additional pay on top of salary index amount ($34,200) for: • Knowledge and skills (up to $4,762) • professional development units • graduate degree/national certificates and license • tuition reimbursement • Standards-based teacher evaluation (up to $1,366) • Market incentives (up to $1,025) for hard-to-staff subjects and schools • Student growth (up to $2,052) • student success in meeting two annuallearning objectives • state test score growth • distinguished school • Funded in part by a $25 million referendum on the plan, not time-limited and inflation adjusted over time • Single salary schedule is replaced

9. CPRE Research on School-based Performance Awards • Sites: Charlotte-Mecklenburg, Kentucky, Vaughn Charter School, Maryland • Timeframe: 1998-2002 • Methods: Interviews, surveys, analysis of motivation-achievement relationship

10. Theoretical Framework - Teacher Motivation and Performance Awards School Teacher Effort Achievement Teacher IntensityGoals/Targets Consequences Persistence Positive FocusEnablersNegative Competencies Expectancy Instrumentality

11. When do performance incentives motivate? • Teachers perceive that goal achievement leads to consequences they value (instrumentality) • Positive (rewards) • Avoiding negative consequences (sanctions) • The value of positive consequences must outweigh the negatives such as stress, less freedom, and working harder. • They understand and accept the goals • They perceive a strong link between their own efforts and achieving the goals (expectancy) • They believe they possess the competencies • They perceive the presence of performance enable

12. Motivating Outcomes • Goal Attainment (e.g., bonus, public recognition) • Learning (e.g., seeing student achievement improve, working cooperatively with other teachers) • Sanctions (loss of pride, state or district intervention) • Demotivating Outcomes • more pressure & job stress • putting in more hours • less freedom to teach things unrelated to goals CPRE Research Findings

13. Expectancy averages • CMS 62% • KY 53% • Instrumentality averages • CMS 73% • KY 54% CPRE Research Findings

14. Low to moderate motivational impact • Small bonus amounts • Limited attention to ‘enablers’ & competencies • Uncertainty about effort-goal link • Uncertainty about funding • Schools in which teachers had higher levels of expectancy were more likely to meet performance goals (one std. dev. increase in expectancy associated with .2-.3 std. dev. increasein goal attainment) CPRE Research Findings

15. Rewards helped focus performance by defining goals • Focus, but do not drive performance due to low to moderate motivational impact • May increase turnover in schools identified as low-performing CPRE Research Findings

16. CPRE Research Findings on Knowledge & Skill-Based Pay Bonus or base pay increase for demonstrating competencies in the classroom via performance evaluation • Knowledge & skills defined by standards-based teacher performance evaluation systems based largely or in part on Framework for Teaching • Primary Sites: • Cincinnati Public Schools • Vaughn Next Century Learning Center (LA charter school) • Washoe County (NV) School District • Secondary : Anoka & La Crescent, MN, Coventry, RI, Newport News, VA

17. Research Findings on Knowledge & Skill-Based Pay • Evaluation ratings predicted value added student achievement in reading and math • Teachers accepted the teaching standards used to evaluate performance, but had mixed reactions on the fairness and validity of evaluation ratings • Administrators accept the teaching standards, reported increased workload in implementing new system, & had difficulties providing sufficient feedback and coaching • Implementation glitches were frustrating to teachers and administrators

18. Research Findings on Knowledge & Skill-Based Pay • Impacts on teaching practice were primarily on planning, classroom management, and attention to state and district standards • There was a lack of a broader strategy in the districts to use the pay system to drive teacher and student performance improvement • There was a lack of alignment of human resource systems (recruitment, selection, induction, mentoring, professional development, compensation, performance management, instructional leadership) to the teaching standards • Teachers resisted linking the teaching evaluation results to pay

19. Research Findings on Knowledge & Skill-Based Pay Bonus or pay increase for certification by National Board for Professional Teaching Standards • Incentives increased applications for NBPTS certification • Students of National Board Certified Teachers (NBCT’s) had higher value-added achievement in reading and math than students of non NBCT’s in two studies; a third study showed fewer and smaller positive effects • NBCT’s are not used much differently than other teachers by most states & districts • Rewarding NBPTS certification can be expensive (teacher preparation time, cost of application, salary increases or bonuses for certification), raising questions of its cost-effectiveness.

20. Research Findings on Knowledge & Skill-Based Pay Bonus or pay increase for participating in specified professional development • Little research on these plans; District experience suggests: • Teachers find them acceptable • They increase participation in targeted professional development • Increased participation builds a cadre of teachers with needed skills

21. Guidelines for Policy & Practice • Guarantee Stable and Adequate Funding • One reason for teacher suspicion of new pay plans is tendency of states and districts to lose interest in bad budget times. • Funding need not be just external infusions of new dollars. Resource reallocation, teacher attrition and reduced back-loading of the single salary schedule (Odden & Wallace, 2007). • Provide Competitive Total Compensation • Build Strong Measurement Systems • Reliability • Fairness • Timeliness

22. Guidelines for Policy & Practice • Gauge Likely Teacher Reactions to Performance Pay Plans • Acceptable degree of pay differentiation among teachers • Motivation to improve performance • Fairness of procedures and outcomes • Acceptance of overall plan

23. Guidelines for Policy & Practice • Engage the Teachers' Association • Include Principals and Administrators • Build Capacity • Develop a Performance Improvement Strategy and Plan • Align Human Resource Systems to the Performance Improvement Strategy

24. Strategic HR Alignment Student Achievement Goals Performance Improvement Strategy (Programs, Plans) Performance Competencies (What Teachers & Administrators Need to Know & Be Able to Do) Human Resource Programs Recruitment - Selection - Induction - Mentoring Prof. Development - Compensation - Performance Management - Leaders

25. Guidelines for Policy & Practice: Implementing the Innovation • Identification of a designated "champion" and formal leader for the plan; • Continual engagement by top management with the plan; • Attention to details and "drill down" of plan requirements to all systems involved; • Constant communication with teachers and principals. • Conduct a Pilot of the Performance Pay Plan

26. Looking Forward • Pay increases or bonuses for teachers whose individual classrooms show high value-added • Incentives for teaching in high-need or hard to staff schools • Incentives for teaching in shortage areas • Differentiated pay for teacher leaders

27. Implications for Rewarding Teachers for Classroom Value-added • Motivational impacts: • Bonus sizes need to be valuable enough to balance increased job demands • Need to address teacher suspicions of achievement  reward link (instrumentality) • Many teachers don’t believe they can reach a higher standard of practice (expectancy) • Need to attend to performance enablers • Importance of smooth implementation & teacher fairness perceptions in maintaining acceptance • Need to address measurement reliability (e.g., small samples make classroom value-added estimates unstable)

28. Implications for Incentives for Working in High-Need Schools • Motivational impacts: • Incentives need to be valuable enough to balance perceived negative working conditions • Need to provide enablers that help educators succeed in challenging schools • Reliable definition of “high need” or “hard to staff” • Need to align HR systems • Publicize incentives as recruiting tool • Select high potential teachers • Professional development tailored to skill needs

29. Why do we know so little about teacher pay innovations? • Many didn’t get fully implemented, changed frequently, or disappeared quickly • No comparison groups, no randomization; before/after comparisons obscured by other simultaneous reforms • Policy makers have shown little interest in evaluation • Will TIF improve the situation?