The Benefits and Pitfalls of Performance Management Pay

24 Apr

On the 27 March 2014, the National Union of Teachers (NUT) called on its members to take strike action against the government’s measures to increase pension contributions, raise the retirement age and institute performance pay.  (Performance management has been running for the last 14 years.) The response of the public was muted, to say the least.   Parents of pupils sent home because of absent teachers, like Queen Victoria, were not amused about having to take time off work to care of their wards.   Over the Easter holidays, 2014, the NUT and NASUWT have been sounding the war drums again and aim to strike again in June.

However, performance pay seems to be here to stay, albeit it has yet to be embedded.   According to right-leaning Policy Exchange, a think tank, performance-related pay would drive up standards.  Notwithstanding, it had a caveat stating that this would have little impact unless schools grasped the nettle of making “difficult decisions” and not give salary increments to those teachers that were deemed “satisfactory” in old English and required improvement in Ofsted’s new terminology.  

Policy Exchange claimed that performance pay would attract more graduates into schools, creating “a strong culture of professional development and incentivise those in the teaching profession to improve their performance in the classrooms”.

But Policy Exchange sounded a health warning against linking salary increases crudely to pupils’ test and exam scores.   It suggested, rather, that pay increases should be based on a number of measures and determined on performance over several years to lessen the impact of test/examination results “volatility”.   It added that pay should not be held down arbitrarily as it would result in demotivating the teachers at the school.  The think tank observed that a well-designed system should not drive “perverse incentives nor cause divisions among teachers”.

Jonathan Simons, Head of Education at Policy Exchange, argued that students should be allowed a say in setting the pay of teachers.   He had support from the Programme for International Student Assessment (PISA) which showed that almost two-thirds of the world’s 15-year-olds were asked to give written feedback on the performance of teachers.

“We want to treat teachers like professionals,” he said to Stephen Exley of The Times Educational Supplement (TES).  “…We want schools to have the flexibility to reward and retain their best teachers and to use them to improve outcomes for young people….We agree with the thoughtful teachers who support this in principle but are cautious about how this will be implemented.  To see the benefits, we need to have a carefully designed system that works properly and that is transparent and fair.

“If schools do not want to differentiate between their staff members, make difficult decisions and have potentially difficult conversations, then performance-related pay will have little effect,” he warned.

However, other experts thought differently.   The introduction of performance-related pay could make the recruitment of teachers resemble the “football transfer window”, with schools forced to outbid each other for top talent, they warned at the Westminster Education Forum in February 2014.

Tom Hadley, director of policy at the Recruitment and Employment Confederation, told the Forum that the abolition of automatic rises and national pay scales in England this year would lead to schools having to compete with one another for the better teachers.   “It’s having an impact on teacher retention,” he said. “We’re already seeing a real challenge with the shortages in certain [subjects]. In terms of the market, I think we will start to see things evolve…schools are giving more money to certain high-demand roles and less to others, almost like we’re seeing a football transfer window start to [emerge].”

Simons himself concedes that the scheme’s impact internationally is mixed.   Two Indian studies revealed that performance pay led to improved test scores of pupils and a reduction of teacher absenteeism.   There had also been positive outcomes in several US states, Kenya and Israel.  However, there had been limited improvements in pupil performance in Tennessee and New York.

Union leaders sounded cautionary warnings.  Kevin Courtney, Deputy General Secretary of the NUT, said: “Measuring teachers’ individual contributions is next to impossible. Teaching is based on teamwork and every teacher contributes in some way to a student’s development.   Decisions will be unfair, subjective or even discriminatory.  They will be based on headteachers’ personal likes and dislikes and schools’ funding positions and many other reasons not based on ‘performance’ at all.”

Mary Boustead, General Secretary of the Association of Teachers and Lecturers (ATL) agreed remarking that schools would struggle to afford pay rises “without cutting the pay or numbers of other teachers or support staff”.   She added: “It is a mystery how this will enable schools in deprived areas to attract the best teachers”.

The union leaders’ words appear to resonate with the findings of a survey that the TES and ATL carried out on 900 principals and headteachers, deputies and assistant headteachers. The majority of the school leaders (51%) expected fewer teachers in their schools to receive pay rises after the change.  Very few thought that performance pay would result in any significant change.   They were unsure about the impact.

Brian Lightman, General Secretary of the Association of School and College Leaders (ASCL), said that while his members did not have any problem with performance pay, tight budgets would make it possible for only a minority of schools to take advantage of the freedoms allowed by the new system.

George Parker, former President of the Washington Teachers’ Union, the first union leader across the pond to have approved the introduction of performance related pay in 2010, agreed.  While he thought that it made perfectly good sense for teachers who put in more effort and time into getting better pupil/student results to be rewarded, he insisted that additional funding should go hand-in-hand with performance management.  Schools should have the ability to pay their best teachers more, he observed.

Parker appears to have had his wishes granted because the pay reforms have resulted in the average teacher’s annual salary in Washington DC rising to $77,000 (£46,000).  Altogether, 11% of teachers working in the most challenging schools were eligible for the largest pay rises in 2012.

One independent school in England, meanwhile, is charging ahead of the rest of the pack.  According to Steve Fairclough, headteacher of Abbotsholme School in Derbyshire, teachers are paid according to their “value to the school”.   This permitted him to keep the best teachers in the classrooms, rather than become deputies or headteachers and not teach.  “Somebody teaching in a department could be more valuable to the school than a head of department,” he told the Westminster Education Forum.

One thing is clear for those schools in the state sector.   If performance related pay for teachers is to be given any chance to succeed it is crucial that those operating it must be au fait with what should be done and what to avoid at all costs.   Out in the vanguard are the headteachers and other school (management) leaders.   In the debate that is going on, governors appear to be conspicuous by their absence.   Yet, it must be governors who maintain a rigorous watching brief to secure consistency and fairness across the school.   To develop the skills, training is needed.  Governors and other school leaders must also operate with probity and integrity.

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