Why Merit Pay Is Still a Bad Idea & Waste of Time

The Education Commission of the States (ECS), an organization whose stated mission is "to help states develop effective policy and practice for public education by providing data, research, analysis, and leadership" has released  a report entitled "More on Pay-for-Performance." In that report it describes Pay-for-Performance models, and it reviews the current research regarding pay-for-performance policies in schools. The studies they review are the following:

Nashville Tennessee's Project on Incentives in Teaching (POINT): In this study, it was found that bonus pay alone does not result in higher student performance.

Study of Six Teacher Incentive Fund Sites (Louisiana, Arizona, Pennsylvania, North Carolina, South Carolina, and Texas): This study boasted a laundry list of positives: 1) Greater academic growth, 2) Increases in teacher retention rates, 3) Increases in schools meeting AYP goals, 4) Increases in high school graduation rates, 5) Significant increases in math and reading proficiency, 6) Increases in teacher collaboration. According to the ECS report though, this wasn't a "study" at all because an experimental design was not used in the research so no one can really say these positives were attributable to the pay incentives.

What's more of interest in the ECS report are its suggesting policy implications.

• "The theory of action for pay-for-performance may be flawed." The report draws the same conclusion that many of us educators in the field have been screaming loudly: "Incentives alone may not be sufficient to prompt improvement in teacher and student performance and to attract high-quality teachers to hard-to-staff schools and subject areas." There's no doubt that teachers want more pay. Who doesn't? But teaching and learning is such a complex process, achievement can't be reduced to a single test score. Paying incentives for test scores is morally wrong, and most teachers know that scores are the result of much more than the teaching and instruction they provide. As far as incentives for teachers to teach in hard-to-staff schools? What about dealing the with conditions at those schools that make them hard-to-staff? There's a reason teachers don't want to teach in those schools, and it certainly isn't necessarily just pay. The whole idea that you can use pay-for-performance schemes in education is flawed and will only turn our schools into places where test scores matter more than kids.
• "Performance pay incentives may have a low motivation value as compared to accountability systems." In other words, the authors of the ECS study review suggest that NCLB may have "diminished the power of pay incentives." NCLB's penalties and sanctions could have possibly affected the effects of incentive pay, but what is objectionable to many educators is having a entire system of incentive and punishments based on test scores. That kind of system elevates "the test" to the center of everything that happens in the classroom. Most teachers find no joy in teaching test preparation. Both performance pay and performance punishments suck the joy from teaching and learning.
• "Pay-for-performance reforms may take several years to realize their desired outcomes." This ECS statement frightens me. We know what pay-for-performance systems based on test scores do in the short term. The "test" is elevated to the center of the curriculum. Schools and classrooms turn into test-prep factories churning out students who have either acceptable or unacceptable scores. The whole idea of implementing that model long-term may destroy public education in the US. The truth is we don't know that the long-term implementation of performance pay will improve education either.
• "Securing sustainable funding for pay-for-performance remains a challenge in the current economic climate." With this statement, the ECS is right on target. Even if states were to implement pay-for-performance schemes, they have difficulties funding the current pay schedules much less new pay schedules. What if they changed to a pay-for-performance scheme, and in the third year of that scheme, two-thirds of the teachers in a state meet the pay-for-performance standards specified by the pay scale? But the state only budgeted enough money for a third meeting those standards. State funding streams do not increase based on the performance of schools and teachers. It is relatively fixed.  The state in this case has two options: a) find more revenue, b) freeze the incentives pay due to lack of revenue. States rarely are willing to increase revenues because that usually means more taxes. They usually resort to the second option. They freeze pay. I can only imagine the effect of telling two-thirds of teachers in the state who were expecting a bonus, now suddenly finding out the money's not coming. But wait a minute! That's happened in North Carolina for the last four years. The state did away with testing bonuses when the economy went awry. Teachers were to get $1,500 or $750 bonuses based on test scores. Instead, they got nothing. Ultimately, what ECS is suggesting here is that pay-for-performance schemes for states may not be sustainable in both short term and long term.

Pay-for-performance schemes in education are not new, despite politicians and billionaire ed-reformers attaching the word "reform" to them. They have been used before. The reason they weren't continued is simple. They didn't work. Never mind that states and districts found out they couldn't afford to pay their promised bonuses. Pay-for-performance schemes ultimately are attempts to buy our way to a better school system. The problem is that price is too high and it is too-short-sighted.