"In the workplace, there is no getting around the fact that "the basic purpose of merit pay is manipulative." Alfie Kohn, Punished by Rewards: The Trouble with Gold Stars, Incentive Plans, A's, Praise, and Other Bribes
Merit pay is one of those ideas in education that just won't die. When budgets get tight, policymakers and politicians both look at the money being spent on educator salaries and the idea of paying educators based on performance starts looking attractive. "If only we identify the best teachers and pay them more, all will be well," they think. Then, the task of trying to identify and operationalize what a "best teacher" looks like begins, and it immediately falls apart. There's never been any agreement on what characterizes a "good teacher," and there probably never will. The current reform and accountability craze would have us believe "test scores a good teacher makes," but those of us who've been in classrooms for sometime know that tests don't always tell us what a good student is much less a good teacher. The pursuit of trying to find a specific, clear definition of good teaching and a good teacher is impossible, because teaching and learning, for that matter, are way too complex to reduce to a simple operationalized definition.
As Kohn points out, the problem with merit pay is that it is manipulative. It is simply an attempt to control educators and elicit a behavior, and in most cases, the desired behavior is the production of higher test scores. The problem is, many of us educators know "getting higher test scores" is a superficial goal. Getting a high score on a North Carolina Final Exam or End of Grade Test means very little in the lives of our students. We can't say to our students, for example, "If you get a high grade on this reading End of Grade Test, you'll be successful in life." If we do say that, we're trivializing education. So the idea of manipulating teachers to get them to raise test scores by merit pay is doomed to fail for those of us who see education's purpose as more universal and global. Educating good bubble-sheet bubblers is quite different than educating solid citizens who can take their place in the world and perhaps change things for the better.
In the end, merit pay will always fail in education, because the enterprise in which we engage is much too complex to be subject to its manipulative effects. Merit pay has been tried and it failed every time. Unfortunately, those who still have the faith in manipulation by reward just can't seem to let go of an anachronistic view of human motivation.