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Why the big song and dance?

Performance-related pay - opposition is vociferous, but what's all the fuss about?

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Performance-related pay - opposition is vociferous, but what's all the fuss about?

Just imagine, for a moment, a system in which teachers were properly rewarded for their efforts, their stresses, their desire to work harder for the betterment of their pupils.

Imagine that for every additional duty you took on and for all the continuing professional development you completed, you received extra pay. Not only that, but should you be given a glowing report by your head in your performance management meeting, you would actually get a bit more. And what if, as the icing on the cake, you were rewarded for a brilliant set of GCSE results with yet another bonus?

Imagine a scenario that banished the injustice of the average teacher taking home a salary of just pound;35,000 - half the amount earned by peers in the medical profession and less than a third of what a run-of-the-mill chief executive takes home each year.

Introducing a system - whisper it - of performance-related pay (PRP) in schools could see the best teachers' salaries "rocket off into the stratosphere", believes Russell Hobby, general secretary of the NAHT heads' union. He sparked debate earlier this year when he came out in favour of the idea.

So, too, has the government. "Once teaching becomes a high-status profession," the Department for Education has claimed, "more talented people will become teachers, lifting the status of the profession even higher."

And last weekend, Ofsted chief inspector Sir Michael Wilshaw waded in. "As a head, I would make it clear that if you teach well or try to teach well, if you work hard and go the extra mile, you are going to get paid well. You are going to be promoted. Somebody who is out the gate at three o'clock in the afternoon is not," he said.

For demoralised teachers earning far less than their peers in other professions, one might therefore reasonably assume that PRP would be a dream come true.

But this is not how most of their leaders see it. Indeed, the NAHT stands alone among the unions in signalling any semblance of support for the idea. A joint submission by the NUT, the ATL, Voice and Welsh union UCAC to the School Teachers' Review Body (STRB) - which is expected to report back to the government on the issue later this year - declared that they "fundamentally oppose the extension of performance-related pay for teachers and jointly agree that the DfE's move to extend performance- related pay would result in a demoralised workforce".

`Vested interests'

So what exactly is it that the critics of PRP are scared of? And is such a system genuinely capable of achieving education secretary Michael Gove's stated ambition "to reward good performance and attract the highest performing graduates and professionals into the profession"?

Of course, a form of PRP already exists in British schools - technically, at least. At the end of each year it is down to school leaders to decide whether their teachers deserve to advance up the pay scale.

But critics of the current system believe that it has been rendered ineffectual by the prevailing attitude among the educational establishment. The DfE's submission to the STRB cites 2009 research, which it claims shows that "virtually all full-time classroom teachers on the main pay scale . progressed to the next point".

Ministers are concerned that pay progression has become "primarily a reward for time served". Even in academies, which legally have the freedom to deviate from the national pay scales, the majority do not. In a joint survey conducted by TES and the National Governors' Association in June, 86 per cent of academy governors who responded reported that their school had no plans to diverge from the national pay structures.

A recent report on public sector pay reform by Policy Exchange, the right- leaning thinktank co-founded by Michael Gove, concluded that, "despite (schools') desire for financial autonomy, the evidence suggests they feel unwilling to vary pay because of the pressures of the national pay bargaining system and trade unions".

Ed Holmes, one of the report's authors and a senior research fellow in economics and social policy at the thinktank, believes that a "fear of the unknown" has obstructed experimentation.

"This is the way pay has been structured for a long time and there is perhaps a vested interest (among the unions) to keep it as it is," he says. "They think it is in their members' best interests. But where you are left with a lot of underperforming staff because they have been there a long time (and have already moved up the pay scale), that's a real problem."

Matthew Robb, senior principal at management consultancy the Parthenon Group, agrees that risk of conflict has scared off many schools. "It is painful to do. If you have worked alongside someone and you have got to tell them they are not good enough, that's not easy."

The unions' opposition, Robb believes, stems from their duty to protect their members - irrespective of their teaching quality. "If you are a good teacher, PRP is a good thing for you; you earn more money more quickly. If you are an old teacher who is a poor teacher, there is a significant amount of risk. Sometimes unions see it as a threat to their power and block it."

Across the pond

In the US, schools have been relatively open to the concept of PRP, with several hundred school districts introducing different schemes of, in local parlance, performance-based compensation. One of the most high- profile schemes, the Professional Compensation System for Teachers (ProComp), was introduced in Denver, Colorado, and has since spread to other districts, even being singled out for praise by President Barack Obama.

The system was introduced in 2006 with widespread support, not only from the public but also from business leaders, politicians and - crucially - teachers. ProComp was actually developed jointly by Denver Public Schools and the Denver Classroom Teachers Association.

Ensuring that teachers support the project is crucial, Robb believes. "If they don't buy into the evaluation system, it is dead in the water," he says.

Instead of being paid on the basis of their qualifications and the number of years in service, ProComp sets teachers' salaries using four criteria: knowledge and skills, market incentives, professional evaluations and pupil growth.

When it started, teachers were reassured that no one would earn less, while all would have the opportunity to earn more. Joining up to the scheme was optional; six years on, more than 80 per cent of the district's teachers have signed up.

If the slick promotional video on ProComp's website is anything to go by, teachers and heads are queuing up to sing its praises. As principal Charmaine Keeton explains: "I put in a lot of extra hours, and did a lot of extra things with my school and with the community and for my students, and I felt that, through ProComp, I was being paid for the job I was really doing."

Working as a middle school science teacher in Denver when ProComp was introduced, Margaret Bobb had some serious reservations. But, after 13 years in the profession, her salary had reached a plateau.

"So," she explains to TES, "I joined up in the first year, because it made sense financially. People were very distrustful of the district. But they told us it was all about professionalism and said we could make what people in other professions earned. It seemed like it was worth a shot, and it would be nice to be compensated for all our hard work."

And the initial impact was overwhelmingly positive, Bobb found. "It was going great for three years; everybody was pretty happy." The teachers in Bobb's school were incentivised by the prospect of building up their pay, and teachers who would previously have seen their salary capped at about $60,000 were delighted to see it creep up to $80,000 or higher.

A 2011 report by academics from the University of Colorado Denver noted a steady increase in pupils' achievement, particularly in maths and reading. The study also found that ProComp had attracted more high-performing new teachers to the district. But then the local schools authority decided that the system should change once more.

"They said it wasn't fair that somebody in their twenties was getting so much less compensation than much older teachers," Bobb explains. "They claimed there was real inequity."

So the structure of ProComp was overhauled. Now 50 per cent of the extra money up for grabs is based on pupils' exam results. Limits were also brought in. The proportion of the pay increase applicable to teachers who had demonstrated their continuing professional development ceased to be available to those who had been in the profession for 14 years or more. Most significantly, rather than building up their salary, teachers were instead handed a one-off bonus if their pupils performed well.

The new structure, Bobb says, has brought a negative attitude back into Denver's classrooms. "Now you have to jump through a whole bunch of hoops. I'm very bitter about it and disillusioned. When ProComp was introduced, it was all supposed to be about fairness, and that's not really played out."

It has also brought increased resentment between teachers in different schools. A $2,500 bonus is payable to all teachers in the 50 per cent of Denver schools that record the best "student growth" - that is, the most progress in pupils' exam performance.

"Denver is the district with the lowest socio-economic (status) in the state: lots of the kids are from working-class, poor families. But our district showed the highest growth in the entire state," Bobb says, proudly.

Despite outperforming many schools in more affluent, neighbouring districts, those teachers in Denver's lowest performing 50 per cent of schools - irrespective of their performance as an individual - missed out on the bonus.

"There is real resentment about it," Bobb says. "It's frustrating that we are doing everything great in the classroom but we have no individual control over our own salary-building."

No more money for the pot

While some US school districts have in recent years reluctantly acknowledged the need to spend more money to attract better teachers, the UK is in the fortunate position of having a relatively well-paid teaching workforce.

The flip side, though, is that there is no extra money to throw into the pot. Chancellor George Osborne has stressed to the STRB the importance of the "affordability of any proposals in light of the fiscal position - these should not lead to any increase in paybill in the short or long- term".

Martin Freedman, head of pay, conditions and pensions at the ATL, fears the nation's precarious financial position could skew the application of any PRP system, as there would only be a finite amount of money available to be distributed between teachers.

"Even if everybody performed excellently," Freedman explains, "you can't award bonuses to everybody. You end up in a situation where some people have more pay than others who have also done well. What we don't want to do is cause division and unhappiness."

A crude payment-by-results scheme, in which teachers would effectively receive a bonus if their pupils obtained good exam results, would also be disastrous for the profession, Freedman believes. "Students' outcomes are dependent on lots of things, not just teaching," he says. "Also, how do we calculate the impact of, say, a Year 9 teacher as opposed to the Year 11 teacher? How can we possibly quantify these things? If we made it relative to teachers' input, we would have a discussion, but it's not happened yet."

Another potential drawback is that teachers may be tempted to bend the rules for their own financial gain. In Denver, Bobb explains, individual teachers are eligible for a further salary increase of almost $300 if their class does well in its exams. But, as there are no standardised state tests for some groups and subjects, teachers are often left to set their own tests - and mark the papers themselves.

"There is inequity and potential cheating," Bobb says. "When it's a subjective answer and it's a grey area (in the mark scheme) will I give them three marks or four marks? And when I'm setting the baseline for the test, will I make it one mark or two marks? You're more likely to round down pre-test and round up post-test.

"And there may be teachers who teach to the test. What's to say students are not being taught verbatim what they should write?"

The other unintended consequence of introducing PRP, Freedman warns, would be a fundamental shift in the tone of performance management meetings, from focusing on improving the quality of teaching to a scenario in which the teacher feels compelled to make their case for deserving a pay rise.

"We need to have an open conversation about how you could do better. If you're going to lose money, why would you own up (to underperforming)?" he asks. "A key way of improving performance would be lost and it would create a different relationship with the line manager. We are not talking about investment bankers. They are teachers. They deal with things differently. You can't always compete with the grades from last year, if last year's set of kids was brilliant."

On this point, Hobby of the NAHT agrees: "The first goal of performance management should be to improve performance. It sounds banal, but so many systems fail to do this and become an empty ritual. It should be set up to help people develop - you should really want everyone to succeed in it. It is only when it is fulfilling that goal that you can then turn to differential rewards."

While giving tentative support to the introduction of some form of PRP, Hobby has his doubts about some of the systems in use in other countries. "There are studies that find impact and studies that don't," he says.

A 2006 report, for instance, claimed that in 502 sample schools across the US, PRP schemes led to an increase in test scores of between 1.3 and 2.1 points.

But while the DfE's submission to the STRB relies heavily on Andreas Schleicher's research on performance-related pay for the Organisation for Economic Cooperation and Development, the same author bluntly concluded earlier this year that there is "no relationship between average student performance in a country and the use of performance-based pay schemes".

Nonetheless, Hobby believes there is some room for improvement in the system. "We do see an argument for genuine performance-related progression as part of a general improvement in performance management in schools. Teachers, of course, will want to be sure that what is being measured is relevant, accurate and fair."

Focusing too crudely on pupils' results brings its own risks, Hobby warns. "I've always thought that performance management should look at what you do and how you do it, with some trade-offs between the two. You could have done all the right things but missed the target through events beyond your control; conversely, you could have hit your targets and screwed your colleagues over in the process.

"Number one rule: you can only hold people accountable for events within their control; anything else is just scapegoating."

And PRP should still be based on a national pay scale, Hobby insists. "Go up one rung if you're good, two if you're brilliant and none if you're neither."

The crucial point that Policy Exchange, the NAHT and the ATL are agreed on is that teachers must have faith in the PRP system in order for it to work. They must buy into it.

As long as they are on board, Parthenon's Robb is confident that, rather than being a private sector idea grafted awkwardly on to the state school system, it can actually be a perfect fit for hard-working teachers who care about their pupils.

"I would say it's ridiculous (not to have PRP)," he insists. "Ninety-nine per cent of teachers want to teach in order to make a difference to their students' lives. (PRP is) completely consistent with that belief. If you are doing a great job, it should be about getting you to stay there, work for longer, be well remunerated and feel valued.

"As a teacher, you are doing a job to improve children's lives. Would you rather be paid according to how old you are or how good you are?"

PRP around the world

Washington DC, US Teachers are evaluated on their instructional expertise, collaboration, professional compliance and the level of their pupils' achievement.

Memphis, Tennessee, US Pay is calculated by the value a teacher has added to pupil achievement, observations by a senior colleague, observations from other stakeholders including parents, and the teacher's specialist knowledge.

Singapore Bonuses are available for outstanding individual and team contributions. On top of their base pay, individual teachers are eligible for annual bonuses, ranging from half a month's to three months' salary, based on the judgement of panels composed of their school colleagues.

Sweden Pay is negotiated according to teacher characteristics (for example, secondary versus primary), the labour market situation (with teachers in shortage areas able to negotiate higher salaries), the performance of the teacher and the range of the teacher's responsibilities.

I put in a lot of extra hours and I felt that I was being paid for the job I was really doing

You can only hold people accountable for events within their control.

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