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This brief builds on Motivation Tactics Within The DMC Human Capital Framework by discussing compensation-based mechanisms for enhancing teacher motivation. It provides an overview of the history and current state of variable teacher compensation plans, which have been shown to have a significant positive impact on student learning. Though public school districts have historically employed a single salary schedule, the drive for increased school accountability will likely shift more districts toward the incentive pay structures already popular in the private sector. This brief describes structural and organizational steps to design and implement a variable pay plan, and offers examples of successful programs.
K e y C o m p o n e n t s :
More in-depth analysis, implementation information, and tools for Motivation Through Incentive Compensation are available through the The District Management Council (DMC). Please call toll-free 877-DMC-3500 .
The Evolution of Teacher Compensation American public education has followed a varied path of compensating teachers. The prevailing practice of the 1800s was to have local communities pay teachers primarily through room and board. As the American economy became more complex and industrialized in the late 1800s, the demand for more specialized education led to a position-based salary system, which distinguished teacher pay by grade and assignment. The differentiation, however, eventually produced charges of bias detrimental to women and minorities. By the mid-1900s, a single salary schedule, with predictable and objective increments regardless of grade, race, or gender, had gained dominance. This monolithic system of set steps and levels has remained the norm for school districts across the country.i
Starting in the 1980s, various efforts moved to break free of the single salary schedule and replace it with variable, performance-based systems. Usually referred to as “merit pay,” these pioneering systems sought to improve teacher quality and enhance the allure of the teaching profession. Yet change proved difficult and highly limited. Inadequate funding, the emergence of divisive and competitive teacher work environments, and overly subjective assessments of merit conspired against an overhaul of the compensation system.ii
As of 2004, according to the U.S. Department of Education, 93% of all public school districts continued to employ the single salary schedule. By contrast, a study by Hewitt Associates found that 80% of U.S. businesses have adopted at least one variable pay plan. Private and charter schools are also far less tied to a conventional salary schedule than are public schools.iii It is logical to conclude that the popularity of variable systems will penetrate public schools more and more. Increased parental choice and subsequently greater competition from private and charter schools, as well as the drive toward more accountability and regular assessment, should encourage the adoption of variable pay models.
