Performance-based Pay for K-12 Teacher
Compensation in Taiwan?
洪信令 美國北達科塔大學
Governments play a significant role and invest large amount of funds in providing education for their citizens. From an economics standpoint, investments are expected to be cost-effectiveness as in the private sector. Producing higher student performance is considered to bring great returns for society (Hanushek, 2005). Studies indicate that the quality of teachers is a key element affecting student achievement (Hanushek, 2005; Sclafani, 2010; Spring, et al., 2012; Tuck, Berman, & Hill, 2009). Based on input-output logic and the economics principle mentioned above, better teacher quality (input) should lead to higher student performance (outputs). That assumption and along with accountability suggests that government should focus on improving the quality of the teaching force. However, effective teachers are hard to attract and retain in schools because there is shortage of them (Sclafani, 2010) partly due to young, talented people tending to not respect a career in teaching (Hanushek, 2005). One factor here is that pay is a critical consideration (Hanushek, 2005; Sclafani, 2010). Thus, recent US education reform has examined alternative teacher compensation strategies or incentives such as performance-based or merit pay.
Although a teacher shortage has not been an issue in Taiwan, lack of quality is, especially in the hard-to-staff areas. Based on personal observation, teaching as a profession in Taiwan is getting less respect than it should and the role of teachers are more multifaceted as student populations become diverse and parental expectations particularly for academics have kept increasing. In terms of teacher supply in Taiwan, recent educational policy allows all higher education institutions to participate in teacher preparation and in contrast to the past, today’s teacher education programs are more appealing to those with weaker academic background or whose first professional
choice is something other than education. Complicating matters further is that while the teaching context has changed drastically, the salary structure in Taiwan remains static. Therefore recruiting and retaining high qualified teacher may be negatively impacted and this is relevant to Taiwan’s future and it is worthwhile to explore teacher compensation systems.
Investigating effective pay for teachers is important. Many countries (Georgia, Kenya, India, the United Kingdom, the United States) have experimented with competency-based pay or reward approaches (Kobakhidze, 2010). Such considerations are absent or quite limited in Taiwanese literature. In this paper I explore the lessons (successes and barriers) experienced by others and to see if they could be applied to Taiwan’s K-12 teacher compensation system.
I. Needs for Restructuring Teacher Compensation
Similar to the salary structure used in the US and many countries in the world, Taiwan’s K-12 teachers are paid with a fixed-rate salary schedule in a two-dimensional matrix that allows for differentiation only by educational attainment and years of teaching experience, even though these variables are poor indicators of the performance of educational systems (Muralidharan & Sundararaman, 2011; Young, et al., 2004). The traditional salary structure provides little incentive for merit and motivating extra effort (Lavy, 2007). It is also contrary to competency-based pay employed by other professions in the competition for a high quality workforce. Creating new or extending the existing salary schedule beyond simple recognition of education and experience might reward effective teachers and over time improve Taiwan’s education.
How to design a better salary structure is a daunting task. Experimenting with various compensation schemes to identify feasible approach(es) would be one way, however, education systems do not have the resources and time to do such experiments. So learning from others or looking at research would be useful. There are studies examining teacher incentive or performance-based pay. They provide valuable insights for Taiwan.
II. Teacher Performance-based Pay Models
Various forms of alternative teacher pay schedules have been implemented in the US and across the globe. In the US, the Virginia Department of Education (2011) included career ladder, knowledge- and skill-based plans, and individual evaluation as part of teacher compensation guidelines. Jensen, Yamashiro, and Tibbetts (2010) observed knowledge- and skill-based pay, individual-based performance pay, school-based performance pay, and combined plans are common types of performance pay plans. Rice, et al. (2012) noted four incentive programs: ―pay for student achievement, pay for professional growth and contribution, pay for teaching in hard-to-staff subject areas, and pay for working in hard-to-staff schools‖ (p.900).
Lavy (2007) identified three performance-based reward systems-- merit pay, knowledge- and skill-based compensation, school-based compensation and is supportive of merit pay generally rewarding individual teachers based on student achievement. In the US, since the mid-1990s, some states (Florida, South Carolina) and districts (Denver, Dallas) have started merit pay schemes at both the school and individual level (Figlio & Kenny, 2007). The knowledge- and skill-based compensation offers incentives to teacher based on their skills (Lavy, 2007). Chile, Germany, the Netherlands, Singapore, and U. S. rewarded teachers with a focus on teachers’ new knowledge and
skills (Sclafani, 2010). This differs from the merit pay based on student performance. School-based compensation provides incentives to schools predicated on school-wide student performance (Lavy, 2007; Sclafani, 2010). Brazil and England reward high performing schools. Australia, Bolivia, Canada, Chile, China, Denmark, Ireland, Korea, New Zealand, Peru, and U. S. used financial incentives to encourage teachers to serve in hard-to-staff schools (Sclafani, 2010), which is another form of compensation. Table 1 has features of common types of US performance-based programs followed by the next section which focuses on challenges and benefits.
Table 1: Common Types of Performance-based Programs in the US
Model Feature
Merit-Based Pay
Teachers receive bonuses based on improvements in their performance evaluated by specified indicators
Teachers compete for bonuses
Modification to a single salary schedule
Mostly individual teacher based awards
Team awards targeted to grade-levels, departments, or combinations
Knowledge- and Skill-Based Pay
Base-pay increase or bonus for acquisition of new skill/competency and knowledge and/or applying those new skills.
Compensation not linked student achievement or teacher performance in the classroom
Denver Public Schools’ ProComp and The Teacher Advancement Program (TAP) are examples
Career Ladder
Performance-based ladders
Job-enhancement ladders
Professional development ladders
Minnesota’s Q-Comp (traditional career ladders and professional development for teachers) and Utah Career Ladder Plan are examples
School-based Performance Pay
School-level plan with school-wide performance indicators
Single salary schedule with onuses
All professional staff in a school earn bonus if students meet goals.
Blended model
Could include individual/skill-based and school-level performance measures
Additional pay on top of salary for skills, student achievement
Now let us turn to selected aspects of systems as well as challenges and benefits.
1. Primary Goals
Recruiting and retaining qualified individuals for teaching and encouraging their stay in position are the driving forces generally associated with introduction of incentive program. Countries such as Chile, England and Wales, and Singapore have offered inducements to attract high quality students into teacher education programs (Sclafani, 2010). In the past Taiwan’s teacher education colleges and normal universities offered free education for students as the recruiting mechanism. A second objective is to retain and reward current teachers. Many compensation systems reviewed by Sclafani (2010) were designed for this purpose. Additionally, some approaches were designed for both of the above goals. Sweden for example implemented an individualized salary program to recruit and retain teachers to improve the quality of education (Sclafani, 2010). The Financial Incentive Rewards for Supervisors and Teachers (FIRST) program at the Maryland Prince George’s County Public Schools (PGCPS) is another example emphasizing both purposes (Rice, et al, 2012).
2. Evaluation indicators
All incentive programs require establishment of specified criteria to determine whether to give reward. Two of them are educator evaluation and student outcomes (Rice, et al., 2012). The former includes teacher evaluations based on performance (data from classroom observation and teaching portfolio assessment) and knowledge and skill indicators (training records). School-wide student performance sometimes comes from student assessment data primarily from state tests. Leigh (2013) stated that test scores, dropout rates, attendance rates, surveys (of parents, staff and students),
principal assessments, and external evaluator reports constitute the information used. Because of the weaknesses of single indicators, multiple measures have been underscored by several authors (Leigh, 2013; Rice, et al., 2012). These might include multiple years of data on standards-based teacher evaluations and student test scores.
Mizala and Romaguera (2004) classified reward criteria into three categories—inputs, processes and outputs. Qualifications, experience, hours worked, grade taught, and working in a socially disadvantaged area are examples of the input criteria. Process criteria are professional development courses taken, extracurricular activities engaged in, working with parents, etc. Data on student drop-out and completion rates, student achievement, and parent satisfaction are illustrations of outputs.
3. Types of Incentives
Two categories of incentive are material and nonmaterial incentives, but Kobakhidze (2010) classified them into three categories: ―monetary incentives, nonmonetary (tangible) incentives, and nonmonetary (intangible) incentives‖ (p.80). Monetary rewards are obvious. Nonmonetary tangible rewards include coupons and vouchers and nonmonetary intangible benefits are social recognition and public praise. Ways to receive incentives might be ―salary supplements, bonuses, opportunities for professional growth, pensions, social recognition, teaching materials, infrastructure, job stability‖ (Kobakhidze, 2010, p.69), additional holidays, reduced teaching load, promotion, and public recognition (Lavy, 2007). Awards could be either a one-time event or ongoing leading to a permanent addition to salary (Lavy, 2007).
Improving teacher quality and student learning are the reasons and benefits for implementing merit/performance-based pay (Figlio & Kenny, 2007; Lavy, 2007; Lussier & Forgione, 2010; Muralidharan & Sundararaman, 2011; Podgursky & Springer, 2011; Sclafani, 2010; Springer, et al., 2012). Lavy (2007) pointed out ―productivity and efficiency considerations‖ as potential benefits of performance-based pay. He reasoned that: (a) individual performance-based pay schemes improve efficiency by linking teacher’s effort to students’ achievement; (b) the output-based merit pay model leads to efficiency by attracting, selecting, and retaining productive teachers, and (c) individual or team based performance pay schemes enhance school governance and better outcomes. Another advantage is in the negation of the inequality of traditional compensation based on experience and qualification but not effective teaching, so performance-based pay can make compensation systems more fair (Lavy, 2007).
On the other hand there are criticism of performance-based pay. There are problems in measurement (Kobakhidze, 2010; Lavy, 2007; Lussier & Forgione, 2010), negative effects on organizational climate and collegiality (Kobakhidze, 2010; Lavy, 2007; Leigh, 2013; Lundström, 2012), and unintended/undesired consequences (Kobakhidze, 2010; Lavy, 2007; Leigh, 2013; Lundström, 2012; Sclafani, 2010). Measurement concerns are subjectivity and inaccuracy in traditional teacher evaluations, evaluating progress toward a goal fairly and accurately, the use of student achievement data as indicator without partialing out students’ backgrounds, and difficulty in defining and assessing teaching effort/output. Competition and hierarchy among teachers, demoralizing teachers by gaming the reward system, and negative effects on teacher motivation and collaboration are related to organizational climate. Teachers focusing on short-term gains, teaching to the test, manipulation of test scores, and neglecting
unrewarded tasks are unintended/undesired consequences. Other criticisms are about nonmonetary incentives (Kobakhidze, 2010), and high costs (Lavy, 2007).
III. Effects of Performance-based Pay Programs
Empirical studies so far show inconclusive results (Lavy, 2007; Springer et al., 2009). Sclafani (2010) reported positive effects in India, Israel, and Kenya via experiments with incentive programs. Condly, Clark, and Stolovitch (2003) summarized the results of 600 studies on incentives and concluded that ―the average effect of all incentive programs in all work settings and tasks was a 22 percent gain in performance‖ (p. 46). They also found team-based incentives had a better effect on student performance than individual ones. Monetary incentives resulted in higher performance than non-monetary ones (Kobakhidze, 2010).
Recent international studies noted positive effects of pay-for-performance systems on student achievement (Muralidharan & Sundararaman, 201; Springer, et al., 2012). In the United Kingdom (UK), significant student progress in secondary education was observed (Lavy, 2007). Also, PISA results revealed that student achievement is higher in countries exercising performance pay than countries without it (Woessmann, 2011).
In contrast, Lundström’s (2012) study on the effects of Swedish’s individual performance-related pay (PRP) scheme indicated that there was no clear connections between teacher salary, motivation for extra effort, and improved educational outcomes. Kobakhidze’s (2010) study on Georgian system concluded that the long-term effect of teacher incentives and enhancing the quality of education remains a question for further study. In the US, experimental evidence from the Round Rock Pilot study indicated no effect of the pay-for-performance structure (Springer et al., 2012). That is
consistent with other recent experiments, including those of individual- or school/group-based performance pay.
Podgursky and Springer (2007) acknowledged that the literature on the effect of the performance pay program is varied in terms of incentive design, population, type of incentive (group vs. individual), strength of study design, and duration of the incentive. Yet in every case, the evidence suggests that teachers responded to the incentives. Even where mixed findings were reported, the incentive scheme always had an effect on teacher behavior (Podgursky & Springer, 2007).
IV. Implementation Consideration and Conclusion
Performance-based pay models were introduced to overcome the weakness of traditional salary schedule for better education outcomes. As noted earlier, they not only have advantages but also pose many practical challenges. Some of the latter can be addressed through careful design of the system. Structuring incentives more on teacher recognition, fair and transparent administration (Muralidharan & Sundararaman, 2011), strengthening the linkages between accountability systems and professional development programs (Kimball, 2003), securing and maintaining stakeholder support (Rice, et al., 2012), and developing and implementing accurate and credible measures for the linkage between incentives and teaching quality and effort (Kobakhidze, 2010; Rice et al., 2012) are potential strategies.
Using incentives to recruit high quality teaching force has been implemented in Taiwan for years. Recently, however, the diversified teacher education policy has cut the amount of fund available and may endanger future teacher quality, especially for hard-to-staff schools. Restoring federal funds for recruiting more high qualified
individuals into teacher education programs for free education conditional on teaching in disadvantaged schools after graduation could be helpful.
Reward for teachers is more heavily on experience than merit in Taiwan. Linking the recognition to effective performance can be a partial alternative in addition to money for developing a performance-based compensation system in Taiwan. It could be implemented on individual or school basis. Since change may encounter resistance in and outside of the profession, involving teachers in the planning process for support and trust is essential.
Overall as to whether to include performance-based pay in K-12 teacher compensation in Taiwan depends on answers to the following questions: Will implementing such system improve teacher quality? Will it encourage effective teachers? How will it be evaluated and monitored? Will it be supported by teachers? Will it be cost-effectiveness? Will there be enough funds for implementation?
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