Performance pay gets a boost in New York


If you pay them, they will come. That is the philosophy behind a publicly funded charter school coming to Manhattan in fall 2009. Zeke M. Vanderhoek, 32, the founding principal, will pay his teachers $125,000 a year—over twice the national average. And this idea of getting better performance for more pay, as simple as it sounds, is what has allowed him, he said, to turn his modest tutoring company into a multimillion dollar business.

It’s also an idea at the crux of educational debate: Should teachers—whose careers for decades have revolved around tenured positions, union-protections and seniority-based advancement—be subject to the same risk and incentives that salaried positions come with in other industries?

The new school, The Equity Project, places itself squarely on one side of that debate, banking its future on the assumption that pay incentives draw the most talented applicants, encourage the best performance, and that paying for it with a disproportionate share of the school’s budget gives the biggest bang for each educational buck.

“It’s certainly not my idea,” said Vanderhoek on a phone call from his office in lower Manhattan, where the school’s small administrative staff resides until the future school site in Washington Heights is ready. He explained that he got the idea only after seeing research and trends match his own experience as an entrepreneur of Manhattan GMAT, a multimillion dollar tutoring service he started from the ground up. The only differentiator that sets his company apart, he said, is that he pays his tutors the more than anyone else–$100 an hour, which is about five times more than competitors.

Indeed, the movement toward merit pay, or performance pay, as it’s variously been called, began as far back as the 1980s and now enjoys a sweeping influence over school districts in several states. Within the last three years, Minnesota, Florida and Colorado have jumped aboard. A ten-year-old nonprofit organization, Teacher Advancement Program, offers financial assistance to over 200 schools nationwide wanting to follow its own patterned program.

In a press conference on Tuesday, May 10, merit pay for teachers received an unequivocal endorsement from President Barack Obama.

All this despite the fact that research is hardly conclusive over whether paying teachers more or even tying pay to their performance actually improves student achievement, as generally measured by standardized test scores.

“I don’t know of any research study that has linked teacher quality with higher results,” said Leonie Haimson, an advocate for small class sizes and one of a number of school observers who think there are other improvements that confer the largest benefit per dollar spent. She points to studies demonstrating that small class sizes lead to less teacher attrition and leave students with more unfettered time to pursue class-related activities.

Advocates for teacher pay acknowledge this. A review of all scientific literature concerning teacher pay sponsored by the Center for American Progress turned up only small-scale studies in Israel and Kenya that showed a direct connection between teacher pay and student achievement. The review nevertheless concluded that pay-oriented models have promise.

Eric A. Hanushek, a research fellow at Stanford University who studies the economics of education and specializes in how teacher quality and class sizes impact student achievement, said few conclusions about classrooms can be reached with certainty because so many variables affect each student’s performance.

However, research does show, he said, that variations in teacher quality effect tremendous change in the classroom. While he said it is difficult to correlate a teacher’s performance with student achievement, several studies that compare teachers among one another in classrooms have found that differences in teacher quality showed huge variation among classroom achievement—that teachers, in effect, were the classroom’s single most important variable.

Research also shows that simply changing one variable in the classroom—say, inserting a good teacher into the mix—isn’t enough, he said.

“We’re almost certain that simple measures like reducing classroom size are not it,” he said, because changing only one variable, be it pay bonuses for teachers or heartier lunches for students, while leaving everything else intact, doesn’t improve the overall education experience.

Teacher Advancement Program (known simply as TAP), among the most widely implemented programs to feature a performance pay component, operates on this philosophy.

“There needs to be a comprehensive system in place,” said Jana Rausch, communications director for TAP. “Performance pay by itself doesn’t work,” she said.

TAP, founded by former investment banker Lowell Milken in 1999, bills itself as a professional development program for teachers. A nonprofit organization, TAP supports itself selling materials and consultation to schools that subscribe to its program of four principal components, including teacher career advancement options that don’t force the teacher to leave the classroom for administrative duties, regular feedback meetings between teachers and mentors, and performance pay bonuses. Schools in 15 states have adopted the program.

In lieu of available research, Rausch said the program’s methods are based on “working research,” in which teachers and administrators constantly compare notes and share techniques. Keeping teachers in the discussion loop has an added bonus, she said, of making labor negotiations easier.

Robert Weil, deputy director of education issues for the American Federation of Teachers, cites the Chicago TAP program as a good example of municipal school administration and teachers working together. Chicago’s schools, for example, have struck a deal with the local teachers union, in which teachers accept pay bonuses for achievement benchmarks, but teachers’ pay cannot fall below base-level pay. (As a strictly advisory group, TAP doesn’t play a role in management or pay negotiations in schools or school administrations.)

Indeed, Ron Davis, spokesman for the American Federation of Teachers’ New York City affiliate, said he considers Chicago’s TAP program as a model for a collaborative way to introduce performance pay into teachers’ labor contracts.

“We don’t have a problem with teachers being paid more money,” he said, as long as teachers are being involved in the process. “People seem to equate teachers’ unions with obstacles to reform, and that’s not the case.”

Among individual state initiatives, Minnesota’s Quality Compensation program is one of the most recent. Patricia K. King, director of the program, said it was based on TAP’s model and also tries to take a broad approach to performance pay.

The program began three years ago, when Minnesota’s education department wanted to look into options to reduce teacher attrition, she said. The program currently incorporates an evaluation process that includes two teacher observers and an appeals process, in addition to student achievement measured by test scores. Teachers who earn three successful evaluations over the course of a school year earn pay bonuses. There is also a “career ladder” component so teachers can earn promotions without leaving the classroom to pursue administrative roles.

Moreover, decisions over what to do with teachers who don’t make the cut are decided on a local level, and teachers unions are involved in each district’s contractual process.

“It’s more of a holistic program,” said Patricia K. King, director of the program, ” not just a smattering of pieces.”

Vanderhoek hasn’t based his charter school’s model on TAP; rather, he said he put it together using his own experience with his tutoring company and with feedback from his advisory board—a mandatory feature of public charter schools in NYC—that includes former school administrators and researchers.

(As for funding, Vanderhoek said all operation costs and salaries will be covered by the public money that New York City normally doles out to start-up charter schools; he is raising funds from private donors to construct the Washington Heights facility itself.)

And so he stands by his claim that high salaries will make a significant impact, while pointing out that his upcoming charter school will include teacher-mentor features and be transparent about expectations for pay bonuses and job retention. Right now a certain measure of success can be found in a flood of applications Vanderhoek said his school is receiving from experienced teachers around the country.

Vanderhoek also expressed skepticism that a syndicated program like TAP cannot predict all the unforeseen issues that a particular school in a particular neighborhood will face.

“Organizations are organic,” he said, “If you don’t allow yourself to evolve, it’s not going to work.”

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