PERFORMANCE-RELATED PAY FOR TEACHERS - Taylor & Francis ...

Developments Paper

Abstract Per for manc e-related pa y (PRP) is being int rodu c ed for schoo lteac hers in Eng land and Wales at a time whe n po licy ma kers a re con cerned with the ‘m ission to mode rnise’ an d the requ ireme nt for ‘chan g e’ to tak e p lace in the pub lic s ec tor (Cabinet Office 199 9: 4) . In a numbe r of recent gove rnment pub lications, pub lic sec tor pay has bee n heralded as a n impo rtant m echa nis m that will e nsu re pub lic ser vices ar e ‘efficien t’ and of ‘high q uality’. Kes sler a nd Purcell (1992) exam ine th e mana g erial objec t ives und e rlying the c urrent a pplication of PRP in orga nizations an d prov ide a use ful fra mework to ex plore a nd evaluate PRP system s. The ir framewor k ha s bee n a dop ted to con s ider the implica tions of im ple menting PRP for tea chers.

Key words Educ a tion policy, New Labour , mo dern i za tion, p er form ance, pe rform ance related pay, teache rs

PERFORMANCERELATED PAY FOR TEACHERS An examination of the underlying objectives and its application in practice Gillian Forrester

Gillian Forrester Department of Education Keele University Keele Staffordshire ST5 5BG, UK Tel: 1 44 01782 621111 ext. 7436 E-mail: [email protected]

Vol. 4 Issue 1 2002 617–625 Public Management Review ISSN 1471–9037 print/ISSN 1471–9045 online © 2001 Taylor & Francis Ltd http://www.tandf.co.uk/journals DOI: 10.1080/14616670110070631

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Public Management Review

INTRODUCTION This article considers the role of performance-related pay (PRP) in the modernization of the teaching profession in England and Wales. The UK Labour government’s vision of the modernized profession is evident in the proposals of the controversial, consultative document, Teachers: Meeting the Challenge of Change (DfEE 1998, 1999). A PRP system is already in place for head and deputy teachers (Marsden and French 1998), but its extension to classroom teachers has met with strong opposition from the teaching unions (NUT 1999; O’Leary 1999). The restructuring of teachers’ pay from September 2000 enables those at the top of the nine spine points scale (£23,958 per annum) to apply to cross the new ‘performance threshold’ and receive an immediate £2,000 salary increase. To cross the threshold teachers have a more rigorous annual appraisal, have their teaching regularly observed and must meet predetermined performance criteria (DfEE 2000). Further pay increases on the new upper scale will depend upon sustained high performance. While the Government intends to ‘provide rewards for success and incentives for excellence’ (DfEE 1998: 19), the introduction of PRP has fundamental implications for the nature of teachers’ work, their working relationships and working environments especially as these arrangements potentially promote greater competitiveness and individualism (Kohn 1993; Procter et al. 1993; Ironside and Seifert 1995). THE KESSLER AND PURCELL FRAMEWORK The Government is seeking to improve the performance of school teachers and raise standards in schools and PRP appears to be a means for achieving these goals. The Government apparently has a number of objectives to accomplish as it invites teachers to meet the challenge of change. Kessler and Purcell (1992) examine the managerial objectives underpinning the current application of PRP in organizations and suggest these objectives fall into two sets. The rst is associated with the aims of traditional pay systems to recruit, retain and motivate staff; the second relates to the broader issue of organizational transformation. They contend that it is the second set of objectives which underlie the current use of PRP in organizations and that management is giving more attention to the use of payment systems to achieve organizational change. They identify three stages in the application of PRP: the establishment of individual performance criteria, how performance is assessed and nally they consider how pay is linked to performance. This framework has been adopted to analyse the proposed PRP system and considers some implications for teachers.

Forrester: Performance-related pay for teachers

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MANAGERIAL OBJECTIVES: TRADITIONAL Recruitment and retention Kessler and Purcell suggest that PRP is not necessarily used merely to reward individual employee performance, but can be a means of attracting ‘quality employees’ to the organization. In the education service, the Government faces an immediate crisis of attracting new recruits to the profession and the retention of existing teachers. Measures designed to attract the quantity and quality of new recruits and also address the abiding problem of low morale among existing teachers are outlined in the consultation documents. The Government perceives that the recruitment and retention crisis in education stems from insuf cient nancial reward for teachers and insuf cient recognition of excellent performance. There are strong concerns expressed by the School Teachers’ Review Body (STRB) regarding the fall of applications for teacher training (STRB 1999: paras 43–52). Despite attempts to address the problems of recruitment, applications for both undergraduate and postgraduate teacher training courses have been disappointing and the Government wished to seek ways to raise the image of teaching and provide greater rewards as incentives to recruit high-calibre individuals (Education and Employment Committee 1997: paras 44–51; STRB 1999: para. 47). Regarding staff retention, Kessler and Purcell suggest that PRP constitutes an effective means of sending the ‘right messages’ in an organization by recompensing high performance. It enables an organization to indicate what kind of performance is valued by rewarding the employees it wishes to keep and who it is prepared to relinquish. The Government makes it clear those teachers whose performance is ‘unsatisfactory . . . should leave the profession’ (DfEE 1998: para 83). The documentation does not suf ciently address how weak performance is to be managed as the appraisal or performance review does not form part of disciplinary or dismissal procedures. The new pay structure however is part of the package designed to improve the status of the profession and recruit and retain good teachers. Motivation The motivation and morale of teachers continues to be a concern (STRB 1999). Low morale has been attributed to a number of factors including increased workloads, work intensi cation, a plethora of initiatives from central government, an inadequately resourced system, the perceived low status of teaching and a general discontent about insuf cient pay levels. The introduction of PRP in education is based on the assumption that teachers will be motivated and their performance enhanced by the attraction and receipt of nancial incentives. Empirical evidence suggests that the intrinsic rewards of teaching, for example the satisfaction gained in being part of a child’s development,

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outweigh the extrinsic rewards of monetary gain (Forrester 2000; Forrester et al. 2000). Indeed research on PRP in other organizations raises doubts about the effectiveness of PRP as a motivating mechanism (Marsden and Richardson 1994). MANAGERIAL OBJECTIVES: ORGANIZATIONAL CHANGE Cultural change The modernization of the education service is part of a compelling agenda of reform across the public sector and PRP has been promoted as a signi cant mechanism within that process of change. Modernization requires that public sector employees take responsibility for their performance in a meritocratic environment that inculcates monitoring, surveillance and competitiveness. Modernization demands that there is a ‘change of culture’ which is ‘led from the top and driven throughout the organization’ (Cabinet Of ce 1999: 60). It also requires that public sector employees understand the arrangement that good responsible performance yields rewards. The Modernising Government document emphatically states: ‘We will make performance pay systems effective both as a reward for high-quality delivery and as an incentive to change behaviour’ (Cabinet Of ce 1999: 62). The Government appears to be introducing a system of PRP that will reinforce its goals for the education service and translate these into individual performance objectives. Kessler and Purcell argue that more recently PRP is being utilized ‘as part of managerial strategies for promoting broader organizational change’ (1992: 20–1). They propose that PRP assists in changing the culture of organizations to satisfy entrepreneurial needs. In recent years the education system has moved from a system that was entitlement-driven and producer-led to one that is both market-driven and government-led. The focus on school performance and results has intensi ed in this process of change. The single salary spine for teachers, while apparently appropriate for the old bureaucratic structures in education, does not sufciently re ect the organizational changes and support the development of a performance-orientated culture in education. It appears that PRP is being used as a vehicle to support or facilitate the broader process of reorganization and the restructuring of the teaching profession in the creation of ‘a new and positive culture of excellence and improvement’ (DfEE 1998: 6). The individualization of the employment relationship The focus on individual performance could potentially foster internal competition and, it is feared, this in itself will serve to undermine the notion of team-working which is characteristic in schools. This has implications for the continuation of ‘cultures of


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collaboration’ with teaching colleagues (Nias et al. 1989). Furthermore, the application of PRP fundamentally changes the nature of teachers’ employment relationship. Kessler and Purcell suggest that the rationale underpinning the individualization of the employment relationship has implications for weakening union power. In effect, it promotes a shift from collectivism to individualism while providing material reinforcement to managerial decisions. They contend: Performance related pay is unique amongst payment systems in stripping away those collective procedures and institutions which have obscured the essentially individualistic nature of the employment relationship. In doing so, the very mechanics of a PRP scheme provide opportunities for the greater exercise of managerial control. (Kessler and Purcell 1992: 23)

The inuence of the unions in negotiating teachers’ pay has been considerably eroded over recent years and teachers’ negotiating rights effectively removed. The introduction of PRP marks a further shift away from the traditional collective agreements towards devolved management structures in which pay is locally determined and there are more exible arrangements. A timetable for the implementation of PRP was imposed upon the profession and further illustrates the tightening of central control over education. Greater (nancial) control The issue of control is explored here in considering how the state manages teachers. The nineteenth-century crude system of ‘payment by results’ is illustrative of a period where government exerted direct control over the teaching force. Teachers were paid in accordance with the performance of pupils’ test results. However, control over teachers, as a professional group has not always been so visible and has taken different forms in different periods due to different social, economic and political circumstances. Grace (1985) illustrates how the notion of professionalism was mobilized and served as a more invisible ‘mode of control’ of teachers into the 1980s. It would seem that teachers experience phases of direct and indirect control (Menter et al. 1997: 59). The Government is concerned with the construction of ‘the modernized profession’ and ‘a new professionalism’ for teachers. However, it can be argued that the rhetoric of professionalization and the promulgation of enhanced professional status are illustrative of indirect control over the teaching profession. The appeal to teachers’ professionalism is conceivably a strategy for regulating teachers. Modernization is therefore not without its conditions. The prospect of obtaining greater nancial reward and enhanced professionalism is reciprocated by increased surveillance of classroom practice. As it appears, the linking of teachers’ appraisal and pay will provide a greater degree of control by management over the labour process at both a micro and macro level.

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THE APPLICATION OF PERFORMANCE-RELATED PAY Performance criteria One of the major concerns of the teaching profession is the establishment of appropriate performance criteria for appraisal. Whatever the measurement for performance assessment, it must be considered ‘acceptable’ and ‘fair’ by employees (Kessler and Purcell 1992: 24). While advocating the use of concrete performance measures for some groups, Kessler and Purcell suggest these indicators are not altogether suitable to assess the performance of professional groups. In other professional organizations they note the use of ‘softer’ or more qualitative performance criteria used in addition to or instead of the more concrete criteria. The Department of Education and Employment appointed management consultants from Hay McBer to undertake research to identify the characteristics of effective teaching and to develop performance threshold standards. The criteria or standards, which have been developed in a model to assess teachers’ performance, include the controversial linking of pupil progress with individual teachers’ pay. Much depends on the profession’s acceptance of these standards and whether they are considered appropriate in determining ‘effective’ teaching and ‘excellent performance’. The National Union of Teachers has been particularly active in opposing PRP and successfully challenged the Government in the High Court in July 2000 where it was ruled that the Government had wrongfully imposed the new performance standards without the approval of the Commons and the STRB. Implementation was delayed as a result which further fuelled teachers’ mistrust and scepticism of the Government’s proposed system. The maintaining of uniformity in the appraisal process within an organization where there are several appraisers is a problem identi ed by Kessler and Purcell. Their research ndings indicate that appraisers appeared to have various interpretations of the performance criteria and understandings on how performance should be measured; subjectivity and discretion thus playing a signi cant role in the appraisal process. Headteachers (or senior managers) will have responsibility for conducting appraisals and making recommendations as to whether individual teachers cross the threshold. Applications are to be veri ed by external assessors ‘drawn from a pool of nationallytrained experts’ (DfEE 1999: para. 26) who will then either agree with or overturn headteachers’ decisions. It seems somewhat ironic that a government apparently committed to reducing bureaucracy in education is seemly introducing a highly bureaucratic regime for the purposes of teacher assessment. PERFORMANCE ASSESSMENT A new and more rigorous appraisal system will be introduced and teachers’ performance assessed against the ‘effective teacher’ criteria identi ed by Hay McBer.


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This could potentially undermine the nature of appraisals with teachers focusing on the positive side of their work and not discussing areas requiring further professional development with their appraiser. Procter et al. (1993), emphasize the subjective nature of appraisal-related pay and performance measurement and also discern that appraisers tend to grade performance in the middle range of bands. By choosing the ‘soft option’ in the distribution of grades awarded for performance, appraisers avoided ‘dissension among the workforce’. Such ndings indicate that PRP is not a motivating mechanism when employees are appraised in middle bands and highlights the dif culties of achieving appropriate measures. Procter et al. (1993) suggest that some of the problems encountered with PRP in their case study organization could have been evaded with the existence of an effective appeals system. As yet, there is to be no appeals procedure for teachers. Procter et al. (1993) also found that most appraisers (managers) were men while the appraisees (production operators) were women and that the sexual division of labour has implications for the appraisal of female employees by male line managers. Similarly Bevan and Thompson (1992) identify areas where gender bias is liable to occur in individual PRP systems and conclude that some schemes may ‘unintentionally’ discriminate against women where the setting of targets and judgement of performance is based on ‘masculine’ criteria. They found that in organizations numerically dominated by women, individuals are likely to receive lower percentage pay increases than organizations dominated by men. The suggestion that women are disadvantaged by PRP schemes has particular implications for the teaching profession in which females make up a large proportion of the workforce, particularly in the primary sector. THE LINK WITH PAY The introduction of PRP for teachers has been contemplated for some time. The previous Conservative government was committed to the principle of PRP as a public sector pay arrangement (Cabinet Of ce 1991; Bach and Winchester 1994) and it is given consideration in the First Report of the Review Body: ‘We have no doubt that moves towards properly designed performance related pay would be right in principle: providing better rewards for the best teachers and clearly offering worthwhile incentives to motivate all teachers and improve their performance’ (STRB 1992: para. 62). Despite the inherent problems with the use of PRP in both private and public sector organizations, resistance from trade unions and research that casts doubt on its effectiveness, the Labour government is resolute in its determination to link teachers’ pay to their performance. The Government announced that £1 billion would be available for implementing the scheme in the rst two years. However from this amount the cost of training, employment of external assessors, the increase for annual appraisal and the accelerated increments for fast-track teachers have to be met. An

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inadequately funded system will in itself demotivate those it cannot afford to reward. CONCLUSION The implementation of a PRP scheme has been presented to teachers as a means of rewarding excellent teaching through a more rigorous appraisal system. Furthermore, there is the pressing need to make the profession more attractive through ‘better rewards’ and an ‘improved career structure’ to ameliorate the persisting teacher supply crisis. Performance-related pay, it is presumed, will motivate teachers, reward the most competent and attract and retain suf cient people of the ‘right calibre’. A modernized profession, it is advocated, will enhance the status and image of teachers and result in the ultimate goal of raising standards and achieving excellence in schools. The introduction of PRP, however, is a contentious element in the modernization of the education system in England and Wales. The prospect of obtaining greater nancial reward and enhanced professionalism is exchanged for increased surveillance of classroom practice. The new rewards system is a form of quality control over teachers’ work, which will be subject to increased monitoring and measurement. While purported to reward excellence PRP also appears to be part of a much wider agenda of policies to support or facilitate the broader process of reorganization and the restructuring of the teaching profession. Teachers question the very principle of PRP and the objectives underlying its introduction. The Government’s hurried and bungled implementation of PRP will undoubtedly have reinforced teachers’ lack of con dence in its application as a fair and appropriate means of remuneration. REFERENCES Bach, S. and Winchester, D. (1994) ‘Opting Out of Pay Devolution? The Prospects for Local Pay Bargaining in UK Public Services’. British Journal of Industrial Relations, 32:2 pp263–82. Bevan, S. and Thompson, M. (1992) Merit Pay Performance Appraisal and Attitudes to Women’s Work, Report No.234, University of Sussex: Institute of Manpower Studies. Cabinet Of ce (1991) Citizen’s Charter, Cm. 1599, London: HMSO. —— (1999) Modernising Government, Cm. 4310, London: The Stationery Of ce. DfEE (Department for Education and Employment) (1998) Teachers: Meeting the Challenge of Change, London: The Stationery Of ce. —— (1999) Teachers: Meeting the Challenge of Change. Technical Consultation Document on Pay and Performance Management, London: DfEE Publications Centre. —— (2000) Consultation on Standards for the Performance Threshold, http://www.dfee.gov.uk. Education and Employment Committee (1997) Teacher Recruitment: What Can Be Done? First Report, vol. 1, London: The Stationery Of ce. Forrester, G. (2000) ‘Primary Teachers and Performance Related Pay: Perceptions from the Classroom’. Paper presented at the British Educational Research Association Annual Conference, Cardiff University, 7–9 September.


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Forrester, G., Forrester, P. L. and Hassard, J. S. (2000) ‘Paying Teachers for Performance: A Comparison with Private Sector Experience’. Management Research News, 23:9–11 pp65–6. Grace, G. (1985) ‘Judging Teachers: The Social and Political Contexts of Teacher Evaluation’. British Journal of Sociology of Education, 6:1 pp3–16. Ironside, M. and Seifert, R. (1995) Industrial Relations in Schools, London: Routledge. Kessler, I. and Purcell, J. (1992) ‘Performance Related Pay: Objectives and Application’. Human Resource Management Journal, 2:3 pp16–33. Kohn, A. (1993) ‘Why Incentive Plans Cannot Work’. Harvard Business Review, 71 (September–October) pp54–63. Marsden, D. and French, S. (1998) What a Performance. Performance Related Pay in the Public Services, London: Centre for Economic Performance, London School of Economics and Political Science. Marsden, D. and Richardson, R. (1994) ‘Performing for Pay? The Effects of “Merit Pay” on Motivation in a Public Service’. British Journal of Industrial Relations, 32:2 pp243–61. Menter, I., Muschamp, Y., Nicholls, P., Ozga, J. with Pollard, A. (1997) Work and Identity in the Primary School. A Post-Fordist Analysis, Buckingham: Open University Press. Nias, J., Southworth, G. and Yeomans, R. (1989) Staff Relations in the Primary School, London: Cassell. NUT (National Union of Teachers) (1999) Teaching at the Threshold, London: National Union of Teachers. O’Leary, J. (1999) ‘Teachers Snub Blunkett and Call for Strike’. The Times, 3 April, p18. Procter, S. J., McArdle, L., Rowlinson, M., Forrester, P. and Hassard, J. (1993) ‘Performance Related Pay in Operation: A Case Study from the Electronics Industry’. Human Resource Management Journal, 3:4 pp60–74. STRB (School Teachers’ Review Body) (1992) First Report, Cm. 1806, London: The Stationery Of ce Ltd. —— (1999) Eighth Report, Cm. 4244, London: The Stationery Of ce Ltd.