I find problems with both of these approaches. First, the teachers’ union wants across the board increases. This defeats the purpose of the incentive plan because putting more money into across the board salary increases reduces the amount that can be allocated for incentives. Incentives have to be large enough to motivate people to take the desired actions. For example, if the district wants a teacher to improve teaching skills with technology, the incentive to do so must be large enough to cause that teacher to get additional training or train him or herself in the requisite technology. Across the board pay increases do not create incentives for anyone to do anything other than stay in the current job. Both bad teachers and good teachers will stay longer. The key is to retain good teachers.
The problem with DPS’s system is not in the concept, but in the criteria for receiving additional pay. For example, if we examine the charter above, we see that the largest incentive is for attaining an advanced degree. This incentive is almost 10% of a teacher’s pay. The problem is that there is little evidence that advanced degrees increase a teacher’s effectiveness in the classroom. In fact, content knowledge is probably the least reliable indicator of improved teaching. On the opposite extreme, the incentive to work on teaching skills, which is an area that most improves effectiveness in the classroom, is only about 2% of a teacher’s pay.
An effective pay system must be aligned with the organization’s mission and goals. DPS’s mission is to:
"...to provide all students the opportunity to achieve the knowledge and skills necessary to become contributing citizens in our society."
In order to achieve this mission, DPS teachers need to be rewarded for practicing behaviors that contribute to this mission. Therefore, the pay system must reward behaviors, not specific achievements (such as attaining a degree or certification). DPS needs to figure out which behaviors lead to students to “become contributing citizens in our society.” Once DPS develops a list of these behaviors, they can set up an evaluation system that ranks teachers on their ability to display these behaviors. After that, they can set up an incentive system that rewards teachers according to the evaluation system.
I don’t mean to oversimplify. This is all hard work, but it’s what must be done for DPS to have a truly innovative and effective pay system. If they do this, they will retain good teachers and will attain their mission. Until then, both the teachers’ union and the district will be all wrong about merit pay.