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Contents : Creating a Successful Performance Compensation System for Educators July 2007 This document reflects the findings of the Working Group on Teacher Quality whose participants share information and build consensus among organizations and experts active on the issue of performance pay and teacher compensation reform. Participants of the Working Group on Teacher Quality include: Association of American Educators National Council on Teacher Quality Augenblick Palaich and Associates Inc. National Institute for Excellence in Teaching Center for American Progress New Teacher Center Community Training and Assistance Center The New Teacher Project Full Circle Fund Resources for Indispensable Schools and Educators National Commission on Teaching and America's Future State policymakers district leaders principals teachers school board members parents and business leaders interested in creating effective teacher compensation and support systems may use the recommendations in this document to better understand the lessons the members of the Working Group on Teacher Quality have learned in implementing alternative compensation for teachers throughout the country. This document serves to inform decision makers of the essential factors to consider when designing and implementing a performance-based compensation system. This project was funded by the Joyce Foundation and coordinated by the National Institute for Excellence in Teaching. Examples of the principles outlined in this paper are included in the online version of the paper available on the websites of participants and at www.talentedteachers.org. These examples are illustrative and are not intended to reflect an endorsement or recommendation by the group. More examples will be included over time as we receive feedback and additional information on projects. 2007 by National Institute for Excellence in Teaching. All rights reserved. Well-prepared high-quality teachers are essential if we are to ensure that all students achieve the high standards necessary to lead fulfilling lives and become productive citizens. In today s competitive marketplace it is increasingly difficult to attract and retain excellent teachers. To accomplish this we must provide salaries commensurate with their education experience the challenging and complex tasks they perform as well as the success they experience in performing these tasks and the workplaces in which they operate. Many schools and communities are exploring ways to attract develop motivate and retain excellent teachers by providing increased compensation through performance-based pay. Across the country states districts and schools have experimented with performance pay for teachers with varying degrees of success. From these real-world experiences it is clear that a number of crucial elements are necessary to make performance-pay systems work in schools. Here we outline some of the most important design elements of successful performance-pay plans and recommendations for implementation. Design Elements 1. Ongoing Job-Embedded Professional Development 2. Performance-Based Compensation 3. Evaluation Based on Professional Standards 4. Career Advancement Opportunities Implementation Recommendations 1. Sufficient and Stable Funding 2. Communication and Teacher Buy-In 3. Skilled Leadership 4. Target High-Need Schools and Subjects 5. Include a Program Evaluation and Monitoring System 6. Integrate and Align Other Systems to Compensation System 2 DESIGN ELEMENTS OF AN EFFECTIVE PERFORMANCE COMPENSATION SYSTEM Design Element #1: Ongoing Job-Embedded Professional Development Includes an integrated results-driven job-embedded professional development component. Teacher compensation should not be considered in isolation but instead must be part of a comprehensive teacher quality system that supports teacher development and best practice. A very important element in a performance-pay system is a strong ongoing professional development program. If teachers are to be paid based on performance teachers need the tools and the time to learn and implement the skills that foster higher levels of performance. This requires opportunities for professional development during the school day. School schedules must be structured so that collaborative learning communities can develop where teachers have time to work with each other and to create improved learning opportunities for their students. The professional development program should be school-based and focused on the instructional needs of individual students and strengths and weaknesses of teachers. It should be developed and directed by master and mentor teachers who provide ongoing coaching and individual assistance to teachers in their classrooms to help further improve their skills and knowledge. The program should provide teachers the opportunity to observe accomplished practitioners collectively analyze student work reflect with peers

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