Most public school teachers in Michigan are paid according to a seniority-based salary schedule, which awards compensation according to a teacher’s years of experience and level of education. The same is true nationally.[248]

This stands in contrast to most other areas of commerce and industry, where employees working under a "merit-based" schedule receive compensation that is commensurate with their job performance and productivity. It also stands in contrast to a nationwide trend. The New York Times reports that Arizona, Florida, Iowa, New Mexico and North Carolina currently have programs that reward teachers for classroom performance.[249] It was also recently reported that a new Washington, D.C., teachers contract would provide a bonus program based on increases in student performance.[250]

A procedural flaw in many seniority-based step salary programs is that growth is artificially accelerated early on in a teacher’s career, with a sudden stop at the top of the scale. Perhaps more importantly, recent research indicates that only 5.5 percent of conventional public school districts nationwide use any kind of incentives, such as cash bonuses or salary increases, to reward excellent teaching.[251] Indeed, some researchers have concluded that the failure to reward teacher ability is primarily responsible for a decline in the aptitude of many teachers entering the teaching profession.[252]

Despite the lack of flexibility in teacher compensation based on seniority, many union officials maintain that the fairest system is the seniority schedules that punish the very teachers they represent. One contract provision even bluntly stated, "Under no condition shall a teacher be compensated above his/her appropriate step on the salary schedule."[253] Such contract language can serve only to dampen teacher motivation, initiative and performance, and it leaves students on the losing end. Nevertheless, a union leader in Massachusetts stated that merit pay is "inequitable, divisive, and ineffective."[254]

To protect their management prerogative, school boards should remove seniority-based salary schedules from their collective bargaining agreements. In place of seniority pay, the school board should institute performance-based pay scales that reward outstanding teachers, encourage innovation and attract the best people for the important job of educating tomorrow’s leaders.

A performance-based salary schedule can be based on either teacher performance or student performance. The Michigan Legislature in 1995 strengthened school districts’ rights to create performance-based salary systems when it passed Public Act 289 into law. Public Act 289 states in part, "A school district or intermediate school district may implement and maintain a method of compensation for its employees that is based on job performance and job accomplishments."[255]

In 1993, then-AFT President Albert Shanker himself proposed performance-based pay, acknowledging that such a system could be developed without being anti-union and its flaws "would be very small compared to what we have now or compared to what you would have without such a system."[256]

Some school districts are beginning to respond to the changes in Michigan law. The Saginaw district was successful in bargaining a portion of their teachers’ salaries based on the requirement that teachers meet certain districtwide goals adopted by the school board.[257] The Fennville school district has taken a hybrid approach, with teachers receiving a 1 percent raise for each year of the two-year contract, another 0.75 percent increase should revenues rise substantially, and a final 0.75 percent increase based on improved Michigan Education Assessment Program test scores.[258]

Jeff Steinport: "School boards should not only consider replacing seniority-based salary schedules; they are doing the public and the students a disservice by not doing so. Without flexibility in pay, hardworking and innovative teachers are paid the same amount as poor and underperforming teachers. There’s no sector of the economy that operates that way and operates effectively."

 

Donald Wheaton: "My initial reaction is that performance-based scales don’t really work when you have no control over the raw materials, as it were: the children who seek your district’s services. "If" you have a citizen population that is nearly universally sending to school students who are truly ready to learn every day in virtually every way (prior preparation, had breakfast, got a good night’s sleep, etc., etc.), then I would think performance-based scales might work and could be a good incentive."