While giving local districts authority over pay scales, the state should ensure that effectiveness is a factor in teachers' compensation. This goal is reorganized for 2021.
Salary Requirements: Arizona gives local districts the authority to set pay scales, eliminating barriers such as state salary schedules that control how districts pay teachers. The state allows the local governing board to "employ and fix the salaries and benefits of employees necessary for the succeeding year."
Performance Pay Policies: Arizona's Classroom Site Fund directs districts to allocate 40% of the monies for "teacher compensation increases based on performance and employment related expenses." Arizona ties this 40% allocation to its teacher evaluation framework and specifically requires the individual teacher performance component to account for 33% of the allocation. The state further articulates that districts are required to adopt a performance-based compensation system at a public hearing to allocate monies from the Fund.
Arizona Revised Statutes 15-502(A), 15-977 SB 1139 (2021)
Discourage districts from tying compensation to advanced degrees or experience.
While still leaving districts the flexibility to establish their own pay scale, Arizona should articulate policies that definitively discourage districts from tying compensation to advanced degrees, in light of the extensive research showing that such degrees generally do not have an impact on teacher effectiveness. Similarly, Arizona should articulate policies that discourage districts from determining the highest steps on the pay scale solely by seniority.
Strengthen the link between performance pay policy and evidence of effectiveness.
Although Arizona's Classroom Site Fund generally connects compensation and teacher evaluation, the state is encouraged to strengthen this policy by more specifically tying performance pay to evidence of effectiveness.
Arizona recognized the factual accuracy of this analysis.
Compensation reform can be accomplished within the context of local control. Teacher pay is, and should be, largely a local issue. Districts should not face state-imposed regulatory obstacles that prevent them from paying their teachers as they see fit; different communities have different resources, needs, and priorities. The state can ensure that all teachers are treated fairly by determining a minimum starting salary for all teachers. However, a state-mandated salary schedule that locks in pay increases or requires uniform pay deprives districts of the ability to be flexible and responsive to supply-and-demand problems that may occur.
While leaving districts flexibility to decide their own pay scales, states should promote compensation tied to teacher effectiveness and discourage districts from basing pay solely on criteria not correlated with teacher effectiveness. Across the country, state and district salary schedules are based primarily on just two criteria: advanced degrees and years of experience, neither of which is correlated with teacher effectiveness. The impact of advanced degrees on teacher performance has been studied extensively, and research has shown that such degrees generally do not make teachers more effective. Years of experience do have an impact on teacher effectiveness very early in a teacher's career, but this effect appears to fade out after the first few years of teaching. Because of their predominance in current salary schedules, states need to take a proactive role in preventing districts from basing teacher pay primarily on these two criteria.
Performance pay is an important recruitment and retention strategy. Performance pay provides an opportunity to reward those teachers who consistently achieve positive results from their students. The traditional salary schedule used by most districts pays all teachers with the same inputs (i.e., experience and degree status) the same amount regardless of outcomes. Not only is following a mandated schedule inconsistent with most other professions, it may also deter talented individuals from considering a teaching career, as well as high-achieving teachers from staying in the field, because it offers no opportunity for financial reward for success.
States should set guidelines for districts to ensure that plans are fair and sound. Performance pay plans are not easy to implement well. There are numerous examples of both state and district initiatives that have been undone by poor planning and administration. As the use of value-added models now allow for the development of a more meaningful understanding of teacher effectiveness, districts should ensure that performance pay systems consider both qualitative and quantitative measures in order to fairly assess and compensate teachers for their performance.
States can play an important role in supporting performance pay by setting guidelines (whether for a state-level program or for districts' own initiatives) that recognize the challenges in implementing a program well. A few states now require that districts build performance into salary schedules, moving away from bonus structures that teachers know may be subject to budget constraints and competing priorities.