Performance Pay: Nebraska

Retaining Effective Teachers Policy


The state should support performance pay but in a manner that recognizes its appropriate uses and limitations.

Meets a small part of goal
Suggested Citation:
National Council on Teacher Quality. (2011). Performance Pay: Nebraska results. State Teacher Policy Database. [Data set].
Retrieved from:

Analysis of Nebraska's policies

Starting in 2016, teachers will receive performance pay to link teacher performance to compensation. "Indicators of teacher performance may include improving professional skills and knowledge, classroom performance or instructional behavior and instructional outcomes. Teacher performance pay may include predetermined bonus amounts and payout criteria."


Recommendations for Nebraska

Support a performance pay plan that recognizes teachers for their effectiveness.
While it is commendable that Nebraska is considering a move toward performance-based compensation, it should guarantee a connection to student achievement and prevent local districts from basing financial incentives on other elements that may not be indicative of performance in the classroom. Further, the state should consider moving up the timeline for beginning this initiative.  

State response to our analysis

Nebraska recognized the factual accuracy of this analysis.

Research rationale

Research on merit pay in 28 industrialized countries from Harvard's Program on Education Policy and Governance found that students in countries with merit pay policies in place were performing at a level approximately one year's worth of schooling higher on international math and science tests than students in countries without such policies (2011). 

Erik Hanushek found that a teacher one standard deviation above the mean effectiveness annually generates $400,000 in student future earnings for a class size of 20. See Hanushek, Erik A. "The Economic Value of Higher Teacher Quality," National Bureau of Economic Research, Working Paper 16606 (December 2010).

In addition, numerous conference papers published by the National Center on Performance Incentives reinforce the need to recognize the limitations and appropriate uses of performance pay. See: