Performance Pay: New York

Retaining Effective Teachers Policy


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

Does not meet goal
Suggested Citation:
National Council on Teacher Quality. (2011). Performance Pay: New York results. State Teacher Policy Database. [Data set].
Retrieved from:

Analysis of New York's policies

New York does not support performance pay. The state does not have any policies in place that offer teachers additional compensation based on evidence of effectiveness. 

Recommendations for New York

Support a performance pay plan that recognizes teachers for their effectiveness.
Whether it implements the plan at the state or local level, New York should ensure that performance pay structures thoughtfully measure classroom performance and connect student achievement to teacher effectiveness. The plan must be developed with careful consideration of available data and subsequent issues of fairness.

Consider piloting performance pay in a select number of school districts.
This would provide an opportunity to discover and correct any limitations in available data or methodology before implementing the plan on a wider scale.

State response to our analysis

New York pointed out that in addition to Teachers of Tomorrow, the state will be using a portion of its discretionary Race to the Top award to establish an Innovative Compensation Fund for LEAs. These funds are committed to recognizing (through development or leadership opportunities) and rewarding highly effective and effective teachers and principals through supplemental compensation based on the new performance evaluation systems. For example, LEAs could use such funding to provide highly effective and effective teachers with supplemental compensation to serve as mentors and coaches for other teachers and student teachers and to lead professional development programs within the LEA. The state will give priority funding to those highly outstanding teachers and school leaders who are employed in high-needs schools to help retention and ensure the equitable distribution of outstanding educators. New York will also establish a Transfer Fund through which LEAs can provide monetary incentives for highly effective teachers to transfer to high-needs schools within their LEA.

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: