[Content revised 28/08/2014]

Where do you start with the need to have a pay policy for your school?  The poly should refer to:

• Salary progression;
• Performance related pay;
• Links to the Teachers’ Standards;
• Improved outcomes for the children;
• Motivating staff;
  
• The issue of affordability.

Reinforcing the School’s Key Goals

The starting point is not writing your pay policy. The first step is to consider the bigger picture as your pay structure should help to reinforce the service needs of your school and therefore should be designed for that context. Ask yourself what improvements does the school need to accomplish over the next three years, especially in outcomes for pupils? The picture below shows the key elements in the design of a pay structure that reinforces the key goals and recognises the interdependence of the key elements.

Identifying the key goals of the school has two major benefits:

• It will be easier for you to extract core objectives that the majority of your teachers will need to focus on.
• Through their involvement, the Governors should be able to track progress against the important goals and know what measures are appropriate for that purpose. This will help to demonstrate effective governance to Ofsted but also ensure that the school is continuously improving
  

The Governors and Head Teacher should be involved closely in this so they and the Senior Leadership Team are clear about the future direction; what has to be achieved in each year and how progress will be measured.

Objectives for Staff

The core goals that are essential to meet the service needs should be broken down into manageable objectives and sub objectives for the appropriate year. Those objectives will often be complemented with particular objectives for an individual which together will form the teacher’s personal set of objectives.

Staff appraisal is a topic in itself. This article is focused on designing the pay structure and determining an individual’s pay. However, in a a performance related pay structure you should bear in mind the following;

• When setting objectives you are legitimising certain behaviours to achieve those ends. Does it matter how staff go about achieving those? If it does, you should consider adding qualitative measures to the objectives to minimise any adverse behavioural outcomes.
• Are there specific performance measures that every teacher must meet to be assessed as effective? That might, for example, refer to a certain level of improvement of learning outcomes across the school.
• Be careful about using emotional and inflationary terms such as ‘good’ performance. Organisations find that terms such as ‘effective’ are better.
• Linking back to the Teachers’ Standards is a requirement but that will require you to consider:
  • What expectations do you have of a teacher in say the first half of the Main Pay Range compared to the second half?
  • What expectations do you have of a teacher at the lower end of the Upper Pay range compared to one at the maximum?
  • Holding a reasonableness workshop of ‘assessors’ to examine and chart those expectations in order to clarify the requirements and facilitate a consistent application.

Designing the Pay Structure

A pay structure is part of your reward and recognition strategy. Pay is important but not the sole motivator for professional staff who are also interested in personal development opportunities and other forms of recognition. I make that statement now so it is not lost as I explain below some elements of putting together a school pay structure.

Your context – you need to take account of your context when designing a pay structure including:

• Your school’s goals
• The freedom you have to take a flexible approach to rewarding staff. The DfE sets the parameters each year such as the minimum and maximum of the pay ranges but you are able to decide on salary progression and the value of an individual’s contribution.
• Any strong expectations of staff regarding pay increases. New entrants and those who have not reached the maximum of the range will up to now have assumed their pay will increase along the current scales. Depending on the changes you make, will those expectations need to be reshaped or are those so entrenched that your freedom will be limited in the first year or so? The 2014 School Teachers’ Pay and Conditions Document (STPCD) emphasizes that a teacher who is appraised as good should have an expectation of receiving an increase.
  
• Do allowances or other pay supplements form a significant part of staff’s earnings? The Review Body indicated that 27% of primary and 56% of secondary teaches received allowances (1). The 2014 Teachers’ Conditions provides more flexibility for using allowances to reward staff.
• Can you afford (or not afford) to put more money into the pay budget to focus individuals on important key improvements? Performance related pay assumes a degree of flexibility which is in addition to any general uplift decided by the DfE minimum and maximum of the pay ranges
• When pay is affected by performance, consistency of assessments is important as staff will make their own value judgements. You should consider training for your assessors of performance and of pay so that objective and consistent decisions are made

With those points in mind let us examine some of the options open to schools for their pay structure from September 2013. We shall discuss the following elements:

• Progression within pay ranges
• Putting values to pay markers along the ranges
• The learning curve and ‘mature’ teaching skills

Progression within Pay Ranges

The current pay scales give individuals an increase of 8% on the Main and 4% on the Upper Scale. Several options are given below for consideration. Some are relatively safe options should you wish to build your own confidence in applying performance related pay.

The DfE will provide the minimum and maximum of the pay ranges. In its submission to the Review Body, the DfE suggested a 1% uplift to the minimum and maximum of the ranges but we shall have to await the conclusions. In the meantime, you can determine the markers (pay reference points) along the new pay ranges. If you wish to develop confidence and balance staff’s expectations of salary progression to which they were looking forward, you may wish to place the markers at similar points to now (allowing for any uplift to the range). That still leaves you with a significant advantage in managing pay and performance as explained below

Main Pay Range – currently your decision is limited to either no rise or a whole one or two point rise. From September, you can adopt one of many options as illustrated below.

Option 1 – You could mirror a similar arrangement to the current pay scales by establishing 4 markers of 8% each between the minimum and maximum of the range. You could adopt a similar all or nothing approach to the award of a pay rise i.e. an individual could be awarded an increase to the next marker (or two for highly effective performance) or no rise for not achieving the required levels. That is a safe option but denies you the flexibility to deal with the many situations you will need to address.

Option 2 – if you subscribe to the view that performance related pay is to encourage and reward those who are demonstrating clear progress on objectives, you may wish to implement a structure that gives you more freedom. As in option 1, you would establish 4 markers of a set % each between the minimum and maximum of the range. If an individual has achieved a significant part of his objectives and is committed to achieving the rest, you could award a percentage of the marker point (e.g. 70%) to encourage him to keep on raising performance. Similarly, those demonstrating high on going performance could be awarded more than 100% of the marker point e.g. 150%. The emphasis in the latter case should be on performance that will be sustained as the Teachers’ terms still state that any rise is permanent while the individual remains employed at your school.

This option is more realistic as it gives you the flexibility to take account of the circumstances in which the objectives had to be performed, the degree of success and the individual’s determination to succeed.

Option 3 – similar to option 1 except that 9 markers of say 4% each.are established within the minimum and maximum of the range This gives the ability to increase salary by two markers (the same percentage as on the current scales) or by one marker if performance falls in less critical objectives. This option may be suitable in some schools but it does reduce flexibility. Be cautious about adopting this type of option in the hope of saving costs by only awarding one marker. Remember staff will have strong expectations for receiving rises of around the same levels as on the current scales and a policy of lower percentage awards over more years will lead to your salary rates becoming less competitive.

The reality is that when assessing performance you often find that the circumstances and achievements vary so give yourself room to take account of factors such as the degree of success and surrounding circumstances. A structure such as option 2 is more suited to a motivational pay structure..

Upper Pay Range – the two year waiting period before the next pay rise was removed. The current promotion award from the Main to the first point on the Upper Pay Range is circa 8%. The pay range used to have three points of 4% each. Now, you are free to determine progression within the range. One option is to allow for an annual award rather than follow the current biennial award. That would require the creation of 3 markers of 2% each on the range between the minimum and maximum. The cost should be the same as now because each year’s rise will equate to 50% of what formerly would have been the two year increase. As with option 2 above, you may wish to award a lower or higher percentage to take account of the performance achievement.

Valuing the Learning Curve and Experienced Teachers

The options above are relatively safe as they are built around the current structure with added flexibility. Now we shall consider different approach. The current salary structure assumes even percentage rises at each point within the range but does that mask the nature of teaching. In the first few years, a teacher will probably undergo a steep learning curve but by year 3 or 4 they are likely to become fairly well rounded and adept at adjusting their teaching style to different groups and behaviours of groups/individuals.

As enthusiastic as new teachers are, the experience of a teacher, like other professionals, will be determined by the situations to which they have been exposed and how they learn from those situations and apply their skills to differing circumstances. Hence, is there a case that experienced all round teachers should be rewarded with a higher percentage rise from say year 3 or 4 onwards? Should those in the learning curve receive a lower percentage but with the flexibility to award more to those who are highly effective performers even if still in the learning curve?

I realise that lifelong learning is a fact for many but is there a case take a different approach and recognise the difference in skills and performance outcomes of those who have gone through the learning curve and now deliver effective outcomes? I imagine that some will say that they would prefer to motivate the ‘learners’ to reach maturity as quickly as practicable to produce effective outcomes for pupils. The key question here, which some leaders may not be comfortable with at this stage, is whether differentials in the level of the markers should be applied to the ‘learning curve’ and thus release some funds to pay more for the experienced teachers from say the 3rd or 4th Year onwards.

Linked to this is the more searching question – what difference do you expect in terms of performance from a teacher on the mid point compared to one on the maximum? Similarly, what difference do you expect in terms of UPR 1 compared to a UPR 3 teacher? If there are significant differences, should that result in higher percentage increases for those upon whom there are higher expectations?

In the first year of operating the new pay structure, you may feel more confident at keeping the pays structure close to the current pay ranges but the issue of affordability is likely to figure at some stage so be prepared to experiment with different approaches to reinforce performance.

Deciding an Individual’s Pay Rise

This is the point at which all the different elements come together but in some ways this should be a relatively easy decision in view of the evidence you should have to hand from the appraisal process and the flexibility that you have in your pay structure. Key points to bear in mind are:

• A zero pay rise is unlikely to drive out a poor performer. Poor performance will have to be managed directly via direct discussions and if necessary via the capability process.
• High performers are often lost because they feel undervalued. If you give say a 8% rise to effective performers and a 9% rise to high performers, the latter will see that as undervaluing their contribution as the differential is too small. Designing flexibility into your pay and recognition practices is important so that you can be creative in rewarding highly effective performers.
• Professional staff seek recognition – money is one factor but so are opportunities for true personal development. Be creative in ways of recognising staff – the value to a member of staff is often far more than the actual cost or time involved. You can read more about this aspect at http://personnel-advice.co.uk/wpeducation/?p=680
• Use the whole range of flexibility available to you which includes allowances such as the fixed term TLR3 which is not subject to safeguarding, recruitment and retention allowances which are not restricted to 3 years and so on. The differential between a TLR1 and 2 allowance no longer has to be £1,500 so you can adopt more flexibility.
• If you believe that an effective approach is by motivating staff to continue to improve their range of skills and therefore outcomes for students, then adopt a motivational stance when determining pay increases – encourage individuals to go the extra distance.

Performance related pay will create tensions in applying flexibility and being consistent. You will need to invest time in training your assessors of performance and of pay awards/recommendations to ensure that those are based on sound evidence and consistent application.

One way of encouraging consistency and ensuring expectations remain high is to hold a an annual evaluation session with the Senior Leadership Team. To achieve consistency in rating of top performers, you could ask the assessors of staff rated as highly effective performers to present their reasons to the SLT/Assessors so that a peer evaluation takes place to ensure that across the school a consistent view of highly effective is developed. This helps to check any softer or harder approaches in particular teams diluting the value of a highly effective award.

Appointing New Staff

Your pay structure and pay policy should give you the flexibility to pay new appointees a competitive salary and appropriate allowances.

The draft terms will enable a teacher to be appointed in a different school on the advertised grade and not retain the right to a lifetime UPR salary. What is not clear from the draft terms is whether such a teacher could accept a role on the main pay range, having previously been on UPR, and then apply for the Upper Pay Range again. The draft terms do not appear to have clarified this issue.

Pay Policy

In a later article we shall explain how to avoid the pitfalls of such policies and will produce a template for a pay policy. We shall also note some of the small print contained in the draft terms which may come as a surprise and discuss the additional flexibility available when using allowances from September.

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Sources

[1] School Teachers’ Review Body Twenty-First Report 2012 page 35; other data quoted is also sourced from the same report.

[Editor’s Note Nov 16 – link to illustration needs updating]

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