The promise of more flexibility to reward teachers has been mooted for several years but it looks as though 2013 will become the year of realisation. The School Teachers’ Review Body has recommended a number of flexible provisions but it remains to be seen what will appear in the 2013 edition of the School Teachers’ Pay and Conditions Document.

In preparation, we need to take a realistic view of to what extent we can use flexibility and avoid developing complex, unaffordable reward practices.  So let us review the pitfalls of flexible pay by learning.from other organisations and drawing out key principles for rewarding teachers.

Reward Schemes Have a Limited Shelf Life

Companies have used flexible pay for many years to encourage:

• higher performance,
• the development of new skills
• the application of those skills to address key challenges.

For example, faced with a major need to develop improved and new skills, reward structures with those aims were developed which would have a life of 3 – 5 years. At the end of that period, the objectives were achieved. Maintaining the same reward structure was no longer appropriate as the original objectives, underlying the design of the structure, had been realised.and would have led to higher costs,

Do not assume that a more flexible and performance related reward structure will continue to motivate staff and secure the outcomes you require indefinitely. Think through what you wish to achieve over the next say 2 – 3 year period.

Will your Performance Related Pay Practices Drive out the Best Performers?

Performance related pay is unlikely to drive out your poor performers but it may demotivate your best performers within a few years.

Poor performers seldom leave because they receive nil or low pay increases when performance related pay is introduced. You will still have to take direct action to try to improve their performance or remove them if such efforts prove ineffective.

The Review Body’s recommendations would allow a school to move individuals along the pay ranges much faster or slower.  For example, the Head Teacher may be able to award increases of say 150% or 75% of the pay reference points rather than only give a pre-determined rise as happens with the current scale points. The adoption of pay reference points in a salary scale should help Governing Bodies to set guidance in order to differentiate performance rewards and help with modelling the resulting pay costs.

It will also be easier for a Main Scale teacher to progress to the Upper Pay Scale as a simpler method is likely to be introduced.  More rapid progression on the UPS scale could be introduced i.e. performance increases in less that two years

Apply Flexibility Proportionately to Avoid Adverse Motivational Effects

Your best performers will be watching the percentage that they are awarded compared to the average performer. If the differential is small, that will cause discontent and your most talented teachers will feel devalued and seek another post. A two or three percent differential will not be motivating for the most talented. An objective distribution of the pay increase budget will become critical. Differentiating rewards will make budgeting more difficult but the issue should be addressed.

The proposals also envisage that the Upper Pay Scale may be extended or that individuals may be paid above UPS to encourage the most effective teachers to raise standards amongst other teachers. That will help to reward the best performing teachers but will also bring another strain upon the budget. It is likely that such a change would lead to the removal of the AST and Excellent Teacher scales.

Market Allowances

Difficulties in recruiting staff to more challenging schools were noted by the Review Body. No changes are proposed to the current four geographic pay zones. To encourage effective teachers to move to such schools, the Report suggests that recruitment and retention allowances should no longer be time limited as now. Heads need to think ahead though and ensure that such allowances have clauses attached that make it clear they to be treated as market allowances rather than fixed costs for evermore; this will help to phase out or terminate such ‘market related’ allowances as the recruitment situation changes.

Organisations are living entities and the needs change; some needs may only last for a set period.  Currently, Teaching and Learning Responsibility allowances are a more or less permanent fixed cost as their purpose is to recognise an on going responsibility required by the school.  Consequently, salary protection for up to three years will be triggered if a TLR is terminated due to changes in organisational needs.

The Review Body has recognised that the creation of temporary TLRs for a specific, time limited purpose would be a useful flexibility although the recommendation caps such allowances at £2,500. Such payments would be for a definite fixed term and would not attract salary safeguarding at the end. This will help in some situations. The Review body cites that 21% of primary and 44% of secondary teachers receive TLRs [1]. In the future, it will be interesting to see whether the number of:

• Fixed term allowances increases while ‘permanent’ allowances decrease or
• Temporary allowances increases without a fall in permanent allowances.

Let us hope that the future collections of such data capture the number of fixed term and permanent allowances.

New Appointees take the Salary Advertised

An interesting statement appears on page 54 of the Review Body’s report about there possibly being, “no obligation for schools when recruiting to match a teacher’s existing salary on either the main or the upper pay scales.” Whether that will provide an option to appoint UPS teachers on the Main Scale remains to be seen as this is a flexibility that would help to overcome specific issues with the current terms.

Simplification of the School Teachers’ Pay and Conditions Document

The technicality and length of the current document is stated to be a deterrent to maximising the current flexible pay provisions. It is rather ironic that the Review Body’s Report runs to 109 pages, is repetitious and at the end of the day is not very innovative in its recommendations for new pay practices.

Are You Ready to Measure Pay Practices and Pupils’ Achievements?

OFSTED expect Governing Bodies to demonstrate that they understand, set, monitor and review the strategic progress of the school in the achievements of pupils. The Review Body observes the important role that Governing Bodies will need to play in making use of pay flexibility to ensure that educational standards improve.  Put another way, value for money will need to be demonstrated in terms of pupils’ progress and achievements as Governing Bodies will have more freedom to target how they spend their pay bill to those ends.  How will Governors set and monitor this aspect of focusing pay on improving results?  We will publish an article on this shortly.

Will the DfE address the known issue that as time progresses, diminishing returns are received from performance related pay as the motivational effect of year in year out objective setting loses interest?  As noted earlier, more innovative ways of rewarding teachers need to be considered for the future.

It will be interesting to read what the Secretary of State accepts and the actual flexibility introduced by the 2013 edition of the School Teachers’ Pay and Conditions Document.

Do you want to find out what new flexible pay provisions are to be introduced and the practical implications of those?  If so, click the link in the left hand column of this page to be alerted to new articles.

Sources

[1] School Teachers’ Review Body Twenty-First Report 2012 page 58 – data cited from OME analysis of DfE School Workforce Census data (November 2010).

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