Implementing merit pay for teachers has been a contentious issue, particularly in the United States. Supporters contend that merit pay motivates teachers to do a better job, leading to better outcomes for students in terms of academic achievement and eventual employment success.
Critics, on the other hand, contend that the ways in which teacher performance is evaluated can lack transparency and may be beyond teachers’ direct control.
Selecting key performance indicators for teachers can be particularly challenging given that teachers can be evaluated based on their own behavior or on the behavior of their students and that student behavior can be influenced by many factors other than the teachers’ classroom performance. That is, teachers may exert some degree of influence over students’ behavior, including test scores, but students also arrive in a classroom with their own personal histories and unique circumstances that may affect how receptive and prepared to learn they are. Some critics argue that it can be unethical to base a substantial portion of teachers’ take-home pay on their students’ performance, particularly if performance is defined based on their students’ success on standardized tests.
In the United States, the push for pay-for-performance programs in educational settings gained traction in the 1980s and early 1990s. At about that time, a statistician named William Sanders began advising Tennessee lawmakers on a method for evaluating teachers based on the extent to which they improved their students’ standardized test scores, referred to as the value-added approach. The value-added approach takes into account the historical trends in students’ test scores, such as whether they improved, stayed the same, or declined, and determines whether a teacher improved their students’ test scores more than would be expected given that history.
Critics argue that the value-added approach is unfair, as a number of factors outside of teachers’ direct control can affect their value-added scores.
Moreover, some teachers teach subjects that do not have an associated standardized test, which can make it difficult to evaluate them in the same manner as their peers. Analytical software companies like SAS Institute have developed algorithms to calculate the value-added scores of teachers.
Some teachers and administrators have complained that these algorithms are difficult for nonstatisticians to understand, and due to the often proprietary nature of the algorithms, there can be a lack of transparency when it comes to communicating how the value-added scores are computed.
Supporters of the value-added approach point to evidence that students of high value-added teachers are more likely to attend college and to go on to earn higher salaries than other students.
In terms of empirical research on the topics, research has shown that incentivizing teachers with merit pay does not always lead to higher teacher motivation or better student outcomes. In fact, the empirical findings are mixed. Some evidence indicates that merit pay leads to higher student scores in math, science, and reading, whereas other evidence suggests that merit pay may have some effect on students’ math scores but not on reading scores and that teachers do not find merit-pay programs to be motivating.
As a way forward, some education reform advocates contend that rewarding teacher performance should not necessarily be thrown out; rather, the structure and organization of the schools themselves should also be taken into consideration when recognizing teacher performance.

Questions 

1. Given the risk that low-performing teachers may do a poor job of preparing their students for eventual career success, do you think it is ethical to pay teachers without taking into account their performance?
Why or why not?
2. Do you think it is ethical to base teacher pay on key performance indicators that may be, to some extent, beyond teacher control? Why or why not? Give some examples to support your opinion.