Term Paper on "Public Administration the Merit Pay System"

Term Paper 19 pages (6250 words) Sources: 9

[EXCERPT] . . . .

Public Administration

The Merit Pay System

The initiative of merit pay seems very simple on the surface. If one pays high-performing employees more than low-performing ones, the high performers will remain and keep performing at a high level, while the low performers will leave or have inducement to get better. And it can function like that, if workers understand precisely what it takes to receive an elevated raise, if there are no other aspect but performance in pay assessments, if there are adequate finances to pay out considerable differences in raise quantities, and if supervisors have the confidence to be truthful, and stand up to emotional stress (Colter, 2003).

Employers have been attempting to connect performance evaluations to pay increases ever since the end of World War II. By assessing work then rewarding it financially, supervisors hope to encourage workers to work harder, work smarter, and stay at their jobs. Nonetheless, after a lot of years of use and a great deal of study, there is little hard substantiation that performance assessment programs bring out the preferred effects. Actually, linking performance evaluations to merit increases may be merely a waste of time (Gray, 2002).

Merit pay refers to the procedure of shaping worker compensation, base pay or bonuses, in part, on the foundation of how well each worker performs at work. The standard is straightforward, at least in theory. It makes sense to compensate more industrious workers for their augmented offerings to the company, in the interests of justice, but also with a look at attempting to keep the best workers in an organization. Merit pay, or pay for performance, can take quite a few basic shapes. First, yearly salary raises can be founded on some sort of appraisal of the workers output, however that might be calculated. Those assessed as better will get superior salary raises which continue over the years. The second technique of compensating better workers is to utilize a bonus program or system, where a very industrious worker will be given some sort of bonus payment, which is a one time, non-repeating event (What Is Merit Pay (Or Pay for Performance), 2011).

The third advance entails direct compensation for quantified production. In a factory location, for instance, a worker maybe paid a certain amount for the production of each ten items. Essentially, that's supposed to reward those that work quicker. Or, there's a commission arrangement, like one would find in real estate businesses. The more one sells, the more they get paid, and the pay for performance is in fact built into the total system. "In the direct compensation for quantified production, one nice thing is that the link between objectively determined production and pay or compensation is clearer, better defined and requires less judgment" (What Is Merit Pay (Or Pay for Performance), 2011).

Today more than eighty percent of corporations are opting for a performance pay system occasionally also referred to as pay-for-performance, variable pay and merit pay. Under a performance pay system, workers salaries are attuned to designate how well they do their jobs, as well as to better mirror the market value of their jobs. The dimension of the across-the-board raise may get lesser so that improved performers can be given more payment. In a lot of instances, it doesn't make sense to promise any set percentage raise at all. It's actually an entitlement system. Individuals shouldn't get a routine raise just for being at the company another year. Giving everybody the same increase sends a meaning to the inferior performers that they don't have to try hard because they'll still get their raise. It also says to the best people that they don't have to try too hard, since they will still get their raise. Under the performance pay system, the market worth of individual jobs is also a feature. There's a greater demand for technical and network workers, so they might merit a higher proportion rate to replicate labor market and contributions (Brown, 2009).

One area in which merit pay systems have become a very controversial issue is in that of the education system. Monetary incentives utilized to persuade teachers to center on advancing student achievement are called merit pay, or pay for performance. It is a controversial topic for educators, as it is frequently hard to precisely gauge achievement in the classroom. While merit pay is supposed to be granted to those teachers who teach well, it is most frequently given to those whose kids achieve well on standardized tests. Other labors, comprising extra work in planning curriculum, are unnoticed. Merit pay has had varied victory when simply taking into consideration increases in test scores. There have been cases where merit pay has been linked to superior test scores, but others in which the guarantee of merit pay has had no concrete force (Mooney, 2011).

"The NEA (National Education Association), which represents public school educators, is the largest labor union in the United States. This organization has strongly opposed merit pay. They dispute the system of merit pay would not treat all teachers fairly. The NEA believes merit pay has and would in the future unfairly reward teachers in the more affluent schools and would not accurately measure a teacher's worth to their students. The NEA is often in disagreement with politicians who support merit pay and seek to command it" (Mooney, 2011).

The objective of the merit pay system is to not only enhance child performance and achievements, but to present teachers occasions for augmented pay. "Already widely practiced in Asia, the United Kingdom and private schools, the merit pay system is now gaining momentum in United States public schools. President Barack Obama has already proclaimed his support of the merit pay system. The very first school system to test merit pay in America was the Cincinnati public school system. In 1999, Cincinnati ran a ten-school pilot program which utilized peer and administration assessments on class preparation and presentation precision, and with these assessments teachers were placed into five salary groups. While originally faced with resentment from the teacher union, the victory of the pilot persuaded the union members to adopt the program in 2000" (Wann, 2009).

The state of Florida, along with many other people running state education systems are under the impression that creating a merit pay system will fix education. What they don't appreciate, and probably never will, is that they are going to drive out quality teachers and discourage future students from going into the teaching profession. Teachers don't go into the profession to become millionaires, they go into it because of their need to help students and teach them how to become useful citizens. What Legislatures are telling teachers, students and parents is that our educational system is broken because of the teachers. But the educational system is not a one-stop business. It can teach students, but it can't manage how that information is reinforced at home (Merit pay isn't answer to educational problems, 2011).

Denver, Colorado has taken a more contentious approach to merit pay, and straightforwardly connects student scores to the teachers' salaries. The principals and teachers make an accord in the beginning of the year for student score attainments, and conclude at the end of the year if the objectives are met. Of course, connecting test scores to salaries incites a lot of complaints and arguments. In an attempt to pacify some of the issues, lawmakers developed less far-reaching programs. Austin, Texas's program rewards all teachers for school-wide increases in test scores; and the state of Iowa gives bonuses to all teachers in schools where students do well on standardized tests, with the largest bonuses going to the school's top rated teachers. These programs' regulations will then reduce the rivalry within teachers and increase teamwork since by aiding others advance performance they are in fact help themselves as well (Wann, 2009).

Teaching unions across the country are lessening their resistance to merit pay for teachers, and finding new ways to try out the idea. The matter is multifaceted. In fact it has been discussed for over forty years in the area of education. The National Education Association (NEA) obstinately contests merit pay, but there is thinking that it is an idea whose time has come (Lewis, 2011).

Over the years, teachers' unions have challenged efforts to introduce merit pay systems. Teachers' unions see these types of programs as an undoing of job security. They continue to be dedicated to defending hard-won salary plans that reward years of experience and teaching promise. They see substitute pay plans as unverified and unqualified to fairly judge which teachers should get increases. Proponents of merit pay plans think that the old pay systems are out-of-date and don't give teachers inducement to accomplish or reward good performance. Some new teachers who are at the bottom of the pay scale do dazzling work that frequently goes unrecognized. "In contrast, there are teachers at the top of the pay scale who have not changed their teaching methods in… READ MORE

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