Employee Reward Management

Drawing on your knowledge of research, good practice and evidence from Personnel Today articles by the austerity panel on PRP (published in June 2010); Michael Gove’s push for Performance pay for teachers (BBC May 2012) and the Teachers unions view point on PRP (published by Personnel today, May 2012); please critically evaluate the potential challenges that might be faced with the introduction of performance related pay for teachers in England.
The discussions should include following:
1. A critical analysis of the emerging tensions and potential challenges of putting this policy into practice. This should include a critical evaluation of theoretical perspectives and practical implications of the introduction and management of PRP in organizations (40%).
2. Consideration of an alternative reward scheme together with reasoned recommendations of how it can be realised in practice. It is expected that you would include discussions on the monitoring and evaluation of your recommendations in the short and longer term (60%).
The following outcomes will be fully or partially achieved:
• Analyse the relationship between the environment, strategy and systems of reward management and the use of contingent pay;
• Evaluate the criteria necessary for successful introduction of contingent pay.
• Explore the use of PRP and it potential problems in practice;
• Explore the conceptual apparatus and theoretical debates informing performance related pay;
• Design internally consistent performance pay that recognises labour market and equity constraints.
• Critically evaluate key issues in implementing and managing performance related pay schemes.
Performance-related pay for the public sector rejected by Personnel Today’s Austerity Panel
Thursday 17 June 2010 14:32
Personnel Today’s Austerity Panel has rejected calls for more performance-related pay in the public sector, warning it could lead to increased wage bills and will not improve productivity.
Earlier in the week, the Chartered Institute of Personnel and Development (CIPD) called on government to make greater use of performance-related pay and bonuses in the public sector to increase productivity and drive reform. The government will reveal its Emergency Budget next week (22 June), which is expected to include measures aimed at reducing the public sector wage bill.
But Graham White, HR director of Westminster Council, insisted “performance-related pay doesn’t work”. He said: “Even in the private sector, performance pay rarely delivers the expected outcomes. It sounds intuitive in principle and can look very exciting on paper but when put into practise it rarely delivers anything but increased costs with no increase in performance. The key drivers for increased productivity and output are fairness, achievement and recognition, and not money.
“Performance pay has not stood the test of time within the private sector and will fare no better in the public sector.” White warned performance-related pay would “distort” performance within the public sector, with staff working to meet set targets rather than improving customer service. “Performance-related pay in the public sector will further distort performance by compelling individuals to disproportionately deliver only certain aspects of their role,” he said.
Roger Seifert, professor of industrial relations and HR management at Wolverhampton Business School, said: “The CIPD is wrong to suggest that such schemes can contribute to a more efficient public sector.” He added: “The schemes are very hard to design and implement – how do you measure the performance of the individual teacher, nurse or soldier?”They tend to be opposed by staff themselves and are not enthusiastically embraced by managers. Most important, there is no evidence they improve performance, but there is evidence they are seen as unfair and cut across professional duties.”
Seifert suggested the best way to improve performance was to enable “long-term stable pay systems with clear promotion avenues, correct staffing levels and more accountable senior managers”.
Richard Crouch, head of HR and organisational development at Somerset County Council, warned performance-related pay could encourage “the pay bill to creep up” in the long-term and there would be “a substantial cost in administering and applying performance-related pay in the public sector to reduce its subjectivity” because government work would not be easy to measure.
Angela O’Connor, chief people officer at the National Police Improvement Agency, agreed, saying: “We don’t have the same incentive in the public sector, unless we can make public value more meaningful and quantifiable.”
She added: “How could we be confident that professional, in the public interest, decisions on cuts were being made if the person wielding the axe is incentivised to make the cuts?
“The CIPD has missed the point about why people work in the public sector – making a difference comes much higher up the list than earning a packet.”
Meanwhile, Dean Shoesmith, president of the Public Sector People Managers’ Association, said while creating a link between contribution and pay could be “useful”, it had to be developed at a local level. “Otherwise there’s a danger the scheme is too much of a one-size-fits-all solution and could be exposed to manipulation,” he said.
Online Source: (http://www.personneltoday.com/Articles/17/06/2010/55987/Performance-related-pay-for-the-public-sector-rejected-by-Personnel-Today39s-Austerity.htm)
Teaching union condemns performance-related pay proposals
Tuesday 01 May 2012 16:14
The National Union of Teachers (NUT) has described plans to pay teachers on results as “total nonsense”, following the release of a report by the House of Commons Education Committee that looked at methods of recruiting and retaining the best teachers.
The Education Committee’s report, “Great Teachers: attracting, training and retaining the best”, proposed a number of measures aimed at improving the quality of teacher staffing. These included giving sixth-formers the opportunity to “try out” teaching to determine their aptitude, as well as introducing stricter literacy and numeracy requirements for teaching staff and also ensuring that all teaching applicants are observed in the role before they are offered a place.
However, it was the report’s suggestion that teachers could be paid according to results that drew criticism from the NUT.
The report said: “There are, currently, huge differences in teacher performance in the UK; no longer should the weakest teachers be able to hide behind a rigid and unfair pay structure.
“We believe that performance-management systems should support and reward the strongest teachers, as well as make no excuses (or, worse, incentives to remain) for the weaker. Given the profound positive and negative impacts which teachers have on pupil performance, as demonstrated earlier in our report, we are concerned that the pay system continues to reward low-performers at the same levels as their more successful peers.
“We strongly recommend that the Department for Education seeks to quantify what scale of variation in teacher value added equates to in terms of children’s later prospects. We further recommend that the Department develops proposals (based on consultation and a close study of systems abroad) for a pay system which rewards those teachers who add the greatest value to pupil performance.”
In response, Christine Blower, NUT general secretary, said: “Payment by results is total nonsense. Children are not tins of beans and schools are not factory production lines. Successful schools rely on a collegiate approach and teamworking. Performance-related pay (PRP) is not only inappropriate but also divisive. Children and young people differ and class intakes differ from year to year making it impossible to measure progress in simplistic terms. PRP will create even more difficulties for schools facing the most challenges as teachers will realise that they will get no thanks for teaching their students but will get more money by going elsewhere.
“Teaching is becoming increasingly less attractive as a profession for graduates to choose to enter and for those already in it. Unless the Government addresses the issue of pay and pensions as well as a punishingly high workload and accountability system, no amount of ‘marketing’ will convince graduates that teaching is an attractive career.”
Online source: (http://www.personneltoday.com/Articles/01/05/2012/58514/teaching-union-condemns-performance-related-pay-proposals.htm)
Michael Gove pushes for performance pay for teachers
By Sean Coughlan BBC News education correspondent – 16 May 2012
Teachers’ pay in England and Wales could be linked to performance and set at different local levels, under proposals set out by the government. The Department for Education has submitted the suggestions to the independent pay review board. Education Secretary Michael Gove says he wants a system that can attract the highest quality teachers.
Teachers’ unions have already raised the prospect of industrial action against plans for regional pay. “Reform of the current pay system for teachers is fundamental to driving up teacher quality,” said Mr Gove.
He rejected the current system as “rigid, complex and difficult to navigate”.
The House of Commons education select committee recently called for a pay system that reflected the different contributions of school staff. “We are concerned that the pay system continues to reward low-performers at the same levels as their more successful peers,” MPs reported.
‘Local pay zones’
The Department for Education in Westminster submitted its proposals to the School Teachers’ Review Body (STRB), which makes recommendations on teachers’ pay for both England and Wales. The timetable for the proposed changes would see the STRB responding in the autumn – with the secretary of state announcing a decision next year, which could apply from September 2013.
Mr Gove says that the quality of teaching is fundamentally linked to school standards – and that the pay structure should be designed to attract and reward the best staff.
But the suggestion of deregulation pay brought a wave of condemnation from teachers’ unions, which say that it would be more likely to undermine than inspire teachers. “Teachers are already suffering from pay freezes, job losses and increases in pension contributions – they now face pay cuts due to a policy based on ideology not evidence,” said National Union of Teachers’ leader Christine Blower.
The NASUWT teachers’ union leader, Chris Keates, says the research evidence “demolishes the coalition government’s case for local and regional pay”.
The suggestions set out by the Department for Education are intended to create a stronger link between performance and reward. It suggests options that could range from complete deregulation – where schools could create their own pay systems – to limited flexibility, with maximum and minimum pay bands.
The intention would be to allow schools more flexibility in using their budgets to target particular needs – whether for teachers in shortage subjects or as an incentive to keep the most effective staff.
It also raises the idea of different pay in different areas – with “local pay zones”. Mary Bousted, leader of the ATL teachers’ union, questioned how an individual teachers’ contribution could be fairly assessed. She also highlighted a report earlier this week which argued that the international evidence did not show any clear link between performance-related pay for teachers and pupils’ test results.
Online Source: (http://www.bbc.co.uk/news/education-18089505)
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