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Tennessee Teacher Compensation

Districts Partner with the State to Roll Out Reform

“This is doable.”

These brief words, shared by a Tennessee school district leader after a recent ERS-facilitated workshop on redesigning teacher compensation, seemed to signal an important shift. A few years ago, Tennessee school leaders faced an apparently huge hill to climb: redesigning their teacher compensation systems according to new state policies. But thanks to a collaborative partnership with the state, all 136 school districts are now in the midst of reshaping their policies. We believe the state’s approach has been key to driving this forward.

Tennessee is currently undertaking one of the most ambitious teacher compensation reforms in the country. State legislation passed in 2007 and updated in 2013 mandates that districts offer differentiated pay, which can include rewarding teachers differently based on their roles and ability to improve student outcomes. Fewer than a dozen states have implemented differentiated pay plans thus far1. In Tennessee, “differentiated pay” means more than “pay for test scores”—it can include anything from teaching in high-need areas, to taking on new leadership roles or bonuses for increased student performance. Now, every district must decide what differentiated pay looks like for them.

In support of Tennessee’s efforts, ERS has been partnering with the state to offer four monthly workshops and tools on compensation design to the 32 “Accelerated Planning” districts. Through the Teacher Compensation Workshop, exercises based on our “Value Proposition” paper, a round of School Budget Hold’em, and other supports, we’ve worked with districts to place compensation reform within their overarching human capital strategy, and identify fiscally sustainable compensation ideas that fit the total budget. Through this engagement, we have closely observed the well-rounded support provided by the state and been inspired by district leaders’ creative solutions to specific challenges. In our view, the state of Tennessee has played an important role in fostering such progress. So what are the key elements of their approach?

  • The “Right” Level of Flexibility: The state has struck a balance between statewide reform and local control by mandating differentiated play for all districts but creating flexible guidelines around design and implementation. This respects local autonomy and the different needs across districts.
  • In-Depth Technical Support: From planning and design modeling to communication and implementation, the state has provided the ample technical assistance to districts. A quarter of them (named Accelerated Planning Districts) received deep-dive, intensive sessions, while the rest have been supported with statewide planning sessions.
  • Addressing an “Imperfect” Evaluation System Head-on: Like many places around the country, Tennessee is still evolving its long-standing teacher evaluation system. One of the outstanding questions is how non-tested teachers’ pay will be determined. But by first acknowledging that this is not an easy question and laying out potential options, the state has kept the process moving forward.
  • Guidelines Based on Research and Practice: The salient elements of the state’s guidelines for the differentiated pay plan are informed by evidence-based research and practice. This is important in not only disseminating best practices but also in reducing implementation challenges. Examples include prioritizing high-needs positions for performance-based pay, not setting limits on the number of teachers rewarded with higher pay, and encouraging alternative salary schedules beyond the traditional step-and-lane system, which has proven to be ineffective2.

There are still important issues for the state and districts to resolve. For example, many districts still want to refine how they use the teacher evaluation systems that underpin their performance pay, and they need to find effective ways to implement differentiated pay in small or rural districts, many of which face capacity constraints and cultural challenges.

Nonetheless, the journey these 136 districts have taken with the collaborative, deliberate, and flexible support from the state offers a lot of optimism for success and is certainly a big step in the right direction.


1Susanna Loeb, Luke C. Miller, and Katharine O. Strunk. The State Role in Teacher Compensation. 2009.

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