Bernie Lunzer, TNG-CWA President

23 Sep 2010

Discretionary pay has been a perennial issue for organized labor and is currently part of the assault on teachers’ unions. Recently, the media watchdog group Fairness and Accuracy in Reporting published a worthwhile article, “First, Bash the Teachers,” that examined how even well-meaning reformers buy into the “merit pay” myth. To quote from that story:

Take “merit pay,” which would mostly use test score data to identify effective teachers and pay them more for their success—a “no-brainer,” according to Newsweek (3/15/10). As Diane Ravitch recounts in her recent book “The Death and Life of the Great American School System: How Testing and Choice Are Undermining Education,” much research suggests that teachers judged excellent or effective one year often fall out of the category the next, and vice versa. Either the teachers themselves are practicing wildly different methods from year to year, or the attempts to link test scores to teacher performance are not actually a “no-brainer” at all, no matter what the media might think.

The FAIR article goes on to explain that the American Federation of Teachers and the National Education Association have not opposed discretionary pay, but have had strong feelings about how it has been used—in part because most of its rewards flow to “teachers in upper-income schools.”

The Guild has had its own lengthy history with discretionary pay. When we were founded, it was understood that organizing journalists meant accepting some discretionary pay, especially for retention of well-known columnists and other writers. The Guild chose to bargain “minimums” instead of “scales.” That means employers were required to pay at least the minimum stated in the contract, but also could pay above that rate. For many years there was no great prevalence of discretionary pay, but there was always some.

The FAIR article points out it has become accepted that discretionary pay works. Nothing in my experience shows that to be the case. My home local had a very interesting comparison, The St. Paul Pioneer Press and the Minneapolis-based Star Tribune. For years, the scales for reporters and copy editors in the two towns were comparable, but then the Strib started awarding discretionary pay in the early ’80s, with two-thirds of the bargaining unit receiving it and one-third getting a substantial amount. St. Paul had no such practice—but what it did have was good esprit de corps and a couple of Pulitzer Prizes to boot. And while the Star Tribune remained a strong competitor, there was no evidence that discretionary pay made any difference.

Merit data could be reviewed at the local office, but the local had a clear policy that you could not copy or distribute it. We also issued broad analyses of the data based on ethnicity, age and gender. But when one member purloined the specific data and distributed it to every desk, all hell broke loose. As with most such schemes, there were no objective criteria—just subjective determinations. Management sputtered in defensive response, then promised to erect a legitimate review process—which started, then stopped. More recently, the unit chose to drive some of this discretionary money into bonuses so that the longer-term, fundamental unfairness of the system would be alleviated.

More importantly, the Guild’s regular analysis and review led to a gender discrimination suit. As a result the company was forced to make some changes, but the payouts are still discretionary and opinions vary about the fairness of the settlement and the underlying system of discretionary pay.

What troubles me most about discretionary pay—and teachers provide an excellent example of this—is that it is tied to standards that are well beyond any individual’s control or influence. For teachers, it all comes down to test scores that have more to do with the quality of the students in a given year than what the teacher does. That’s also the case for Guild-represented salespeople and circulation folk, who for years have been held responsible for a drop in sales related to the economy, or for carrier performances that they can’t control.

All this has led to the worst permutation of the discretionary pay issue: performance-based discipline. Not only are employers setting goals for their employees that are unattainable, but when those goals inevitably are missed they then inflict discipline up to and including termination.

Let’s speak the truth about discretionary pay and performance-based discipline: these are whips for lazy supervisors who can’t or won’t focus on the real problems their employees encounter. Both are in the most part fundamentally unfair.
We need managers who understand the work they supervise and understand how to manage people under their control. Simplistic pay and discipline systems destroy workplaces. We should not assume either will be used fairly.