A Problem of Remuneration Strategy in Education

We on the right understand, of course, the concept of paying a premium for quality executives and administrators, but there seems to be something of, well, an employer's vanity in paying our new, relatively young Education Commissioner Deborah Gist substantially more than her predecessor, who had logged nearly two decades in the position:

Rhode Island's new education commissioner Deborah Gist, and her bosses, the Board of Regents for Elementary and Secondary Education, have signed a three-year contract that takes effect nearly a month earlier than expected -- June 8 -- and will pay Gist about $20,000 more a year than departing Commissioner Peter McWalters now earns. ...

McWalters, 62, will step down June 30 after 17½ years, making him one of the longest serving education commissioners in the country. This year, he earns about $152,000, plus $31,500 in retirement benefits because he does not participate in the state pension system, for total compensation of $183,500.

Gist's contract will run from June 8, 2009 through June 7, 2012. For the first year of the contract, she will earn $190,000 in base salary, plus $13,870 for retirement, or a total of $203,870, an amount that was approved by the state Department of Administration.

It's the new bonus, though, that is really suggestive that something is conceptually awry among those with control over pay and negotiations:

Gist's six-page contract adds a new perk: a possible performance bonus, although the amount or the goals Gist would have to reach to receive one have not been ironed out.

"The Regents agree to actively pursue legislative or other authority to establish a 'pay for performance' pool of funds to offer additional salary to the Commissioner conditioned upon the outcome of her annual performance reviews," states the contract.

The Regents felt it was only fair to include a performance bonus since the concept is being considered for teachers, say education officials.

A newbie being paid so much more than a seasoned veteran ought to be expected to impress as a matter of her baseline performance. The reason to incorporate a bonus is to hedge against disappointment.