Pay for Performance in the States

Abstract

This research examines pay performance systems in the American states to determine the nature of policy diffusion and implementation patterns. Given the well-documented difficulties with pay for performance in the federal government and, increasingly, in the private sector, the research asks, Why do state governments continue to adopt the programs? The author's survey of those states with current pay for performance legislation or provisions finds that not all states with programs on the books have operational systems, nor do those with operational programs fund them consistently. A majority of personnel directors finds the systems to be somewhat effective, or as in improving manager-employee communication and overall direction of employees, but implementation problems occurred in nearly every state in the survey. Further, there was a significant gap between initial expectations for pay for performance and the reality of the programs. The author suggests that for future policy expansion and diffusion a set of decision criteria more closely linking policy expectations with personnel system's capability and support is necessary.

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