Pay‐for‐performance in Estonian general educational schools: the situation for further development

Purpose – The purpose of this paper is to analyse the situation of performance management, to be more precise, the usage and attitudes towards pay‐for‐performance on the example of Estonian schools and brings out practical implications for implementing pay‐for‐performance in Estonian general educational schools. Design/methodology/approach – Altogether 298 headmasters and 2,165 teachers participated in this research. The goal of the research was to map the situation of the usage of pay‐for‐performance in Estonian schools and to find out teachers' and headmasters' opinions about the most effective pay‐for‐performance system. Findings – Despite the great expectations of performance management and pay‐for‐performance, it is not being used in many Estonian general educational schools. However, the findings of this research show that both headmasters and teachers have quite positive attitudes towards pay‐for‐performance that gives a favourable platform for implementing pay‐for‐performance in the Estonian educational sector. Research limitations/implications – The study was mainly quantitative with only a few open questions, which raises limitations for finding complete answers and explanations to questions raised. Therefore, case studies need to be done to find answers to some interesting research questions. Originality/value – With the view to raising the performance of the Estonian educational system and to guarantee its sustainability, a new course concerning schools' and pupils' individual development must be taken. It can be achieved through performance management and pay‐for‐performance, which also helps to raise teachers' motivation. A central feature of the pay‐for‐performance is that pay must be in accord with performance and must provide an incentive to promote the success of the organisation.