The other problem with LIFO
Guest blogger Rebecca Sibilia is the director of fiscal strategy for StudentsFirst.
School leaders in cities, school districts, and states across the country continue to grapple with revenue shortfalls that often require teacher layoffs. Unfortunately, the impact of these layoffs is exacerbated when schools are required to use Last-In, First-Out (LIFO) policies, which require layoffs to be issued in the order of reverse seniority, because such rules mean more teachers, of all skill levels, will lose their jobs.
While the problems of quality-blind layoffs that force good teachers out of the classroom are obvious, the way these policies exacerbate the disruptive impact of teacher layoffs is also important. LIFO not only hurts students by firing newer teachers regardless of their performance, it also harms students and teachers by requiring that districts lay off a greater numbers of teachers than they would need to let go in a system that was based on performance.
A recent study in Education Next showed that only 16 percent of teachers laid-off under LIFO would also be laid-off in a system that uses performance, rather than seniority, as the deciding factor. Good teachers can be found at every level of experience. When districts make quality-based layoffs, we assume that an equal number of veteran and new teachers will be affected. Because teachers are typically paid based on their years of experience, this means that layoffs based on effectiveness will more likely produce savings closer to an average teacher salary, instead of a new teacher salary, which is usually significantly lower. As a result, fewer teachers would need to be laid off to achieve the same level of budget reductions.
Visual depiction reprinted from The New Teacher Project, “The Case Against Quality-Blind Teacher Layoffs” Philanthropy Roundtable 2011.
California’s revised budget, released this week, proposes a state-wide cut of $656.7 million from K-12 education funding above and beyond cuts districts had already planned for should voters not approve a tax increase this November. According to the National Center for Education Statistics (NCES), California teachers in their first five years of teaching make $47,313 compared to the statewide average salary of $69,783, a difference of $22,470. This difference means that 47.5 percent more teachers stand to lose their jobs under California’s LIFO requirements than if a quality-based layoff system was implemented. We estimated that based on the $656.7 million cut, California schools will be required to lay off 8,328 teachers, but if districts were allowed to make layoff decisions on the basis of quality, they could save as many as 2,682 teachers statewide, and avoid disrupting the educations of 80,000 students.
Just as California school districts may have to issue additional lay off notices, Pittsburgh, Pennsylvania needs to take steps to close a budget deficit of $21 million, caused by a rapid loss of state revenue and other compounding costs. However, unlike California, Pennsylvania state law requires LIFO policies unless the local school board and teacher union agree to a different layoff practice. The Pittsburgh School Board voted overwhelmingly in April to attempt to work with their local union to renegotiate the teacher’s contract to consider measures of effectiveness in future dismissals. According to the NCES, new teachers in Pennsylvania earn $43,098 per year compared to the average teacher salary of $57,567, a difference of $14,469. Because of this difference, Pittsburgh will have to lay off at least an estimated 33 percent more teachers if it is forced to retain its current LIFO policy. This would affect 1,417 more students than in a quality-based system.
Layoffs disrupt schools, students, and teachers no matter how they are implemented, but LIFO policies only exacerbate the situation by forcing many great teachers out of the classroom without regard to the quality of their work and disrupting the education of more students than needed.
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About the Editor
Bernard Lee Schwartz Policy Fellow
Chris Tessone was a Bernard Lee Schwartz Policy Fellow and the Director of Finance of the Thomas B. Fordham Institute. He has strong interests in governance and education finance, especially teacher compensation and school facilities finance.
May 16, 2013