Schools would hire teachers, either on the open market or from a registry of certified teachers, depending on the terms of their contracts. Salaries would be set by the market, and schools might compete for good staff by providing incentives to prospective teachers, such as a good benefits package or training programs. Teachers could demand higher pay for difficult situations or heavy responsibilities, and schools could offer bonuses for high performance. New laws would be necessary in many states to authorize school boards to contract out for whole schools and to pay contractors on a per-pupil basis. Many states would also need new collective bargaining laws that allow individual schools to employ teachers and to hire on the basis of fit with the school's mission and instructional approach.
Contracting encourages innovation and diversity in public education.
It also promotes efficient use of limited public funds, by focusing money and decisions at the school level. Contracting can produce these results without abandoning public education's concern for fairness, equality of opportunity, and progress for the disadvantaged. Though it would create stressful changes in the lives of some administrators and union leaders, it would create new opportunities for parents and teachers alike. It would take time to make a transition. States might experiment with contracting, by establishing it first in big-city districts where there are few good schools and thousands of students in desperate need of a more effective alternative.