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Background:
The Qualified Economic Offer (QEO) law provides a method that school boards can use to limit teacher compensation costs. It was enacted in 1993 along with legislation that restricts the amount of revenue local school districts can raise. The law applies only to K-12 teachers.
Under the QEO law, school boards have two options for setting teacher pay and benefits:
School boards almost always choose the QEO methodology, which is recommended by the Wisconsin Association of School Boards. If teachers reject the QEO proposal, the school board can impose it, leaving teachers with no legal means to achieve resolution. Moreover, once wages and benefits have been set and a minimum
QEO is offered, teachers lack the bargaining leverage to effectively negotiate other compensation or education issues such as class size, professional development, or student discipline.
Actual practice shows that when districts impose a QEO, the stated increases do not show up in teacher paychecks. This is because (1) teacher salaries are a function of salary schedules, not only the QEO; and (2) many districts use “cast forward costing,” a process prescribed in the QEO law. This is how it works: Every year, as experienced teachers retire or move on, they are replaced by less experienced teachers with lower salaries and benefits. The district, however, advances these more expensive “ghost” teachers on the salary schedule in projecting costs for the next two-year contract.
By overstating its expenses for teacher salaries, the district gives the impression that it is spending more money on teacher salaries and benefits than it actually does. This means that under the QEO law, the district can claim to have met the QEO standard of 3.8 percent combined salary and benefit increases while actually providing less to individual teachers.
WEAC affiliates report that school districts’ use of “cast forward costing” or “ghost people” has resulted in large cost overestimates. This phenomenon is one reason that, since the QEO went into effect, Wisconsin teachers have averaged a 1.9 percent annual salary increase, well below the 3 percent inflation rate during this period.
The 1999-2001 state budget contained modifications to the QEO that do the following: no longer count the cost of educational attainment (lane movements) in a QEO; and revise the definition of "economic issues" under a QEO by deleting the current broad-based language. The law will now narrowly define economic issues considered under a QEO. These changes will be first effective for contracts that cover periods after June 30, 2001. WEAC supported these changes to the QEO law. Another bill, 1999 SB 166, was introduced to repeal the QEO. The bill received 33 cosponsors.
The Wisconsin Education Association Council supports repeal of the Qualified Economic Offer law.
The QEO harms the quality of public education:
Contact Bob Burke in the WEAC Government Relations Division at 800-362- 8034 ext. 254 or by e-mail at burkeb@weac.org with any reactions, comments or questions.
Posted June 6, 2000