Q May a school district provides incentive pay for bus drivers who have not missed any days driving a bus? This proposal would provide an incentive payment at the end of the year based on attendance. Also, would a similar program be allowed for teachers?

A It is permissible for a school board to adopt a policy to offer and pay certain incentive payments to its employees, provided that an incentive payment is contracted for prior to the date when services are to be performed, is determined in accordance with objective standards of measurement and is earned by personal services performed by the employee. This would apply to teachers as well as other employees. However, please note that performance-based incentive payments are excluded from “earned compensation” under Section 25-11-103(k) and should not be reported to PERS for retirement purposes. (Attorney General’s Opinion to Nettles, June 26, 2014)