A survey and analysis of various fairness issues related to teacher evaluation and the pursuant legal challenges to placement on the Texas Teacher Career Ladder by the use of a statewide teacher appraisal system are presented in this report. Analysis of legal trends in Texas indicates that strict compliance has been required in situations where evaluation procedures are clearly identified in statutes and policies. Challenged decisions related to evaluation have been upheld in situations of school board attentiveness to evaluation requirements. Issues involving content rather than procedure, however, require a trained evaluator. Case analysis indicates that teachers are responsible to demonstrate the arbitrariness and bad faith of a district's career ladder selection process and decision. Appendices include lists of incentive programs by state, employee grievances, teaching standards, and guidelines to encourage student participation. (50 references) (LMI)