University of Arkansas at Little Rock
Policy Name: Allowability of Career Service Recognition Payments on Sponsored Projects
Policy Number: LR 603.14
Effective Date: June 27, 2016
Revised Dates: –
Most Recent Review Date: –
Career service recognition payments, as established and regulated by the State of Arkansas and the University of Arkansas at Little Rock, supplement at a fixed and universal rate the annual salary of a classified or non-faculty employee who has worked for the state for ten (10) or more years. These payments should be considered fringe benefits that are a part of the employee’s institutional base salary rate and are thus, generally, allowable charges on a sponsored fund, according to OMB Uniform Guidance 2 CFR 200.431(c).
To be charged to a sponsored fund, whether federal or non-federal, the career service recognition payment must be budgeted for explicitly in the agreed-upon budget. Additionally, if the sponsor’s regulations disallow the payment for any reason, it will be considered an unallowable use of sponsored funds and must be charged to university funds instead. The career service recognition payment is consistently applied to all funding sources and allocated based on proportional benefit.
All state employees with ten or more years of state service receive an annual career service recognition payment at a standard rate. According to State of Arkansas Policy 20.16 (Career Service Recognition Payments), career service recognition payments are taxed and are included by retirement systems in determining benefits. Additionally, University of Arkansas at Little Rock Policy LR 402.3 (Career Service Recognition Payments) establishes further requirements for this payment.
Federal Policy Statement
OMB 2 CFR 200.431(c): The cost of fringe benefits in the form of employer contributions or expenses for social security; employee life, health, unemployment, and worker’s compensation insurance (except as indicated in § 200.447 Insurance and indemnification); pension plan costs (see paragraph (i) of this section); and other similar benefits are allowable, provided such benefits are granted under established written policies. Such benefits must be allocated to Federal awards and all other activities in a manner consistent with the pattern of benefits attributable to the individuals or group(s) of employees whose salaries and wages are chargeable to such Federal awards and other activities, and charged as direct or indirect costs in accordance with the non-Federal entity’s accounting practices.
Source: Office of Research and Sponsored Programs
Approved By: Chancellor Joel E. Anderson, June 27, 2016
Custodian: Office of Research and Sponsored Programs