University of Arkansas at Little Rock
Policy Name: Extra Compensation from Sponsored Projects
Policy Number: LR 603.11
Effective Date: June 15, 2016
Revised Dates: –
Most Recent Review Date: –
Federal rules and regulations, including the Uniform Guidance (UG) 2 CFR §200, do not allow for an individual’s institutional base salary to be increased as a result of grant funding. These federal rules and regulations also restrict the payment of overload, bonus, or other supplemental payments outside the individual’s base salary. The following policy must be applied when a salary is to be paid from a sponsored project. Extra compensation above the base salary can only be charged to federal awards in unusual cases when specifically authorized by the awarding agency.
Rules and Regulations
Additional compensation is to be calculated on the same basis as any other activity conducted during the academic year. It must also be charged the appropriate fringe benefit rate. Generic terms, such as “salaries,” “overload,” “personnel services,” “stipend payments,” etc., may not be used as requests for additional compensation. Requests for additional compensation must be clearly labeled “extra compensation” in the budget of the proposal, or a budget adjustment must be approved in writing by the sponsor. ORSP reviews all requests for extra compensation in budget proposals and has the authority to disapprove them or request changes.
Extra compensation found to be improperly charged to sponsored programs accounts will require reimbursement to the funding agency. Responsibility for reimbursement will be determined by the vice chancellor for finance and administration.
UG §200.430 states that salary charges by faculty members during the academic year are allowable at the institutional base salary rate (IBSR). The IBSR is the annual compensation paid by UALR for an individual’s appointment, whether that time is spent on research, instruction, administration, or other activities. This rate excludes any income earned outside of UALR duties.
During the academic year (or for fiscal year employees) supplemental pay is only allowable if all of the following conditions are met:
- There is a consistent written definition of work covered by the institutional base salary which is specific enough to determine when work beyond that level has occurred. This may be described in appointment letters or other documentation.
- The supplemental amount is commensurate with the IBSR and the amount of additional work performed.
- The salary falls within the salary structure and pay range established by UALR.
Intra-institution consulting by faculty is considered an institutional obligation requiring no additional compensation. Where consultation involves a separate or remote operation and the work performed is in addition to one’s regular responsibilities, supplemental compensation is only allowable if the consulting arrangement is:
- Specifically provided for in the Federal award or approved in writing by the Federal awarding agency.
- Consistent with compensation paid for similar work in other UALR activities. In cases where the kinds of employees required for a sponsored project are not found in the other activities of UALR, compensation will be considered reasonable to the extent that it is comparable to that paid for similar work in the labor market in which the non-Federal entity competes for the kind of employees involved.
Summer Salary for Faculty
Charges for work performed by faculty members outside of the primary appointment contract period will be at a rate not in excess of the institutional base salary or in conflict with the State of Arkansas faculty summer compensation policy.
The PI must clearly identify extra compensation in the proposed budget, provide a written justification for the compensation based on the conditions stated in the OMB Uniform Guidance, and provide documentation of the sponsor’s approval to ORSP.
The department chair/business official must review and approve the extra compensation request.
ORSP reviews project policies and guidelines, ensures that the conditions for paying extra compensation on a federally sponsored program have been met, and approves/disapproves the transaction.
Source: Office of Research and Sponsored Programs
Approved By: Chancellor Joel E. Anderson, June 15, 2016
Custodian: Office of Research and Sponsored Programs