Summer Salary and Effort Reporting: Guidance for Summer Faculty Appointments on Sponsored Projects
- Research Administration
- Summer Salary and Effort Reporting Guidance
- Summer Salary and Effort Reporting: Guidance for Summer Faculty Appointments on Sponsored Projects
Background
Federal Uniform Guidance (UG) requires the University, as a recipient of federally sponsored funds, to assure our sponsors that charges for effort, associated salary and fringe benefit costs to the sponsored projects accurately reflect the work performed during the pay period, and that commitments to sponsors have been met. The University’s appointment and effort reporting policies ensure this responsibility from UG is fulfilled. Failure to comply with these policies and requirements can lead to financial penalties, expenditure disallowances, loss of funding, and harm to the University’s reputation.
The Effort and Compensation on Sponsored Projects Policy, CAM HR-24 was adopted by the University in 2015 to address compliance with UG requirements, however, interpretation of its requirements has varied widely creating financial and reputational risk for the University. The 2015 Policy required that a minimum of 5% effort be retained for non-sponsored activity during the duration of any appointment period for faculty. That 5% had to be paid from institutional funds. The challenges of compliance with this policy were faculty and/or units not having access to institutional funds to pay the 5% and conducting non-allowable activities during unpaid time was not recognized. The extent of inconsistency across campus as well as non-compliance with the Policy was not apparent until it came to light after the summer of 2019 when OVCRI reviewed summer salary data
In August of 2022, the Effort and Compensation Working Group was charged to clarify CAM HR-24 and to provide procedural guidance and directions to those processing faculty summer appointments including to consider how effort and compensation are handled at peer institutions and make recommendations for handling non-allowable activities conducted during the same pay period as sponsored project activities. In February of 2023, the working group made a formal recommendation to campus leadership; this recommendation was accepted; this recommendation was accepted and implemented.
Read the updated CAM policy HR-24 here. (https://cam.illinois.edu/policies/hr-24/)
Summer Salary Principles and Guidance
Principles
The bedrock principle underpinning the guidance is honest dealings with the federal government and compliance with Federal Uniform Guidance (UG).
Payroll records shall align with the period in which the work is performed.
Faculty members shall assess their expected non-allowable activity and work with HR and Business staff to adjust each summer appointment(s) (month) accordingly to ensure that only sponsored-project activities are charged to sponsored project funds.
Faculty regularly participate in activities that are not allowed to be conducted while being paid on sponsored funds (Non-Allowable Activities)
Guidelines
Reserve a minimum of 0.15 month (~3 days) out of 3.0 months across all summer pay periods for non-allowable activities. (The 0.15 month is a minimum and should not be assumed to be sufficient to accommodate an extensive amount of non-allowable activity.)
Allow a maximum of 2.85 months at 100% (2.85 FTE-mo) to be paid from sponsored funds across all summer months.
Faculty may elect to use their Institutional Funds (State, ICR, gift) to pay for the non-allowable activity time, but are not required to do so.
Follow existing summer exception process.
Resources: Employee Request for Exception to Limit on Summer Appointment: https://humanresources.illinois.edu/wp-content/uploads/2024/05/dataops-Acad-Summer-Exception-Form-.pdf-final-k-5.7.pdf
CAM Policy HR-82 Summer Academic Appointments for Other than Summer Session Teaching: https://cam.illinois.edu/policies/hr-82/
Important Takeaways and Bedrock Principles
It is important for both faculty members and unit staff to have a solid understanding of the complexities of summer appointments because of the financial and reputational implications for individual investigators as well as the institution as a whole. In cases where appointments are inappropriately structured, investigators may be required to reimburse the sponsor of their research project and the unit and university may incur penalties.
- Honest Dealings with the Federal Government - We have responsibility for stewardship of sponsored funds
- Our faculty and investigators are signing off to affirm that they worked the hours they were paid on the project in the period in which it was charged
- If payroll doesn’t accurately reflect effort, this is not truthful, and our certification is not accurate
- Faculty reputational risk
- Financial risk – other institutions have had to return millions to federal agencies
- Institutional reputational risk – audit findings are damaging and affect our ability to conduct business
Frequently Asked Questions
What is the difference with this new guidance?
While we continue to limit summer faculty appointments on externally sponsored projects to allow for non-allowable activity, the new guidance will allow for variable allotment of non-allowable activities time among the three summer months, maintaining a minimum threshold (.15 month over the summer). This means that a minimum of 0.15 month out of 3.0 months across all summer pay periods must be reserved for non-allowable activities. Also new is that there is no requirement that time for non-allowable activities be paid with non-sponsored funds (institutional funds). Faculty may elect to use their institutional funds (State, ICR or gift), but are not required to do this. This means that the new guidance recognizes that the portion of time reserved for non-allowable activities does not have to be paid from institutional funds.
In all instances, according to the UG and CAM HR-24, time charged to sponsored project funds in each summer month should be reflective of actual effort toward those projects in those months.
What about the 95/5 Rule? Is that still a thing?
The 95/5 rule applied to the labor distribution on an appointment. The 95/5 rule no longer applies under the new guidance. The 95/5 rule assumed that non-allowable activities were being carried out evenly over all appointment periods. Instead of the 95/5 rule, faculty will assess their expected non-allowable activities and adjust the summer appointment accordingly to ensure only sponsored-project activities are charged to sponsored project funds during each summer month.
Under the new guidance a maximum of 2.85 months may be charged to sponsored project funds over the three summer months with a minimum 0.15 month held as the minimum amount of time for the faculty member to engage in non-allowable activity over the three summer months.
Who is ultimately responsible for ensuring that work on sponsored funding is requested and performed?
The faculty member / principal investigator is ultimately responsible. They continue to be responsible for confirming that reporting on actual sponsored effort for their research team is accurate. Grants and HR contacts should work closely with faculty/PIs to ensure any reduction of proposed (budgeted) effort is approved by the sponsor and that the request is submitted in a timely and accurate manner.
What is the campus communication plan to faculty and the timing?
The Council of Deans were briefed on the new guidance in February and a DDDH message was sent in early March. DDDH recipients are encouraged to forward the DDDH message (including the link to this webpage) to faculty in their college who are expected to have summer salary.
What training will be available to faculty and staff?
Virtual training sessions and virtual office hours will be held during the month of March at various times. See the SCHEDULE section on this website for the list of events.
Does this policy apply to SIE (service in excess) requests or other non-summer appointments?
Yes, and the working group will be reviewing CAM HR-77 “Service in Excess of 100 Percent for Academic Employees”. In addition, the working group will discuss how CAM HR-24 applies to staff.
Who do we contact for questions or to make suggestions for FAQs to be added?
Susan Key, susankey@illinois.edu
Summer Appointment Scenarios
Faculty member requests to be paid 2 full months of summer salary, 100% from sponsored project funds. Is this allowed?
Yes, both months may be paid 100% on sponsored funding as long as the faculty member does not participate in any non-allowable activities or take vacation during this time. The remaining one summer month is when the faculty member may conduct non-allowable activities.
In the case above, would the third summer month have to be paid from the faculty member’s institutional funds?
No, there is no requirement that the third summer month be paid; however, should the faculty member have access to institutional funds s/he could pay themselves for all or part of the third summer month during the time when they are conducting non-allowable activities. Also, in this case, if payment of more than two summer months is requested, a summer exception request must be completed.
Faculty member has 2 months of summer salary funding from sponsored project funds and requests that s/he have a .66 FTE appointment for each of the three summer periods (May 16 – August 15) paid 100% from sponsored project funding. Is this allowed?
Yes, this is allowed provided that is when the effort on the project is expended. In this case because there is ample time each month that is not paid from sponsored project funding, the faculty member is free to engage in non-allowable activities across all three months of summer provided the paid effort toward the sponsored project funds is expended according to how and when it was charged.
Faculty member spent approximately one month during the academic year working on a sponsored project and asks if s/he can be paid by this project for one month in the summer to make up for this work. Is this allowed?
No, this is not permitted. It is required that payroll records align with the period in which the work is performed. If summer salary is being paid from sponsored project funding, the work must be done during that summer period.
Faculty member requests three full months of summer funding on a sponsored project. Is this allowed?
No. The faculty member may be paid for a maximum of 2.85 months on sponsored project funds. A minimum of 0.15 month must be reserved for conducting non-allowable activities. The faculty member should assess their expected non-allowable activities and work with their HR and Business/Grant staff to determine if the 0.15 month is sufficient time to cover all the non-allowable activities and when s/he expects to perform those activities. The 0.15 may be paid from the faculty member’s Institutional Funds (State, ICR or Gift). Also, since this would result in more than two months of summer salary, a summer exception request must be completed.