Faculty Summer Salary on Grants

Background

Faculty who are not on a 12‑month base contract may receive compensation during off‑contract periods—most commonly as summer salary. To ensure compliance with federal regulations and to preserve our strong relationships with sponsors, it is important that any summer salary paid from sponsored project funds reflects work performed during the summer period.

Any summer salary funded from grants must be related to those project activities. Institutional responsibilities—such as course preparation, serving on governance or compliance committees, or preparing new competitive proposals—cannot be charged to sponsored funds. Federal audits have identified this as an area of risk, and institutions have faced significant cost disallowances and required repayments when faculty were compensated 100% from sponsored funds during a summer month but also took vacation or performed non-grant activities during that same period.

Federal regulations also require that compensation for work performed outside the academic year (i.e., summer salary) be charged at no more than the individual's institutional base salary rate.

This guidance will help faculty and staff navigate these rules with confidence.

Key Takeaways

• Faculty who are not on a 12-month contract may receive summer salary from sponsored projects at their institutional base rate.
• Faculty on 12-month contracts should use release time to fund their effort on sponsored projects.
• The rate used to calculate summer salary is the faculty member's most recent academic year salary (the salary rate in place as of May 15).
• Use HRS Earn Code E80 GNC (Grant No Fringe) when processing summer salary on sponsored funds.
• A summer month charged 100% to sponsored project(s) reflects effort solely on those project(s). This assumes that:
  • Any travel that month is directly related to the sponsored project(s).
  • No vacation will be taken during the month.
  • No institutional responsibilities are performed.
• It is not appropriate to charge salaries to grants for time spent on non-grant institutional activities and doing so presents significant financial and reputational risk for both the faculty member and the University.
• To allow space for non-grant institutional responsibilities and vacation, faculty should not receive more than 2.85 summer months (95% effort) of compensation from sponsored funds.
• Faculty seeking to receive summer salary of more than 2.85 summer months from sponsored projects must obtain prior approval due to the elevated compliance risk.
  • To obtain approval, complete the Faculty Summer Salary Exception Form before initiating any summer payroll.