UMCP Guidelines on Overloads Involving Federal or Federal Flow-through Funds (Federal Funds)
Compensation, including overload payments, for personnel paid on federal or federal flow-through funds is governed by The Uniform Guidance (2 CRF 200). Recent audits by the federal government have resulted in disallowances of substantial sums of money at several institutions. The relevant section in §200.430 Compensation—personal services is (h)(2) through (h)(4)and reads:
(2) Salary basis. Charges for work performed on Federal awards by faculty members during the academic year are allowable at the Institutional Base Salary (IBS) rate. Except as noted in paragraph (h)(1)(ii) of this section, in no event will charges to Federal awards, irrespective of the basis of computation, exceed the proportionate share of the IBS for that period. This principle applies to all members of faculty at an institution. IBS is defined as the annual compensation paid by an IHE for an individual's appointment, whether that individual's time is spent on research, instruction, administration, or other activities. IBS excludes any income that an individual earns outside of duties performed for the IHE. Unless there is prior approval by the Federal awarding agency, charges of a faculty member's salary to a Federal award must not exceed the proportionate share of the IBS for the period during which the faculty member worked on the award.
(3) Intra-Institution of Higher Education (IHE) consulting by faculty is assumed to be undertaken as an IHE obligation requiring no compensation in addition to IBS. However, in unusual cases where consultation is across departmental lines or involves a separate or remote operation, and the work performed by the faculty member is in addition to his or her regular responsibilities, any charges for such work representing additional compensation above IBS are allowable provided that such consulting arrangements are specifically provided for in the Federal award or approved in writing by the Federal awarding agency.
(4) Extra Service Pay normally represents overload compensation, subject to institutional compensation policies for services above and beyond IBS. Where extra service pay is a result of Intra-IHE consulting, it is subject to the same requirements of paragraph (b) above. It is allowable if all of the following conditions are met:
(i) The non-Federal entity establishes consistent written policies which apply uniformly to all faculty members, not just those working on Federal awards.
(ii) The non-Federal entity establishes a consistent written definition of work covered by IBS which is specific enough to determine conclusively when work beyond that level has occurred. This may be described in appointment letters or other documentations.
(iii) The supplementation amount paid is commensurate with the IBS rate of pay and the amount of additional work performed. See paragraph (h)(2) of this section.
(iv) The salaries, as supplemented, fall within the salary structure and pay ranges established by and documented in writing or otherwise applicable to the non-Federal entity.
(v) The total salaries charged to Federal awards including extra service pay are subject to the Standards of Documentation as described in paragraph (i) of this section.
Accordingly, overload payments are never allowed where federal funds are involved without specific sponsor approval.
An employee’s appointment letter or contract should clearly state all of his/her responsibilities.
Steps for processing overload requests on federal/federal flow through sponsored accounts:
- It is the responsibility of the department requesting the overload to obtain approval from the program official at the sponsoring agency. The program officer’s approval should then be sent to the Office of Research Administration (ORA), along with a letter signed by the responsible departmental official certifying all points in 3. below. ORA will submit the official institutional request to the administrative official of the sponsoring agency who will provide the University with the official approval or rejection.
- Department/College must certify in the ARS that the overload assignment is outside of the appointment expectations as contained in the individual’s appointment letter or contract.
- Department/College must provide certification that the overload assignment will be arranged at times that don’t interfere with his/her regular duties; that the arrangement has the permission of his/her supervisor, that the individual’s tasks and schedule will be arranged such that his/her overload assignment will not negatively impact the work or schedule of deliverables supported by the sponsoring agency or agencies.