Purpose

To establish policies for supplemental compensation for faculty on standing appointments.

Guidelines

Academic Year Compensation:

A. Penn State policies allow the following faculty salary supplement:

  • Supplemental II:  During the academic year, faculty on a 36-week contract are eligible for, but not guaranteed, up to 20% extra compensation from all sources processed through Penn State. (PSU Policy HR06)
    Any exceptions must be recommended by the School Director and approved in advance by the Sr. Associate Dean.    

B. Course Buy-Outs: Penn State Harrisburg has set the cost for “buy-out” of 1 course (3 credit hours) in any semester at 12.5% of the faculty member’s base 36-week salary.  

  • All course buy-outs must be approved by the School Director. If the buy-out will be paid from a sponsored project, the requested buy-out must be approved prior to proposal submission.  The number of course buy-outs for each faculty member per semester will usually be limited, per consultation with the School Director and the Sr. Associate Dean. 
  • Anyone receiving a course release for any reason, including buy-out by a sponsored project, will not be eligible for Supp II extra compensation during the semester of that course release.  Any exceptions must be recommended by the School Director and approved in advance by the Sr. Associate Dean.

C. Grant/contract-related salary issues during the academic year.

  • U.S. federal grant ** policies state “Charges for work performed on sponsored agreements by faculty members during the academic year will be based on the individual faculty member’s regular compensation for the continuous period which, under the policy of the institution concerned, constitutes the basis of his salary…In no event will charges to sponsored agreements, irrespective of the basis of computation, exceed the proportionate share of the base salary for that period.”  (OMB Circular A-21 Basics):
  • The National Science Foundation (NSF) policies impose a more strict limit on grant-funded faculty salaries (NSF Grant Proposal Guide):
    • “NSF regards research as one of the normal functions of faculty members at institutions of higher education.  Compensation for time normally spent on research within the term of the appointment is deemed to be included within the faculty member’s regular organizational salary.” Thus, NSF will NOT pay for faculty “salary release” time (also termed “percent effort” at PSH) defined below. However, they may pay for course buy-out at PSH with appropriate justification.
    • “As a general policy, NSF limits salary compensation for senior project personnel to no more than two months of their regular salary in any one year. This limit includes salary compensation received from all NSF-funded grants.”  
  • Based on the federal policy in OMB-21A, Penn State Harrisburg faculty receiving federal** salary support (whether as course buy-outs or as “salary release” of  non-teaching time during the academic year) will not be eligible for Supp II extra compensation during that 36-week time period.
  • There are two ways for sponsors to purchase faculty time: course buy-outs (12.5 % salary for one 3-credit hour course buy-out per year as described above) and purchase of non-teaching research time (termed ”salary release” or “percent effort” at PSH). Thus, grant sponsors (but not NSF, see above) may also pay Penn State for non-teaching faculty time to ensure that that time/effort is directed toward the relevant grant project. For tenure-line faculty at Penn State Harrisburg, this purchase of academic year research time by the sponsor can be up to a maximum of 12.5% salary/semester or 25% /year. At Penn State Harrisburg, the distribution of College funds from this “salary release” for tenure-line faculty will be: Chancellor’s Office, 20%; School Director, 30%; discretionary fund for the faculty member for academic activities to be approved by the School Director, 50%.
  • Effort Certification: Penn State and federal mandates require all faculty to certify that their percent effort on all grants and other external projects matches the salary paid by the sponsor (see also Section C below).  At Penn State, there are multiple forms that are required by several institutional offices for those certifications, and it is the responsibility of the faculty member to ensure that their activities properly (and consistently) reflect the origin of their salary compensation.  In addition, grant Principal Investigators are expected to certify the match between source of compensation and percent effort for all personnel paid from their grant projects.

Summer Salary Supplements

A. Grant-related salary issues during the summer 

  • US Federal Grant Policies make several statements that pertain to summer compensation for 36-week faculty (OMB Circular A-21 Basics):
    • The statement on summer salary is in agreement with the Penn State policy (see below) of summer salary being set at a maximum of 12 weeks of base academic year salary, however with the following federal limitation:
    • “Time spent on departmental activities, [teaching], leave (vacation), writing proposals ## [including evenings and weekends], working on other projects, and similar activities is disallowed” and “we must ensure that the researcher is indeed working on that grant or contract with no plans for …conferences ## or other obligations which would prevent the researcher from fulfilling the 100% effort obligation” during federally funded time.  
  • Specific funding agencies may impose more restricted limits on summer compensation.  For example, the National Science Foundation (NSF) policies (NSF Grant Proposal Guide) limit their compensation to faculty to only 2 months per calendar year total on all NSF grants (see above).

B. Penn State policies allow the following faculty summer salary compensation:

  • Supplement I: Faculty who had been on a full-time 36-week contract during the preceding academic year are eligible for compensation for activities for 1-12 weeks beyond the 36-week contract period (HR06).   Currently at Penn State, the 12 week summer period extends from May 15-Aug. 14.  The maximum 12 week salary is 1/3 of the base 36-week salary (or proportionate amounts for fewer weeks or less than 100% of effort), and this maximum compensation includes all salary processed through Penn State for any activities including, but not limited to, sponsored research, teaching and administrative duties.  However, see also the limits on summer compensation from federal sponsors below.
  • As a consequence of the federal restrictions (above) and recent federal/auditor attention to this issue, Penn State (and other universities) now discourages faculty with federal grants from requesting full summer compensation (see attached).  

C. Penn State Harrisburg guidelines:

  • As stated above, sponsor-paid faculty salaries must match the faculty member’s effort on the sponsored project. That means that a) the sponsor’s payment for salary cannot pay for more time (as percent total academic or summer effort) than is expended on the project and b) the salary must be paid during the time period that the effort is expended. Moreover, if faculty effort on sponsored projects usually occurs both during parts of the academic year and during the summer, all grant salary cannot be applied only during the summer.  Rather, it should be distributed between summer and the academic year according to the relative degree of effort in these time periods. 
  • As a starting point, we recommend considering a 50/50 split of grant/contract salary between summer and academic year, then adjusting for a more precise estimate of relative percent effort during these different time periods.
  • Details of faculty summer compensation must be provided/certified on the attached form (Faculty Summer Salary Request Form) for any Penn State Harrisburg faculty member receiving summer compensation from/through all PSU sources.

D. Any rare exceptions to the Penn State Harrisburg policies must be recommended by the School Director and approved in advance by the Sr. Associate Dean.

Related Policies:

Penn State Policy HR80 Private Consulting Practice

Footnotes:

**  Federally sponsored projects include both those funded directly from federal agencies [ex. National Institutes of Health NIH), National Institute of Justice (NIJ), National Science Foundation (NSF), etc.] and those officially from non-federal sponsors (ex. State) that use federal “flow-through” funding.  Whether the latter is involved is sometimes not apparent until the formal contracting process.

## Unless specifically related to the sponsored project and allowed by the sponsor.

 

Approved: Academic Council, Spring 2014