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PAR System: Example of Percent of Pay Calculation With an NIH Salary Cap Differential
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Summary: The following example explains how the Personnel Activity Reporting (PAR) system calculates percent of pay when the NIH salary cap differential distorts the percentage, and what you need to do to correct it. |
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PAR system — example of percent of pay calculation with an NIH salary cap differential: During the summer 2000 period, an employee was paid for 50% of her time on an NIH federal fund (index DEF0000) and 50% on a non-federal fund (index QBC1234). Because of NIH salary cap restrictions, she was paid a supplemental amount from a third fund (index QBC0000) to offset the lower salary.
Her base salaries were different across funds and the PAR system ignores the supplemental salary. When certifying effort, the department needs to recognize these discrepancies and adjust the effort reporting accordingly. The following table shows how the PAR system calculates percent of pay:
|
Index |
Fund |
DOS code |
Pay month |
Time base |
Rate |
Gross salary |
| Sponsored projects: |
| DEF0000 |
33100A |
HST |
7/00 |
.50 |
5,000 |
2,500 |
| |
|
HST |
8/00 |
.50 |
5,000 |
2,500 |
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HST |
9/00 |
.50 |
5,000 |
2,500 |
| Total paid on DEF0000: |
7,500 |
| All other: |
| QBC1234 |
19900A |
REG |
7/00 |
.50 |
8,000 |
4,000 |
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REG |
8/00 |
.50 |
8,000 |
4,000 |
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REG |
9/00 |
.50 |
8,000 |
4,000 |
| Total paid on QBC1234: |
12,000 |
| QBC0000 |
19900A |
BYR |
7/00 |
0 |
1,500 |
1,500 |
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BYR |
8/00 |
0 |
1,500 |
1,500 |
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BYR |
9/00 |
0 |
1,500 |
1,500 |
| Total on QBC0000 salary differential: |
4,500 |
| Total paid summer 2000: |
24,000 |
The PAR system ignores the BYR DOS code. Total pay for this period is $19,500.
The percent of pay that will be reported on the PAR is 38% for sponsored projects (7,500 divided by 19,500).
The percent of pay that will be reported on the PAR is 62% for all other (12,000 divided by 19,500).
Because of the percentage distortion caused by differing base salaries and the supplemental salary, you need to overwrite the percent of pay as 50% for sponsored projects and 50% for all other on the PAR form.
If the employee worked on the NIH federal fund 50% of the time and on the non-federal fund 50% of the time, the department should certify the percent of effort as 50% and 50% respectively, not 38% and 62%.
Questions? Contact OPAFS.
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