HHS Salary Limitations
The Consolidated Appropriations Action, 2012 (Public Law 112-74), signed into law on December 23, 2011, changed the salary limitation on NIH Grants and other extramural mechanisms to Executive Level II. This change is effective with grant awards with an Initial Issue Date on/after 12/23/2011. Effective January 8, 2017, Executive Level II was increased from $185,100 to $187,000. HHS funds may not be used to pay an individual at a rate in excess of the applicable salary cap.
Proposal budgets, whether detailed or modular, should be prepared using the individual’s actual UM base rate. See https://grants.nih.gov/grants/how-to-apply-application-guide/format-and-write/develop-your-budget.htm, Detailed Budget: Personnel, 2nd bullet. The sponsor may reduce the award if a salary request is in excess of the cap.
Regardless of whether the sponsor reduces the award, salary cannot exceed the current allowable rate of pay for Executive Level II:
- Fiscal year (FY) appointment - 12 months: $187,000 ($15,583/month)
- Academic year (AY) appointment - 9 months: $140,250 (9 months@$15,583, no summer salary)
- AY plus summer salary (an average of 72 days): AY base cannot exceed $135,610 in order to remain under the HHS cap.
- Summer salary for AY faculty is based on a daily rate (AY base/190=daily rate) multiplied by the number of work days in the summer; thus, attention must be paid to the number of work days per summer months to avoid exceeding the monthly limit.
In a nutshell, monthly payment of $15,583 or less will be compliant with the Executive Level II salary limitation, which extends to most HHS agencies. If clarification is necessary, contact specfic agency.
An individual's base salary, per se, is NOT constrained by the legislative provision for a limitation of salary. An institution may pay an individual's salary amount in excess of the salary cap with non-federal funds. The rate limitation simply limits the amount that may be awarded and charged to HHS extramural funds, and applies to subawards/subcontracts for substantive work.