Project Payroll Confirmation & Sponsor Salary Cap

The University of Kentucky utilizes a project-based payroll dollar confirmation process to validate that the payroll expenses are "reasonable in relation to the work performed" for the period reported.  This is completed by displaying in the Employee Compensation Compliance (ECC) interface the payroll dollars within a "project statement" for the specified period and replaces the traditional effort reporting.

Project statements must be pre reviewed and/or confirmed on a quarterly basis. Confirmation is only required on federal and federal flow through funds.  The quarterly review begins the 3^rd Tuesday after the close of the quarter (i.e. Jan – Mar payroll will begin pre-review in April).  Pre-Reviews performed by Primary Department Coordinators should be completed within 21 days of the start of the Pre Review period and prior to the start of the Confirmation period.  Principal Investigators should complete their confirmations within 29 days of the start of the Confirmation period. A project payroll calendar identifying important dates is updated and published on the Project Payroll site annually prior to the start of the next fiscal year.

At the start of the Pre Review or Confirmation period, the system will automatically generate emails to the Primary Department Coordinator for pre reviews and the Principal Investigator for related confirmations.

Project statements for the upcoming review period are held in the ‘In Progress’ status until the Pre Review period begins. The statements can and should be reviewed from the Department Dashboard for reconciliation purposes at any time leading to the start of the pre review, but no actions are allowed in the system until the review period begins.

New payroll is loaded to statements after every regular payroll run is completed (bi-weekly and monthly).  This update includes any revisions made via CDEM and/or Z4.  The project statements are independent of SAP and are unable to create payroll updates; payroll updates are only completed through CDEM and/or Z4.

All sponsored project statements, both federally and non-federally funded must be pre reviewed by the Primary Department Coordinator.

The Principal Investigator must confirm all federally funded sponsored projects. This includes both directly funded as well as federally funded flow-through projects.

All payroll expenses are loaded to the system which creates a project statement for any account with payroll activity. However, only sponsored projects require the pre review and, if required, confirmation process. Cost centers are not pre reviewed or confirmed, but the payroll information is available for reconciliation purposes.

Those designated as the Primary Department Coordinator (PDC) or Backup Primary Department Coordinator will log into ECC via myUK (instruction found in the QRC section).  Once logged into the web based interface, the user will identify the project statements requiring review (please refer to the Primary Department Coordinator Workflow) and identify the payroll dollars (direct and cost share) that were paid to each employee in the statement.  During the review, the statement will be pre reviewed or transitioned to “revision requested” status for additional updates if deemed necessary.

The direct charge and cost share percentages shown in a project statement is the percentage of total payroll dollars posted for the quarter to all cost center and/or WBS accounts.  This percentage is not tied to effort, because UK does not certify effort, but confirms payroll dollars charged to sponsored projects.  To identify all payroll postings, hover over the scroll icon to the far right of the payroll of the individual within the statement to show the breakdown of all payroll dollars posted for the quarter. 

The responsibility of the Primary Department Coordinator and Principal Investigator is to review the total payroll dollar amounts for all individuals posted to the selected sponsored project and validate their completeness and accuracy. 

The payroll % considers both base and non-base pay, and can fluctuate due to several items such as overtime payments, bonus payments, summer research payments, Wethington Awards, etc. 

The percentage seen within the project statement is calculated by taking the payroll dollars displayed in the statement and dividing that by the total payroll dollars received for all accounts in the quarter.

If someone is missing on the project statement, select the revise payroll checkbox for any person that is on the project statement to place the statement in Revision Requested Status (see QRC-Missing person on a Project Statement). Once revision requested is selected, work with all necessary department personnel to initiate the payroll changes in SAP.

It is possible that retroactive pay adjustments, new account statements for recently created WBS accounts, or similar changes could occur with regular payroll processing and post to the project statements automatically. It is important to remain in communication with the payroll specialist to ensure any adjustments that could impact a statement in “Pre Reviewed” status are identified.

The Pending Payroll Tasks tab appears on the homepage for the Primary Department Coordinator any time a request for a revision is made or payroll is loaded to a statement that is in revision requested status.

Pending payroll tasks are created when the project statement is either awaiting “Approval” or “Rejection” for a statement with at least one “Revise Payroll” button selected.  For statements with the revise payroll button selected, the PDC reviews the statement before accepting a change is needed or rejecting the request, and returning the statement to its prior status.

If the statement is on the Pending Payroll Tasks tab, simply "Reject" the request for revision and the statement will return to the original status it was in at the time of the request.  If the revision request was "Accepted" and no longer on the Pending Payroll Tasks tab, contact Research Financial Services to have the statement reopened and returned to the workflow. Please email ecrt.help@uky.edu for any of these requests.

It is important to work closely with the Principal Investigators regarding all payroll changes that are completed, as the system will not notify the Principal Investigator of any changes made during pre review. The payroll adjustments are available to be viewed in the transaction log of the project statement at any time.

The Statements Awaiting Confirmation tab lists all project statements that are ready for confirmation. Only Principal Investigators will have project statements listed on this tab.

Yes, when the Principal Investigator (PI) selects revise payroll for a specific employee, they have the option of adjusting the percentage for that employee.  This cannot be completed without selecting the revise payroll button for the employee.  Once selected, the statement will return to the dashboard of the PDC as a pending payroll task, and they will follow the previously described processing steps to move the statement forward.  More detailed training materials can be found in the User Guide and QRC sections above.

An individual’s posted payroll may show $0 on a project statement.  This can occur if the individual was erroneously added to the project and later removed.  For audit purposes, the system will not remove this person from the statement completely and will show the $0.  The Principal Investigator will still need to confirm that the $0 of payroll is accurate and that the individual should not have payroll expenses posted to the grant.

There will be times when a Principal Investigator is unable to complete the confirmation of project statements for the period.  If the PI is off campus, but has internet access, they can access the project statements by logging into myUK and navigating to their statements as they normally do.  If the PI is not available and cannot complete their review and confirmation, a designee can be assigned to the statement for the period being reviewed.  To complete a designee request, please email Research Financial Services at ecrt.help@uky.edu with the name of the person who will be the designee and how long they will be in this role.  For all other inquiries related to a PI being unavailable, please contact ecrt.help@uky.edu.

Please email ecrt.help@uky.edu to notify Research Financial Services of the situation. RFS will evaluate the situation and work with the Primary Department Coordinator to resolve.

No.  The salary cap amounts are legislatively-mandated annually, with active awards being subject to the cap in effect at the time. 

Salary amounts over the cap are considered unallowable expenses and as such, cannot be direct-charged to the sponsor and are not considered cost share; however, they must remain tied to the project and the cost share fund is used to tie the expenses to the project.

Benefit expenses are generally excluded from the calculation because benefit expense amounts are allocated based on the salary percentage.

The salary cap applies to anyone charging payroll to the project, regardless of FTE.

No, the salary cap is a restriction on the amount that can be direct-charged to the sponsor.  If not direct-charging payroll to the project, then no salary cap applies.

Yes, all salary direct charged, regardless of type, is subject to the salary cap requirements.

Compliance with salary cap requirements is the responsibility of the department.  However, a quarterly review of all individuals whose salaries are over the cap and are direct-charging an applicable grant is completed by RFS.  If attention is required on a project, a notification is sent to the department to initiate corrections.  This review and these corrections are designed to coincide with the earliest retroactive payroll dates, allowing for revisions to be made through CDEM.  A final review is performed by RFS at the close-out of the grant to ensure compliance.   

The DHHS salary cap is a rate of pay limitation that is legislatively-mandated by the Federal government, specifically limiting the maximum amount of salary an individual can charge to a DHHS award.

Compliance with the salary cap restrictions is mandatory to demonstrate diligent oversight and appropriate management of federal funds. 

Current guidance under a Continuing Resolution can be found at: FY24 Continuing Resolution

Subsequent publishing of the actual DHHS Appropriation for FY 2024 can be found at: FY24 DHHS Appropriation

DHHS Historical Salary Cap Limits

Please refer to the DHHS Salary Cap section above that has templates to assist with the calculation of the necessary salary cap adjustments.  

Cost-reimbursement grants, contracts and cooperative agreement awards are subject to the salary cap.

DHHS grants are denoted in SAP on the Reference tab in GMGRANTD with a CFDA Number 93.XXX series. 

The DOJ salary cap is a rate of pay limitation that is legislatively-mandated by the Federal government, specifically limiting the maximum amount of salary an individual can charge to a DOJ award with an award amount greater than $250,000.  This includes sub-awards with smaller award amounts if the Prime award is greater than $250,000.  The allowable amount to be charged to an award is equal to the percentage of time worked on the grant times the maximum salary limit (110% of SES salary). 

Compliance with the salary cap restrictions is mandatory to demonstrate diligent oversight and appropriate management of federal funds.

Current guidance on DOJ Salary Cap can be found here: DOJ Summary (Updated 2023)

DOJ Salary cap is calculated as 110% of the current DHHS Salary Cap.  Here is a link to the DHHS Salary Cap:  DHHS Salary Cap Historical Rates

Please use the DOJ Salary Cap Template linked above to calculate. 

Cost-reimbursement grants, contracts and cooperative agreement awards are subject to the salary cap.

DOJ grants are denoted in SAP on the Reference tab in GMGRANTD with a CFDA Number 16.XXX series.