Tuesday, May 20, 2008

Summer Salary Shift

At Harvard (like most US institutions), Harvard pays us a "9-month" salary; we can earn 3 additional months "summer salary" by various means, including grants. For example, you can use NSF grants to pay up to two months summer salary (the 2 months is an NSF limitation -- the 3rd moth would have to come from somewhere else).

When I arrived at Harvard, I found it a little odd that the 9-month salary was distributed over the 12-month year, but the summer salary was all paid over the summer. What this meant is that if you took 3 months summer salary, say, you got paid almost 1/2 (well, 7/16, I think -- consider this a good word problem for your average high-schooler) of your annual salary over the 3-month summer. But I got used to it.

This summer it appears the practice is changing, with summer salary now being set to be distributed over the 12-month financial year. There is some nominal loss (for me and other faculty), in that the money we were going to get paid this summer will now be paid over the 2008-2009 academic year, costing us potential interest. I'm actually also concerned about what havoc this could eventually play with taxes, although with any luck there will be nothing significant. I suppose I'll get used to this as well, but I don't see it as a good thing.

Inside sources have suggested to me that this is part of a move to better keep up with compliance issues for federal grants, inspired by the fact that Yale is apparently currently under an unpleasant government microscope. A quick perusal of Google didn't shed any useful information on Yale's plight, and I'm not exactly sure why the change in practice would make a difference. Anyone with similar stories or insight is welcome to comment...

6 comments:

Paul said...

Is this just trying to avoid the problem that you can't be paid 100% on a grant and write other grant proposals at the same time? (Your 100% pay is not 100% of a 40-hour week but 100% of your working effort during that time.) By pro-rating the salary over the whole year are they saying that you are < 100% on grants in the summer?

Harry Lewis said...

There is also a new provision that you can't actually take 3 full months summer salary from federal sources; the maximum is an undisclosed amount less than that. This is, I believe, out of deference to federal auditors who were concerned that some professors were talking to students and even going to committee meetings during times they were supposedly 100% doing research.

Anonymous said...

More on the tax consequences: RopesGray.com

Anonymous said...

Summer salaries are always lower than most other salaries, mostly because they are temporary and more workers are willing to accept less for the summer.

Valeo Salary said...

You can also find the total salary shifts for the year on any profession along with a dynamic salary range for each job by visiting the JobNob site.

Anonymous said...

Sorry to happen upon this late... here at our university we recently had a meeting with our dean and the subject of the new NSF salary rules came up. The dean indicated they were very happy the rules have changed- and that they would no longer sign any proposals including summer salary that didn't also request academic year salary at a 1:1 ratio. The kicker is, the academic year salary would go into the dean's slush fund- it would not be distributed to the faculty member- as we already are granted "release" time from teaching if we are working on federal grants. I have to hand it to the administration- this is ingenious- they have found a way to capture more funds. Is anyone else experiencing a situation like this?