Overtime Compensation On Contract And Grant Fund
PURPOSE
Federal regulations require that recipients of federal funds adhere to certain Cost Accounting Standards. Costs charged to federal funds must be allowable, allocable and consistently charged.
Charging overtime to federal funds for employees whose regular duties are related to and paid from state, university or other non contract and grant funds, is a violation of Cost Accounting Standards. For some federal agencies overtime is not an allowable cost under any circumstance.
GENERAL GUIDELINES/APPLICABLE POLICIES
The only allowable overtime charges to federal awards are for individuals whose regular salary and duties are related to and paid by that particular federal award. (See examples below).
Supervisors are responsible for identifying an allowable funding source prior to allowing the individual to work overtime.
Overtime payrolls that violate this policy will not be approved for payment until an allowable funding source is identified.
Examples:
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Janice is the project assistant for the federal grant A. Her duties and salary are related to and paid 100% from federal grant A. She works two hours overtime. Janice’s overtime would be an allowable charge to the federal grant if agency regulations allowed overtime.
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Tammy is an administrative secretary in the Bioengineering Department Her primary duties are related to and paid from state funds. Dr. Stevens has a grant from NASA. Dr. Stevens asks Tammy to work overtime to perform tasks for his grant. Tammy works overtime and the overtime payroll is submitted to charge the cost to the NASA grant. This is an unallowable cost to the federal grant. The employee has worked and must be paid. The cost will have to be paid from a non federal funding source.
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Sarah is working with Dr. Williams on two research grants. Her duties and salary are 75% on grant A & 25% on grant B.
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Sarah works overtime during the week. The duties are related to grants A & B. Allowable overtime cost should be prorated 75% grant A and 25% grant B.
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Dr. Williams wants Sarah to continue her regular duties for grants A & B and to work overtime to perform tasks related to federal grant C. The overtime cost would be an unallowable cost for grants A, B & C. The overtime will have to be paid from a non federal funding source.
