NIH Increases Salary Cap – Important Information & Webinar Opportunity

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BY TIM TSCHIRHART – MAR 5, 2014 5:39:36 PM

NIH Increase Salary CapTim-Tschirhart-Photo

The National Institute for Health (NIH) recently announced an increase in the salary cap for Principle Investigators from $179,700 to $181,500. The increase, effective January 12, 2014, applies to all NIH grants, cooperative agreement awards, and extramural research and development contract awards.

Below is a summary of the NIH Salary Caps* for the most recent 3 government fiscal years and the applicable periods:


GFY 2014 Awards Issued:   October 1, 2013 through January 11, 2014
January 12, 2014 through September 30, 2014
GFY 2013 Awards Issued:   October 1, 2012 through September 30, 2013 $179,700
GFY 2012 Awards Issued:   October 1, 2011 through December 22, 2011
December 23, 2011 through Sept 30, 2012

*: The salary cap is exclusive of fringe benefits and facilities and administrative (F&A) expenses.

In their announcement, NIH stated that an individual’s actual salary is not constrained by this cap. The cap simply limits the amount that may be awarded and charged to NIH grants and contracts. A company or entity may still pay an individual’s salary amount in excess of the salary cap, but with non-federal funds. In addition, the cap does not apply to payments made to consultants under an NIH grant although, as with all costs, those payments must meet the tests of reasonableness. The salary limitation provision, however, does apply to sub-awards/subcontracts for substantive work under an NIH grant or contract.

NIH will not adjust grant awards (competing or non-competing) already issued in FY 2014. However, they are allowing re-budgeting. They are also allowing companies and entities to re-budget grants issued in prior years to allow for the 2014 salary cap increase provided funds are available and the increase is warranted. Prorated figures should be used for the applicable months, i.e., the $181,500 level is effective beginning January 12, 2014.

To learn more about the importance of proper time keeping, and its requirements under the Federal Acquisition Regulations, register for our next upcoming webinar,Tuesday March 18th – 2:30pm EST here: