Office of Research & Creative Scholarship

Fringe Benefits on Sponsored Programs


Summary

The Fringe Benefit Rates are established in accordance with the federal government's Office of Management and Budget (OMB) Circular A-21, Cost Principles for Educational Institutions. The rates are negotiated between Emerson and the Department of Health and Human Services, the Division of Cost Allocation (the DHHS, DCA), which is the cognizant federal agency overseeing the administration of sponsored agreements at Emerson. The approved rates must be applied to sponsored programs salary when developing budgets or for charges of actual salary costs.


Calculation of the Fringe Benefit Rate

The Fringe Benefit Rate is calculated by pooling all Emerson College employee benefit expenses (the numerator) and comparing the expense to Emerson’s salary and wage base (denominator). A rate is developed by dividing the pool by the base; this rate represents the percentage that must be added to employees’ salaries and wages incurred for sponsored projects.


Predetermined Rate

Emerson negotiates a predetermined fringe benefit rate with the DHHS, DCA which is based on the actual costs for the base year and does not require any adjustment in the future years.  Our current negotiated fringe benefit rates are applicable for the period covered by our current DHHS agreement (e.g., 7/1/2012 – 6/30/2016).


Components of Fringe Benefit Rate

The fringe benefit costs included in the negotiated rate are: FICA, Retirement, Life, Disability, and Unemployment Insurance, Tuition Reimbursement (Employee Only), Health Insurance, Dental Insurance and Parking.


Paid and Unpaid Absences

Vacation, holiday, sick leave pay and other paid absences are included in salaries and wages, and are claimed on grants, contracts and other agreements as part of the normal cost for salaries and wages.  Unpaid sabbatical and research leave are not charged to sponsored projects.


Application of Fringe Benefit Rate

The fringe benefits are charged using the rates negotiated with the cognizant agency. The rates are applied to the portion of salaries and wages allocable to the sponsored project.