Professor Leland Stanford earns a total base salary of $150,000 per year. The salary cap in this example is $125,000.

NOTE: Actual salary caps may fluctuate over time. Be sure to use the current correct applicable cap when calculating allowable and unallowable salary.

In this situation, Professor Stanford will work on three sponsored projects as follows:

1. 20% effort on award PTA2222222-1-PABCD,
   with the salary cap, from 8/98 through 7/99

   On this award, Professor Stanford will charge 10% of his salary directly, and will cost share 10% of his salary to account PTA2222222-2-WABCD.

2. 15% effort on award PTA3333333-1-PAEFG,
   also with the salary cap, from 6/98 through 5/99
   
   
3. 30% effort on award PTA4444444-1-SDDAB,
   which does not include a salary cap, from 1/99 through 12/99.

The balance of his salary will be paid by the Operating Budget, PTA1111111-1-AABCD.

Where the salary cap is applicable, calculate the maximum which can be charged per pay period by dividing the total capped salary ($125,000. in this example) by 24 (the number of pay periods in a year), and multiplying that by the percentage of effort on the NIH project.

Professor Stanford's actual pay per pay period is $6250 ($150,000 / 24). The maximum allowed under the salary cap is $5208 ($125,000 / 24). The percent of effort on the NIH projects multiplied by the difference between these amounts is an unallowable cost.

When you are cost sharing on an agency award with an applicable salary cap, apply the salary cap in the same way as you would for directly-charged salary.

A Note about Oracle Labor Distribution:

The Oracle Labor Distribution Labor Schedules require percentages to be entered rather than dollar amounts. Templates are available to assist you in these calculations, as panels require 100% of the Stanford pay to be distributed and the calculations get complicated!

Don't forget to use the special "RBE (Regular Benefits Eligible) Unallowed Salary Over Cap" Expenditure Type 51190 to capture the salary percentage over the cap. The use of this Expenditure Type flags the dollars as unallowable. Stanford must include those dollars in its Organized Research or other applicable base.

The tables below how Professor Stanford's Labor Schedule must be set up (remember to enter the calculated percent, not the percentage of effort). The tables represent different points in time between 8/98 and 12/99, while Professor Stanford is working on the projects listed above.

Information in Labor Schedule effective on 9/1/98 Projects A and B, listed above, are active.
Project	Task	Award	Exp Type	Percentage	For illustration only These Columns do not appear in LD.
					Corresponding Amount	Calculation
2222222	1	PABCD	51115	8.333%	$520.83	$125,000/24 * 10%
2222222	2	WABCD	51115	8.333%	$520.83	$125,000/24 * 10%
3333333	1	PAEFG	51115	12.50%	$781.25	$125,000/24 * 15%
1111111	1	AABCD	51190	5.834%	$364.59	($150,000 - $125,000)/24 * (10% +10% + 15%)
1111111	1	AABCD	51115	65.00%	$4,062.50	$150,000/24 * 65%
				100%	$6,250.00

---

Information in Labor Schedule effective on 1/1/99 New schedule line for Project C starts. Projects A and B still active.
Project	Task	Award	Exp Type	Percentage	For illustration only These columns do not appear in LD.
					Corresponding Amount	Calculation
2222222	1	PABCD	51115	8.333%	$520.83	$125,000/24 * 10%
2222222	2	WABCD	51115	8.333%	$520.83	$125,000/24 * 10%
3333333	1	PAEFG	51115	12.50%	$781.25	$125,000/24 * 15%
1111111	1	AABCD	51190	5.834%	$364.59	($150,000 - $125,000)/24 * (10% +10% + 15%)
4444444	1	SDDAB	51115	30.00%	$1,875.00	$150,000/24 * 30%
1111111	1	AABCD	51115	35.00%	$2,187.50	$150,000/24 * 35%
				100%	$6,250.00

---

Information in Labor Schedule effective on 6/1/99 Schedule line for Project B ends. Projects A and C still active.
Project	Task	Award	Exp Type	Percentage	For illustration only These columns do not appear in LD.
					Corresponding Amount	Calculation
2222222	1	PABCD	51115	8.333%	$520.83	$125,000/24 * 10%
2222222	2	WABCD	51115	8.333%	$520.83	$125,000/24 * 10%
3333333	1	PAEFG	51115	0.00%	-
1111111	1	AABCD	51190	3.334%	$208.34	($150,000 - $125,000)/24 * (10% + 10%)
4444444	1	SDDAB	51115	30.00%	$1,875.00	$150,000/24 * 30%
1111111	1	AABCD	51115	50.00%	$3,125.00	$150,000/24 * 50%
				100%	$6,250.00

---

Information in Labor Schedule effective on 8/1/99 Schedule line for Project A ends. Only Project C remains active.
Project	Task	Award	Exp Type	Percentage	For illustration only These columns do not appear in LD.
					Corresponding Amount	Calculation
2222222	1	PABCD	51115	0.00%	-
2222222	2	WABCD	51115	0.00%	-
3333333	1	PAEFG	51115	0.00%	-
1111111	1	AABCD	51190	0.00%	-
4444444	1	SDDAB	51115	30.00%	$1,875.00	$150,000/24 * 30%
1111111	1	AABCD	51115	70.00%	$4,375.00	$150,000/24 * 70%
				100%	$6,250.00