It is important to understand that Salaries and Wages, while grouped together as a category are different from each other. The two terms are often used synonymously but there are significant differences with legal implications. Fundamentally, a salaried employee is paid a fixed amount per pay period and a wage-earning employee is paid by the hour.

So it follows that with a salary there's no connection between the amount paid and the number of hours worked (i.e. a salaried employee doesn't get paid more for working longer hours or less for working shorter hours). Salaried workers often have a minimum hours stipulation or expectation and while their continued employment might be conditional upon the meeting of that minimum expectation, their compensation level is not.

A common stipulation is that a salaried employee should work a minimum of 40 hours per week. Not taking into account PTO, that means an expected 2,080 hours per year (40 x 52 weeks = 2,080). Dividing a person's base salary by 2,080 correspondingly gives you a rough approximation of their hourly rate relative to that expected 40 hours. Someone who is being paid a salary of $52,000 would therefore expect to receive pay of $2,000 every bimonthly payroll ($52,000 / 26 payroll periods per year).

By contrast, a wage-earner who is being paid $25/hour might earn $2,000 bimonthly if they were to work 40 hours ($25 x 80 hours = $2,000) but if they were only to work 20 hours they would earn $1,000 ($25 x 40 hours = $1,000).

In the simplest and most common terms, most staff roles at Rice corresponding to the factors involved with Research Administration are salaried, with wage-earning roles being predominantly limited to part time positions, including student workers.

There are Fair Labor Standards Act (FLSA) considerations to take into account when knowing which type of role is appropriate for which type of payment and clarification around which pathway to choose on this can be provided by HR on a case by case basis if it is unclear.

Use of the Category Type 'Salaries & Wages' in Financial Reporting

The expression "Salaries & Wages" refers to all cash expenditures paid to employees in a given context. This includes money that might be withheld by the employer on behalf of the employee for income taxes, retirement contributions, pre-tax health plans, social security payments etc.

It does not include employer contributions to any employee plans (retirement, health, etc.)

Fringe Benefits

Fringe benefits are benefits provided to an employee.

They are specific costs. They are expenses that the employer is incurring on behalf of the employee

Payroll Taxes (Social Security, Medicare)
PTO (Vacations, holidays, sick leave)
Health care benefits
Life Insurance
Post-Retirement Benefits (health care, life insurance, pensions)

Sponsored Projects contain the cost of Fringe Benefits in their budget.

They are billed to the sponsored project at the time that the Salary & Wages cost is incurred.

Fringe Benefit Rate Calculation

Fringe Benefits are calculated using 'pooled' rates. The basic conceptualization of that calculation is shown below.

The institutional rates are calculated by Rice annually and approved by DHHS. The current rates, and more details about what they cover are stored within an OSP Box Folder (FY24 Rate Summary.pdf | Powered by Box )

Base Salary

Compensation is based on an individual’s total Institutional Base Salary.

Base Salary is the annual compensation paid by the University for an Employee’s Appointment, whether that individual’s time is spent on research, teaching, teaching administration, clinical activity or any other activities.

Base Salary also includes secondary administrative appointments such as department chair, associate deans, etc.

Base Salary does not include items such as:

Honorarium payments, incentives/bonuses or other one-time payments
Income that an individual is permitted to receive directly from third parties outside of their University, including responsibilities such as consulting fees.

Effort

Effort is defined as the proportion of time spent on any activity expressed as a percentage of the total institutional activities for which an individual is compensated by the University, regardless of part-time or full-time status and/or number of hours worked. Total Effort is always 100% whether a person is employed on a full-time basis by the University or on a part-time basis.

Faculty members with multiple appointments consider their combined responsibilities to arrive at their Total Effort.

Conceptualizing Effort

Faculty Members

Post Docs and Staff

Graduate Student Research Assistants

Scholarships and Fellowships (section requires update post May 2024)

Scholarships are considered to be a form of financial aid. They are a contribution from an entity that is external to the university that offsets or fully meets the bill for a student's cost of tuition. In this frame, Fellowships are considered similarly to Scholarships.

Fellowship-supporting awards are merit-based competitive internal or external awards that support a full-time course of study of qualified graduate students. Fellows receive financial support to focus on their graduate research and training without the requirement of service to the university (teaching or research).

When a Graduate Fellow is paid for by a Sponsored Project, they are paid via a stipend payment and not salaried via payroll. They are considered to be participants in an educational program and therefore cannot register 'effort' relative to a sponsored project or award.

The following is a very important distinction to understand. Resolving mistakes in selecting the wrong payment type can be difficult (or impossible) to resolve.

Graduate Fellow (Engaged in Training and not considered to be carrying out Research)

Charging Flexibility = Costs cannot be reallocated once incurred
Paid via Stipend
Payment method = Payables
Effort Certification Applies = No
Further comments = Check carefully that the source of funding and the specific call guidance state that the intention is to compensate program participants as Graduate Fellows. Furthermore, in addition to using the correct payment method, be sure to charge costs to the specific project within an award that is designated for Graduate Fellows. This project will (or should) be set up as a participant support project.

Graduate Research Assistant (Engaged in research)

Charging Flexibility = Labor Can be Reallocated or Split via Labor Distribution
Paid via Salary
Payment method = Payroll
Effort Certification Applies = Yes
Further Comments = Check carefully that this option and payment mechanism is not applied when the funding source is configured for Graduate Fellows. Charging Graduate RAs to such a participant support project is ineligible and will need to be corrected. Take note that while a Graduate RA can also be a Graduate TA, the combined effort must not exceed 1 FTE.

Graduate Teaching Assistant (Engaged in teaching)

Charging Flexibility = Labor Can be Reallocated or Split via Labor Distribution
Paid via Salary
Payment method = Payroll
Effort Certification Applies = No
Further Comments = Check carefully that this option and payment mechanism is not applied when the funding source is configured for Graduate Fellows. Charging Graduate RAs to such a participant support project is ineligible and will need to be corrected. Take note that while a Graduate TA can also be a Graduate RA, the combined effort must not exceed 1 FTE.

How is labor managed?

Hiring

Onboarding

Labor Distribution

Labor distributions run on the 15th of a month and on the last day of a month.

File naming convention for adobe sign is 'DIV-(SSorAYT)-DEPT-YYMMDD-(Ref)'.
Examples
'ENG-AYT-ECE-2305180-Prof Spengler'

'HUM-HIST-230530-New Hires'

Template https://rice.app.box.com/s/dm2dhsqekvckmb4i302q9nrjqmsjra1w

FY23 Video https://rice.app.box.com/s/87ctxj3qrq3qkjihwlmth4zfgqbkg6q0

Departmental Return Box Folder (job aid)

Payroll Terminology

https://rice.app.box.com/s/rzck4rlbdtaaqkwo31924f5tmhcm9vt1

Labor Distribution at Rice (iO Course)

https://emdz.fa.us2.oraclecloud.com/fscmUI/redwood/learner/learn/redirect?learningItemId=300000849563895&learningItemType=ORA_COURSE

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