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Other direct costs

Budget justification best practices

General salary and wage information


  • Salary rates for personnel employed on sponsored projects must be consistent with sponsor guidelines as well as the rates paid from university-administered funds. 
  • Salaries charged to sponsored projects must coincide with the period during which the effort on the project is expended.
  • Normally only salary for faculty, technicians, research associates and assistants, postdoctoral associates and other technical or programmatic personnel that are necessary to meet the goals of the project are allowed as direct costs.
  • Inclusion of administrative and clerical salaries as direct costs require compliance with ASU’s CAS exception practices.
  • Compensation and new job classifications must conform to ASU Human Resources classifications.
  • Additional pay (above institutional base salary and excluding summer salary) must be clearly stated in the budget and budget justification.  Review of policy ACD 510-04 should be completed prior to budgeting for additional pay.
  • Budget additional pay (intra-university consultant pay) as salary plus ERE.

Mandatory annual escalation factor

Unless expressly prohibited in writing by the sponsor, a 3% escalation factor must be budgeted on salaries and ERE for each year of the project. This factor is based on average increases for past years. Note: Some Sponsors may limit escalation. Sponsor policy and the funding opportunity should be reviewed. If a Sponsor does not have a written policy and has indicated a limitation, contact your assigned PNT GCO for guidance.

Salary and wages

Determining salary/appointment information in PeopleSoft

  • Use the Compensation tab to confirm salary.
  • Although the Compensation tab contains appointment (frequency) information, it is recommended that you use the Payroll tab to identify what kind of appointment or contract an employee is on.

Pay group (and frequency codes you will commonly see/use:

Pay groupFrequency codeDefinition
A12Bi-weekly9 months paid over 12 months
ACDASU209 months paid over 9 months
SALASUBW12-month staff appointment paid over 12 months
FSWASU06Faculty summer salary
STUHourlyHourly student

Determining salary for to-be-hired staff

Refer to the ASU Business and Finance Job Descriptions page for staff position titles, job descriptions, and salary ranges.

Budgeting salary and wages

List the amount of time to be spent by each ASU employee who will work on the project and the rate of pay. Time can be shown in percent of effort; number of months; or in person-hours (days, weeks or months). Percent of full-time effort or number of months is the preferred method.

Employment periodTimeframeWeeksDaysHours
1 month4.322176
Academic Year (AY)9 months (mid-August to mid-May)39.01951560
Fiscal Year (FY)12 months (July 1 to June 30)52.02602080
Summer3 months (mid-May to mid-August)13.065520

For budgets which use hourly rates

See Hourly Rates Proposal Development Information for the statement that is to be included in the budget justification.

Danger pay (DPA)

See Other Direct Costs guidance.

Student salary and wages

Postdoctoral associate (postdoc) salary

ASU guidance is to utilize the NIH Postdoc stipend levels as a minimum salary when budgeting postdoctoral associates. These rates are based on the individual’s years in the postdoctoral associate position and should be utilized as the minimum salaries for all proposal submissions. You can find these rates on the NIH Salary Cap, Stipends, & Training Funds site. Note: Salary levels may vary by discipline – contact the unit’s Business Operations Manager for the full unit-approved salary range.

Graduate research assistant/associate salaries

Based upon the Graduate College policy, GRA effort during the AY cannot exceed 20 hours per week and is thus considered 100% effort. It is recommended that 100% AY effort (20 hours per week) be presented as 9.0 AY months on sponsor budget forms. Per Provost’s office, the minimum AY salary is $26,544 for 20 hours per week beginning Spring 2025. For the full unit-approved salary range, contact the unit’s Business Operations Manager. The Business Operations Manager can also provide information about the unit’s implementation of the Affordable Care Act. For employment during other times of the year, see: https://students.asu.edu/employment/employers.

Hourly undergraduate and graduate student wages

For information about hiring hourly students, including the current standard wage scale, see: https://students.asu.edu/employment/employers. Since customary rates vary from department to department, contact the student’s departmental Business Operations Manager or RA to determine the most appropriate rate. Increases may be added based on experience. Contact Student Employment Office at 5-5186 for further information about on-campus student employee compensation.

Parental leave for postdocs, graduates RA/TAs

Postdoctoral scholars, graduate research assistants and graduate teaching assistants who have completed at least one academic year of service are eligible for up to twelve weeks of paid parental leave for the birth or adoption of a child. If both parents are postdoctoral scholars or graduate students with a .50 FTE RA/TA appointment, effective immediately, both eligible parents may receive the accommodation. Previously only one eligible parent was able to receive paid parental leave.

For RAs/TAs on sponsored projects please verify that the award does not prohibit charging salary to the project during the time that the person is on leave. If a position is supported by multiple accounts, this distribution should be consistent before, during, and after leave.

Please also work with the principal investigator to discuss the impact on the budget, progress of the project, and how resources will be managed to continue the work of the project. Budget revisions may be required to absorb additional personnel costs if they are needed during the leave period.

Salary caps and limitations

NIH salary cap

Observe the current NIH annual salary rate limitation. For previous fiscal year award salary cap information, click here. This cap applies to grants and cooperative agreements.

NSF salary limitations

  • NSF funds may not be used to increase the base salaries of project personnel.
  • NSF funds may not be used to reimburse faculty members for consulting or other time in addition to a regular full-time organizational salary covering the same general period of employment. Exceptions may be considered under certain NSF grants for teaching weekend and evening classes or working at remote locations.
  • As a general policy, NSF limits salary compensation for senior project personnel to no more than two months of their regular salary in any one year.  This limit includes salary compensation received from all NSF-funded grants.
  • At proposal time, requests for exceptions to salary limitations should be 1) disclosed in the proposal budget and 2) justified in the budget justification.  The NSF award will serve as documentation of any approval or denial of the request.
  • If after an award is made, increases or decreases in the senior project personnel person months devoted to the project will occur, the PI must certify in writing and the unit must document to its files that the change does not cause the objective or scope of the project to change.  No prior NSF approval is necessary as long as these requirements are met.   Changes to person months compensated, which impact the objectives or scope of work, require prior NSF approval, using the NSF research.gov’s notifications module.

For additional information about Senior Project Personnel Salaries and Wages, see NSF’s Grant Proposal Guide.

Other sponsors imposing salary caps

Salary caps vary from sponsor to sponsor. Refer to FA and sponsor guidelines to determine the salary cap in effect.

  • Administration for Children and Families
  • Administration for Community Living
  • Administration for Native Americans
  • Administration on Aging
  • Agency for Healthcare Research and Quality
  • Bureau of Health Professionals
  • Centers for Disease Control and Prevention
  • Center for Global Health
  • Centers for Medicaid and Medicare Services
  • Consumer Information and Insurance Oversight
  • Health Resources and Services Administration
  • National Center for Child Abuse and Neglect
  • National Institute of Justice
  • Office of Community Services
  • Office of Planning, Research and Evaluation
  • Patient-Centered Outcomes Research Insistute
  • Substance Abuse and Mental Health Services Administration
  • US Agency for International Development

The total compensation (defined as “salary and all benefits”) paid to any employee under a Federal cost-reimbursable contract is limited to $487K per year.  If an individual Federal agency has a lower limit for contracts, either on salaries (institutional base salary) or total compensation (salary and ere), then that lower cap applies. Grants and cooperative agreements are not covered under this rule. For clarifications, contact [email protected].

Employee-related expenses (aka ERE or fringe benefits)

Employee categoryEmployee class*FY2024FY2025FY2026FY2027FY2028FY2029 and beyond
FacultyFacAdmAppt (FAA)
27.10%27.91%28.75%29.61%30.50%Escalate at 3% per year
StaffAcademic Prof Admin
Srvc Prof
34.20%35.23%36.28%37.37%38.49%Escalate at 3% per year
Postdoctoral AssociatePostdoc 21.70%22.35%23.02%23.71%24.42%Escalate at 3% per year
RA/TA11.50%11.85%12.20%12.57%12.94%Escalate at 3% per year
Student (hourly)/graduate or undergraduate1.60%1.65%1.70%1.75%1.80%Escalate at 3% per year
Part-time and non-benefits eligible**10.20%10.51%10.82%11.15%11.48%Escalate at 3% per year

*Employee class codes are noted in each employee’s PeopleSoft file under the Job Information tab.  For further information about employee class codes, see this ERE Rates document from ASU Financial Services.


  • Any start date of six months or more into a fiscal year will use the following fiscal year’s rates.
  • If any one of an employee’s jobs is benefits eligible, the employee will be provided benefits and all active jobs will be charged ERE based on the employee class.
  • Benefits eligibility is determined by examining the duration (permanence) of the job and the FTE.
  • When a faculty member, staff member, or postdoctoral employee’s overall employment from all ASU sources will be less than .50 FTE, the employee will not be benefits eligible.
  • An employee can have a .50 or greater FTE job and still not be benefits eligible. A job with a duration classified as short-term temporary, seasonal or PRN will not be benefits eligible regardless of FTE.
  • Additional pay (intra-university consultant fee) is subject to ERE.
  • When ERE is limited by the sponsor, the unit is required to cover the difference between the full ERE rate (in table above) and the limited ERE rate. 

Refer to the ASU Human Resources website for further details: https://cfo.asu.edu/hr.

All proposals must be budgeted in accordance with the above chart. 

A detailed breakdown of the ERE rates for the current fiscal year is available in the latest ERE Rate Analysis document.

Information on historical ERE rates is found in this Historical ERE Rates document.