Academic Year Appointments
Description
For payroll purposes, it is assumed that faculty or postdoctoral scholars with academic year appointments begin their work obligation on August 16th and end it on May 15th, while their payment schedule is spread across the entire fiscal year, i.e. 7/1 to 6/30. This payment schedule provides the faculty member or postdoctoral scholar with an uninterrupted income stream across the entire fiscal year.
Here is how it works:
Dr. Wolf is on an academic year contract earning an annual salary of $45,000.
He will earn $45,000 over nine months.
| August 16 – 31 | $ 2,500 |
| September – April | $40,000 / $5,000 per month |
| May 1 – 15 | $ 2,500 |
Total earned is $45,000
However, Dr. Wolf will be paid over twelve months.
$3,750 per month for 12 months = Total paid is $45,000
Here is another way to look at it:
| Earned 8/16 – 5/15 |
Earned YTD |
Paid 7/01 – 6/30 |
Paid YTD |
|
|---|---|---|---|---|
| July | $ 0.00 | $ 0.00 | $ 3,750 | $ 3,750 |
| August* | $ 2,500 | $ 2,500 | $ 3,750 | $ 7,500 |
| September | $ 5,000 | $ 7,500 | $ 3,750 | $11,250 |
| October | $ 5,000 | $12,500 | $ 3,750 | $15,000 |
| November | $ 5,000 | $17,500 | $ 3,750 | $18,750 |
| December** | $ 5,000 | $22,500 | $ 3,750 | $22,500 |
| January | $ 5,000 | $27,500 | $ 3,750 | $26,250 |
| February | $ 5,000 | $32,500 | $ 3,750 | $30,000 |
| March | $ 5,000 | $37,500 | $ 3,750 | $33,750 |
| April | $ 5,000 | $42,500 | $ 3,750 | $37,500 |
| May* | $ 2,500 | $45,000 | $ 3,750 | $41,250 |
| June | $ 0.00 | $ 3,750 | $45,000 | |
| $45,000 | $45,000 |
* The amount for August and May is estimated here. If the employee were to leave early or start late the actual amount earned in August and/or May would have to be calculated based on the actual number of workdays in that month for that year.
** As long as the employee fulfills the work obligation for the fall semester (8/16 – 12/31), they are considered to have fulfilled one half of their contract and therefore earned one half of their annual salary. Notice that at the end of December the YTD salary for Earned and Paid are the same.
Note: Employees on an academic year contract do not receive a check in July of their first year. They receive two months (or two twelfths) of their pay in August, after they have actually started work.
Since the HR System has been set up to provide faculty and postdoctoral scholars with academic year appointments their salary in 12 equal monthly payments spread across the entire fiscal year without manual intervention by the payroll staff, hire and separation actions with an effective date other than 1/1 or 7/1 will generally lead to an overpayment or underpayment of the faculty member. Therefore, if you know in advance that the employee will deviate from the normal contract dates, be careful to accurately represent this in his/her offer letter and to notify the Payroll Supervisor. Here is a good rule of thumb:
- Fall Semester
- Start late – we will owe them
- Leave early – they will owe us
- Spring Semester
- Start late – they will owe us
- Leave early – we will owe them
If you need help with the wording on an offer letter, contact either Ryan Bernarduci, EPA Consultant, or Mary Richardson, EPA Consultant. For help with deviated contract calculations contact the Payroll Supervisor.
Below are two examples of deviated contracts. In the first one, Dr. Wolf starts after the beginning of the fall semester and in the second example, he leaves before the end of the fall semester. These are very simplistic examples and are not meant to represent actual calculations.
Example #1
| Earned 10/01 – 06/30 |
Earned YTD |
Paid 10/01 – 06/30 |
Paid YTD |
|
|---|---|---|---|---|
| July | $ 0.00 | $ 0.00 | $ 0.00 | $ 0.00 |
| August | $ 0.00 | $ 0.00 | $ 0.00 | $ 0.00 |
| September | $ 0.00 | $ 0.00 | $ 0.00 | $ 0.00 |
| October | $ 5,000 | $ 5,000 | $ 3,750 | $ 3,750 |
| November | $ 5,000 | $10,000 | $ 3,750 | $ 7,500 |
| December | $ 5,000 | $15,000 | $ 3,750 | $11,250 |
| January | $ 5,000 | $20,000 | $ 3,750 | $15,000 |
| February | $ 5,000 | $25,000 | $ 3,750 | $18,750 |
| March | $ 5,000 | $30,000 | $ 3,750 | $22,500 |
| April | $ 5,000 | $35,000 | $ 3,750 | $26,250 |
| May | $ 2,500 | $37,500 | $ 3,750 | $30,000 |
| June | $ 0.00 | $0.00 | $ 3,750 | $33,750 |
| $37,500 | $37,500 |
As you can see in the above example – because Dr. Wolf started late in the fall semester, he is not going to be paid as much as he will earn during the semester. His October paycheck will need to be adjusted to compensate for this. His actual earned vs. paid will look like this:
| Earned 10/01 – 06/30 |
Earned YTD |
Paid 10/01 – 06/30 |
Paid YTD |
|
|---|---|---|---|---|
| July | $ 0.00 | $ 0.00 | $ 0.00 | $ 0.00 |
| August | $ 0.00 | $ 0.00 | $ 0.00 | $ 0.00 |
| September | $ 0.00 | $ 0.00 | $ 0.00 | $ 0.00 |
| October | $5,000 | $ 5,000 | $7,500 | $ 7,500 |
| November | $5,000 | $10,000 | $3,750 | $11,250 |
| December | $5,000 | $15,000 | $3,750 | $15,000 |
| January | $5,000 | $20,000 | $3,750 | $18,750 |
| February | $5,000 | $25,000 | $3,750 | $22,500 |
| March | $5,000 | $30,000 | $3,750 | $26,250 |
| April | $5,000 | $35,000 | $3,750 | $30,000 |
| May | $2,500 | $37,500 | $3,750 | $33,750 |
| June | $0.00 | $0.00 | $3,750 | $37,500 |
| $37,500 | $37,500 |
Example #2
| Earned 08/16 – 05/15 |
Earned YTD |
Paid 07/01 – 06/30 |
Paid YTD |
|
|---|---|---|---|---|
| July | $0.00 | $0.00 | $ 3,750 | $ 3,750 |
| August | $ 2,381 | $2,381 | $ 3,750 | $ 7,500 |
| September | $ 5,000 | $7,381 | $ 3,750 | $11,250 |
| October | $ 5,000 | $12,381* | $ 3,750 | $15,000 |
| November | $0.00 | $0.00 | $0.00 | $0.00 |
| December | $0.00 | $0.00 | $0.00 | $0.00 |
| $12,381 | $15,000 |
As you can see above, if Dr. Wolf left at the end of October, and payroll was not notified before the October payroll was processed Dr. Wolf would be overpaid and would have to repay $2,619.00 ($15,000 paid vs $12,381 earned). However, if payroll was notified before the October payroll was processed Dr. Wolf’s October check would be adjusted (see below) to eliminate the overpayment.
| Earned 08/16 – 05/15 |
Earned YTD |
Paid 07/01 – 06/30 |
Paid YTD |
|
|---|---|---|---|---|
| July | $0.00 | $0.00 | $3,750 | $3,750 |
| August | $2,381 | $2,381 | $3,750 | $7,500 |
| September | $5,000 | $7,381 | $3,750 | $11,250 |
| October | $5,000 | $12,381* | $1,131 | $12,381 |
| November | $0.00 | $0.00 | $0.00 | $0.00 |
| December | $0.00 | $0.00 | $0.00 | $0.00 |
| $12,381 | $12,381 |
*If the employee does not work the full semester, but the portion he/she does work includes either August or May, the actual amount earned based on the # of work days in that month must be calculated. In this case the following formula was used to calculate the “amount earned” for August.
- 5,000 per month / 21 work days in August (2008) * 10 days (August 16th – August 31st) = $2,381.00