Concept: Salary Over Cap Costing (USA)

Costing for Sponsor Award with Salary Cap

When you set up an award with a sponsor salary cap in Workday Grants Management, you can set up salary over cap costing instructions for Workday Payroll. Workday requires more time to process payroll for workers with salary over the cap.

Salary Over Cap Costing Worktags

There are 3 kinds of worktags in salary over the cap costing:

Grant worktag associated with an Award with Sponsor Salary Cap: Once you assign this grant to a costing allocation, it remains assigned throughout the costing and payroll processes.
Salary Over the Cap Type (SOC Type): To determine what falls under the sponsor salary cap, Workday evaluates earnings in the pay component group you define on the
Maintain Salary Cap
task. Workday then applies the Salary Over the Cap Type
worktag to any payroll amount that is either:
Over the cap.
Not part of the pay component of the salary cap for the associated grant on the award line.

Selecting the
Salary Over the Cap - Use Costing Overrides when Earning isn't in the Pay Component Group
check box in
Edit Tenant Setup - Payroll
allocates earnings that you haven't included in the salary cap pay component group to costing override worktags you've configured.
Salary Over the Cap Basis: Salary Over the Cap Basis
worktags enable you to identify over the cap costs on journal lines for payroll:
Actuals.
Actuals Forward Accruals.
Commitments.
Obligations.

The Salary Over the Cap Basis
worktag is also available as a dimension on account posting rules and as an optional summary dimension if you enable journal summarization.

When a costing allocation has a grant worktag and the grant is subject to the salary cap in the

Assign Costing Allocation

task, you can:

Use the action button in the

Salary Over the Cap

column to access the salary over cap suballocation costing grid.

Edit the worker's organizational default worktags on the salary over cap suballocation.

Edit the worker's costing company if you've enabled intercompany accounting.

Example: Full Time Costing Allocation

Dr. Kay works full time as a researcher on a project associated with a grant subject to a salary cap: SOC Grant A.

Dr. Kay earns $240,000 base salary a year, and is on a monthly period schedule, earning $20,000 per month.

SOC Grant A is subject to the award salary cap of $180,000 base yearly salary, or $15,000 per month.

You assign costing allocation rules for Dr. Kay:

For salary covered by the grant subject to the salary cap: SOC Grant A, Fund A, Cost Center A at 100%.

For the salary over the cap portion: Fund B, Cost Center B at 100%.

Default (As of Start Date)	SOC Suballocation	Distribution Percent
SOC Grant A Fund A Cost Center A		100
	Fund B Cost Center B	100

Result lines after payroll accounting processing:

Default (As of Start Date)	Due to SOC Suballocation	Distribution Amount
SOC Grant A Fund A Cost Center A		15,000
	SOC Grant A Fund B Cost Center B Salary Over the Cap Type	5,000

Example: Split Effort Costing Allocation

Professor Chavez works half time as a professor in Cost Center Physics, and the other half as researcher on a project associated with a grant subject to salary cap: SOC Grant A.

She earns $240,000 base salary a year, and is on a monthly period schedule earning $20,000 per month.

Half of her salary, or $10,000 per month, is costed to Cost Center Physics, Fund P.

SOC Grant A has an award salary cap of $180,000 base yearly salary, or $15,000 per month. Her effort level on SOC Grant A is 50%, which caps the monthly salary billable to SOC Grant A at $7,500.

You assign costing allocation rules for the Professor:

For the physics teaching salary not costed to the grant: Fund P, Cost Center Physics.

For salary covered by the salary over cap grant: SOC Grant A, Fund A, Cost Center A at 50%.

For the salary over the cap portion: Fund B, Cost Center B at 100%.

Default (As of Start Date)	SOC Suballocation	Distribution Percent
Fund P Cost Center Physics		50
SOC Grant A Fund A Cost Center A		50
	Fund B Cost Center B	100

Result lines after payroll accounting processing:

Default (As of Start Date)	Due to SOC Suballocation	Distribution Amount
Fund P Cost Center Physics		10,000
SOC Grant A Fund A Cost Center A		7,500
	SOC Grant A Fund B Cost Center B Salary Over the Cap Type	2,500