In addition to salary, fringe benefits are part of the compensation package provided to employees. Fringe benefits include the cost of unemployment and workers' compensation insurance, Federal Insurance Contributions Act (FICA), medical and dental insurance, group insurance, annuity, New York State disability insurance, disability income protection, tuition remission for employees, travel insurance and the operational costs of fringe benefit administration.
New York University's (NYU's) Fringe Benefit Rate is negotiated with the Department of Health and Human Services (DHHS). The rate must be applied to budgeted salary amounts in proposals and to actual salary costs when directly charged to sponsored agreements.
Calculation of Fringe Benefits charged to a Sponsored Project:
Fringe Benefits = (Monthly IBS) x (percent of Effort) x (number of months devoted to project) x (Fringe Benefit Rate)
Note: This formula will be also used to calculate the fringe benefit during the summer months.
Calculation of Fringe Benefits charged to a Sponsored Project with a Salary Cap:
Fringe Benefits with Salary Cap = (Salary Cap ÷ 12) x (percent of Effort) x (number of months devoted to project) x (Fringe Benefit Rate)
Note: For graduate assistants (GRAs), tuition remission is charged as a percentage of their salary instead of fringe benefits.
Vacation, holiday, sick leave pay and other paid absences are included in salaries and wages and are not a component of the costs covered by the fringe benefit rate.