IMPORTANT NIH UPDATE: Guidance on Salary Limitation

Thu, 10 Apr 2025 11:19:33 -0400

Guidance on Salary Limitation for Grants and Cooperative Agreements FY 2025

Notice Number: NOT-OD-25-085

https://grants.nih.gov/grants/guide/notice-files/NOT-OD-25-085.html

Purpose:

This Notice provides information regarding the salary limitation for NIH grant, cooperative agreement, and extramural research and development contract awards.

Since 1990, Congress has legislatively mandated a limitation on salary for individuals under NIH grant and cooperative agreement awards (referred to here as a grant).

As a reminder, effective October 1, 2024, this mandate applies to both direct salaries (individuals working directly on NIH projects) and indirect salaries (executive salaries in various uncapped cost pools). The mandate appears in the annual appropriation act that provides authority for NIH to incur obligations for a given Fiscal Year (FY). HHS/NIH has not received an FY 2025 appropriation and is operating under a Continuing Resolution, the “Full-Year Continuing Appropriations and Extensions Act, 2025 (Public Law 119-4)”, that applies the terms and conditions of the Consolidated Appropriations Act, 2024.

The Consolidated Appropriations Act, 2024 restricts the amount of salary to Executive Level II of the Federal Executive pay scale. The Office of Personnel Management recently released new salary levels for the Executive Pay Scale. Effective January 1, 2025, the salary limitation for Executive Level II is $225,700.

For active awards, including awards that have been issued in FY 2025 (continuation and new) that were restricted to Executive Level II, if adequate funds are available, and if the salary cap increase is consistent with the institutional base salary, recipients may rebudget funds to accommodate the current Executive Level II salary level. Recipients may not draw down funds, whether direct or indirect costs, to pay salaries above the salary rate limitation, and recipients must have established policies and procedures that are consistently applied regardless of the source of funds.

Please refer to the full notice linked above for further details.

Should you have any questions, please contact the Office of Sponsored Programs.