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Examples of Incentive Pay Calculations

Teaching Workload Buyout

A faculty member with a 9-month appointment receives external funding to pay for 10% of her salary to work on a sponsored project during the fall semester and negotiates with her chair to reduce her teaching workload proportionally. The faculty member’s base salary is $75,000. The total amount of salary savings is $7,500. The cost of an instructor to teach the faculty member’s class is $2,700.

Salary savings: $7,500
Instructor costs: $2,700
Net salary savings: $4,800

The faculty member may receive up to $2,400 in incentive pay (50% of the net salary savings).

Research Workload Buyout

Dr. Jones’ institutional base salary is $60,000. His annual workload assignment allocates 20% of his time to research activities. He is a co-PI on a grant that pays for 10% of his time to conduct research on a sponsored project during his 10 month on-contract period.

Salary savings: $6,000
50% of net salary savings: $3,000

The faculty member may receive up to $3,000 in incentive pay.

Research Workload Buyout – when faculty institutional base salary is paid from multiple sources

Dr. Smiths’ institutional base salary of $50,000 is funded from two sources: 80% from appropriated funds and 20% from local funds. Dr. Smith is a co-investigator on a grant that pays for 20% of his salary to conduct research on a sponsored project during his 10 month on-contract period.

Amount of salary paid from appropriated funds during the on-contract period: $40,000
Amount of salary savings to the appropriated funding source: 20% of $40,000, or $8,000

The faculty member may receive up to $4,000 in incentive pay.

Procedure for calculation and disbursement of incentive payments

Before the buyout period

  • At least two weeks before the start of the anticipated buy out period, the faculty member works with his or her department chair and business manager (if applicable) to complete the top portion of the Faculty Incentive Pay Program agreement.
  • The department chair signs the request that confirms that eligibility requirements are met and that the request is consistent with the faculty member’s written workload assignment.
  • The chair or departmental/college administrator (business manager) coordinates obtaining the dean’s and provost’s signatures and forwards the form to the Division of Research and Economic Development for review and approval.
  • The Division of Research and Economic Development signs the form and sends the original form back to the department chair with a copy to the faculty member and the business manager (if applicable).

After the buyout period

  • The faculty member works with his or her department chair and business manager (if applicable) to complete the bottom portion of the Faculty Incentive Pay Program agreement.
  • The department chair signs the agreement and the departmental or college administrator coordinates obtaining the dean’s and provost’s signatures. The signed form is sent to the Division of Research and Economic Development for review and approval.
  • The Division of Research and Economic Development signs the form and sends the original form back to the department chair with a copy to the faculty member and the business manager (if applicable).
  • The business manager or departmental administrator initiates an EAF for the lump sum payment and codes it as “FIP.”
  • An EAF may be submitted at any time after the agreement has been fully signed, however, it MUST be submitted NO LATER THAN May 15 in order to ensure adequate time for processing prior to the end of the fiscal year.

Contact: OSP
Email: osp@boisestate.edu
Phone: 426-4420