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The NIH salary cap is the maximum amount of direct salary that an individual can receive from an NIH grant, cooperative agreement, or contract. The salary cap is based on the Executive Level II of the Federal Executive Pay Scale, which is set by Congress and adjusted periodically.
The NIH salary cap for 2023 has increased from $203,700 to $212,100, effective from January 1, 2023. This means that if you are a principal investigator or a key personnel on an NIH-funded project, you cannot charge more than $212,100 of your annual salary to the grant. However, your institution can pay you beyond the cap with non-grant funds.
How to calculate the NIH salary cap
To calculate the NIH salary cap, you need to know your annual salary and the percentage of effort that you devote to the NIH-funded project. The formula is:
NIH salary cap=Annual salary×Percentage of effort×Cap factor
The cap factor is the ratio of the salary cap to the Executive Level I of the Federal Executive Pay Scale, which is $221,400 for 2023. The cap factor for 2023 is:
Cap factor=221,400212,100=0.958
For example, if your annual salary is $250,000 and you devote 50% of your effort to an NIH-funded project, your NIH salary cap for 2023 is:
NIH salary cap=250,000×0.5×0.958=119,750
This means that you can charge up to $119,750 of your salary to the grant, and the remaining $130,250 must be paid by other sources.
How does the NIH salary cap affect postdocs?
The NIH salary cap does not directly affect postdocs who are supported by NIH training grants (T) or fellowship grants (F), because they receive stipends instead of salaries. The stipends are set by the HHS Secretary and adjusted annually to reflect the cost of living.
The NIH stipend levels for 2023 are shown in the table below.
| Career Level | 12 months | 1 month |
|---|---|---|
| Predoc | $27,144 | $2,262 |
| Postdoc 0 | $56,484 | $4,707 |
| Postdoc 1 | $56,880 | $4,740 |
| Postdoc 2 | $57,300 | $4,775 |
| Postdoc 3 | $59,592 | $4,966 |
| Postdoc 4 | $61,572 | $5,131 |
| Postdoc 5 | $63,852 | $5,321 |
| Postdoc 6 | $66,228 | $5,519 |
| Postdoc 7 or more | $68,604 | $5,717 |
However, if a postdoc is supported by a research grant ® or a career development award (K), they are subject to the NIH salary cap. This means that their salary cannot exceed the prorated portion of the cap based on their percentage of effort on the grant.
For example, if a postdoc with four years of experience has an annual salary of $70,000 and devotes 75% of their effort to an NIH-funded project, their NIH salary cap for 2023 is:
NIH salary cap=70,000×0.75×0.958=50,355
This means that they can charge up to $50,355 of their salary to the grant, and the remaining $19,645 must be paid by other sources.
Why did the NIH salary cap increase in 2023
The NIH salary cap increased in 2023 because Executive Level II of the Federal Executive Pay Scale increased from $203,700 to $212,100. Executive Level II is determined by Congress as part of the annual appropriations process. The increase reflects the adjustments made to account for inflation and changes in the cost of living.
The NIH salary cap has been increasing steadily since it was first imposed in 1990 at $125,900. The table below shows the historical levels of the NIH salary cap since then:
| Fiscal Year | Salary Cap |
|---|---|
| 1990 | $125,900 |
| 1991 | $133,700 |
| 1992 | $141,300 |
| 1993 | $148,400 |
| 1994 | $151,800 |
| 1995 | $154,700 |
| 1996 | $154,700 |
| 1997 | $155,500 |
| 1998 | $157,000 |
| 1999 | $159,200 |
| 2000 | $161,200 |
| 2001 | $166,700 |
| 2002 | $171,900 |
| 2003 | $175,700 |
| 2004 | $179,700 |
| 2005 | $180,100 |
| 2006 | $183,500 |
| 2007 | $186,600 |
| 2008 | $191,300 |
| 2009 | $196,700 |
| 2010 | $199,700 |
| 2011 | $199,700 |
| 2012 | $179,700 |
| 2013 | $179,700 |
| 2014 | $181,500 |
| 2015 | $183,300 |
| 2016 | $185,100 |
| 2017 | $187,000 |
| 2018 | $189,600 |
| 2019 | $192,300 |
| 2020 | $197,300 |
| 2021 | $199,300 |
| 2022 | $203,700 |
| 2023 | $212,100 |
Conclusion
The NIH salary cap is an important factor to consider when applying for or managing an NIH grant. It limits the amount of direct salary that an individual can receive from an NIH-funded project to a percentage of the Executive Level II of the Federal Executive Pay Scale. The NIH salary cap for 2023 has increased from $203,700 to $212,100, effective from January 1, 2023. This means that researchers who are paid above the cap must use other sources of funds to cover the difference. Postdocs who are supported by training grants or fellowship grants are not affected by the salary cap, but those who are supported by research grants or career development awards are. The NIH salary cap has been increasing steadily since it was first imposed in 1990 to reflect inflation and changes in the cost of living.
FAQs
Here are some of the most frequently asked questions and answers about the NIH salary cap:
Q: How do I know if I am subject to the NIH salary cap?
A: You are subject to the NIH salary cap if you are a principal investigator or a key personnel on an NIH grant, cooperative agreement, or contract. You are also subject to the NIH salary cap if you are a postdoc who is supported by a research grant or a career development award.
Q: How do I report my salary and effort on an NIH grant?
A: You must report your salary and effort on an NIH grant using the Personnel Report (PHS2590) or the Research Performance Progress Report (RPPR). You must indicate the percentage of effort that you devote to the project and the amount of salary that you charge to the grant. You must also indicate if your salary exceeds the prorated portion of the cap based on your percentage of effort.
Q: How do I budget for salary increases in future years?
A: You can budget for salary increases in future years by using a reasonable estimate based on your institution’s policy and practice. However, you must ensure that your budget does not exceed the current or projected salary cap for each year. If the salary cap increases in future years, you can request additional funds through a rebudgeting request or an administrative supplement.
Q: What happens if I receive a salary increase that exceeds the NIH salary cap?
A: If you receive a salary increase that exceeds the NIH salary cap, you must adjust your percentage of effort or use other sources of funds to cover the difference. You cannot charge more than the prorated portion of the cap based on your percentage of effort to the grant.
Q: What happens if I reduce my percentage of effort on an NIH grant?
A: If you reduce your percentage of effort on an NIH grant, you must also reduce your salary charged to the grant proportionally. You cannot charge more than the prorated portion of the cap based on your percentage of effort to the grant.
