4) What is the difference between the Budgeted Salary, the FTE Salary, the Optional Life Salary and the Benefit Salary?
The Budgeted Salary is generally defined as being the salary the employee will receive during the fiscal year.
The FTE Salary is the salary that would be paid if the employee is paid full time (100% effort) over 12 months.
* For most staff employees, the Budgeted salary & FTE Salary values are the same. Faculty and Part-timers will be different.
The Optional life salary is used to calculate the coverage amounts for Optional Life and Alternate Basic Life Insurance coverage. It is the annualized salary as of the 1st of the current fiscal year or when newly hired. It is calculated by multiplying the FTE salary times the percent effort. It is not adjusted by mid-year salary changes and is never decreased. In processing OL-SAL, the greater of the current OL-SAL or the FTE Salary is multiplied by the percent of effort.
The Benefit Salary is used to set coverage for ADD and LTD. The Benefit Salary is defined as the Budgeted Salary, as of September 1st of each year, OR the previous Benefit Salary, whichever is greatest. Should an employee’s actual salary change during the fiscal year, the benefit salary should stay the same until the next calculation period (September 1st of each year).
Example 1: A nine-month faculty member being paid $1,000 per month:
$1000 / month * 9 months * 100%=$9000 Budgeted Salary
$1000 / month * 12 months * 100%=$12,000 FTE or annualized Salary
$12,000 * 100% = $12,000 Optional Life Salary
Example 2: An employee that is budgeted for 12 months, but only works 50% time with a full time salary of $1000 per month:
$1000 / month * 12 months * 50%=$6000 Budgeted Salary
$1000 / month * 12 months * 100%=$12,000 FTE or annualized Salary
$12,000 * 50%=$6000 Optional Life Salary ($12,000 is used because it is the greater of the two)
This page was last updated on 04/20/2012 2:50