Will departments be expected to cover the usual employer’s portion of the fringe benefits rate for the Achievement and Spot Award payment that is made to the employee?

Yes, the University-paid fringe benefits rate will be charged to the units. Due to varying amounts for Recognition Awards, units should calculate the full costs of the award which includes the 38% Fringe Benefits Rate. These costs will be charged to the same fund as the Achievement and Spot Awards. Departments should use 38% of the planned award amount to calculate this cost.  For example, for a $400 Spot Award, $552 should be reserved in the fund to cover the unit cost and for a $2,000 Achievement Award, $2,760 should be reserved to cover the unit cost.

In the examples above, the actual award made to the employee would be $400 (less taxes) and $2,000 (less taxes) respectively. In other words, awards should not be grossed up.