At VCU we have had problems over the years with severance pay.

We are a state insititution.  Individuals may move freely from "state line"
(state tax appropriations) positions to "grant" (sponsored) positions.  All
are state employees.  By state personnel regulations, unused sick and
annual leave accrue (with limits) and must be paid on termination of state
employment.  Furthermore, the employee's accrued balances move with her as
she moves to a new position.  It is because this is consistent throughout
the state personnel system that A-21 is interpreted to allow these costs.

Normally, there is no reason to plan/budget to pay such expenses.  But you
do have to pay it if the situation arises.

A couple of practices to minimize the impace -- call for pre-planning that
is all too infrequent.
1)      Require that all "grant" employees take leave in the period they earned
it, or loose it.  Downside:  supervisor often forgets that the leave is
EARNED and the employee needs to take it, and deserves significant
consideration as to her wishes for dates.
2)      Require each PI to consider terminations costs each time she hires a
person.
3)      If the person has worked on a very long term project for years, then
maybe the program people at the sponsor will pony up more $ for
terminations costs.

BUT think it through -- if you have to pay termination costs, you have
worked the employee more intensely than the employment contract called for.
 Who got the benefit of that work?  Can you make them pay?

Of course the total solution is a payroll/costing system that charges
projects for "productive hours" and accumulates the accrued leave cash in
another account, which is charged when leave is taken.  A common commercial
accounting practice, but unusual in a non-profit setting.

Chuck

At 08:03 AM 10/27/98 CST, you wrote:
>I have a question about severance pay in grant proposals.  The Director of
our
>Student Support Services grant retired and our Budget Director is saying
>severance pay -- a significant amount of money -- must come out of grant
funds.
>  The feds have told her this is an allowable expense.  This may have a
>devastating effect on the grant project.  My actual question, however, is:  I
>have never heard of including severance pay in an original grant proposal.
 Has
> anyone out there done this?
>
>Nancy Kay Peterson
>Director of Grants
>Somsen Hall, Room 202-C
>Winona State University
>Winona, MN  55987
>Phone:  507/457-5519
>FAX:       507/457-2415
>email:    xxxxxx@winona.msus.edu
>Web:     http://www.winona.msus.edu/grants/index.html
>
Herbert B. Chermside, CRA
Director, Sponsored Programs Administration
Virginia Comonwealth University
PO BOX 980568
Richmond, VA  23298-0568
Express Delivery Only:
        Sanger Hall, Rm. 1-073
        11th & Marshall Streets
        Richmond, VA  23219
Voice:  804-828-6772
Fax     804-828-2521
OFFICE e-mail   xxxxxx@VCU.EDU
Personal e-mail xxxxxx@vcu.edu
http://views.vcu.edu/views/ospa/