Talking about salaries

Commonwealth Bank of Australia ten-shilling note, showing both sides of the note
Commonwealth Bank of Australia ten-shilling note, via Wikimedia.

At universities in Australia, we get used to knowing one another’s salaries (in rough terms). Every university uses the same basic salary structure, and has relatively comparable pay rates within that structure. So, if someone is a Professor or a Lecturer, you know roughly how much they earn.

This familiarity means that we often forget that this isn’t the case in all sectors. A friend who worked in the IT sector said that he worked for an organisation where it was a sackable offence to discuss your salary with a colleague. Everybody was on negotiated rates, and the last thing that management wanted was for workers to compare their pay rates, especially if they were doing the same work.

That isn’t really a problem until you want to include an industry partner in the budget of an application. Then these differences can be tricky to talk about.

For many grants, the time that partners contribute to a project can be counted as an in-kind contribution towards the project. This is terrific, as it demonstrates their commitment to the project, and it shows that the funder is getting good value for their funding.

Examples of time that might sometimes be included could be:

  • Time spent working directly on the project – this is pretty rare, and precious when it happens.
  • Time spent working with Chief Investigators. Often this includes meetings, touring facilities, introductions to staff, assisting with understanding data, etc.
  • Time spent working with (or being external supervisor to) post-graduates or post-doctoral researchers.
  • Time spent attending project meetings, and the travel time to get to those meetings.

This means that the in-kind support from industry partners can quickly mount up, particularly if an owner, CEO or high level manager is involved. That isn’t a problem. It needs to be clearly explained and justified, but it is a good thing, not a bad thing. It shows a strong commitment to the project from the project partner.

In many grant applications, we need to spell out the in-kind commitment in dollar terms in the budget. It can’t be just a statement of hours – it has to have a figure attached. This is particularly true for applications where there is matching funding. You are receiving grant funding based on the amount of cash and in-kind that partners are contributing to the project.

The standard way to cost staff time is:

  • Hourly salary (including salary on-costs) x hours committed = in-kind commitment of that person.

That all works well until you need to ask someone what their salary is. Sometimes, academics are a bit shy about asking industry partners about their salaries. This might be because the relationship is relatively new, and you haven’t reached the level of trust required to discuss these things. It might be because there is a power-differential, and a relatively junior academic may not feel that they can ask a high-powered executive for such information. Or it might be cultural – different cultures have different ways of talking about salaries.

Sometimes, industry partners aren’t too keen to reveal their personal salaries to strangers. Sometimes they may not be allowed to, due to clauses in their employment contact. There are a couple of ways that could deal with this.

  1. Agree on the time commitment and have the industry partner calculate the result. This is a polite way to not have to talk about the salary directly.
  2. If the industry partner doesn’t want to reveal their salary, then you could talk about an indicative salary. For example, “This in-kind amount is calculated using an indicative salary for the CEO of a business of this size, excluding performance bonuses and returns from shares.” This allows the industry partner to set a lower salary than their actual salary, which protects their privacy and mitigates the risk of breaching their contract provisions.

In some ways, it doesn’t matter what the figure is, as long as it is reasonable (given the industry sector involved) and it is well justified. On the whole, reviewers and funders are happy to see strong levels of commitment when they are clearly explained.

There are two main exceptions:

  • Discourage your partners from promising a high level of involvement, just to look good in the application. That won’t help if they are likely to renege, for whatever reason, when the grant is awarded.
  • Often assessors will be knowledgeable in the industry sector, and can question an unrealistic levels of commitment. That is, levels that seem either too high or too low may be questioned by the assessors.

When you are justifying partner commitments, there are several places that you might talk about them:

  • In the project description, there should be a clear description of what involvement and responsibilities the industry personnel will have in the project.
  • Depending on the guidelines for the particular scheme, their contribution should be listed as a dollar amount of in-kind support in the project budget.
  • In the budget justification, that in-kind contribution must be briefly and clearly justified. That should include a brief reference back to what they will be doing in the project, as well as an indication of how the figures were calculated. If the actual salary hasn’t been used in the calculation, say why a lower amount has been used (see my suggestion above), and make it very clear what the contribution will be. There should be no confusion in the mind of the reader as to what is going on, and what the purpose of that person’s involvement will bring to the project.
  • Some schemes require a support letter from partners or a description of the partner organisation. Some require partners to provide a CV. In any of these cases, reiterate what the contribution will be, and how it will be of assistance to the organisation and/or the individual.

In justifying the partner commitment, make it clear what the value is to them, as well as what their value is the project. Link it to their overall strategic plan, if that make sense. Partners are rarely contributing their time out of the goodness of their hearts. Knowing how your research can help their organisation, and can help them to achieve their key performance indicators (KPIs) can help readers to understand their commitment to the project, and can help you when you are discussing the project with them.

Finally, be sensitive, but don’t be shy, when asking about salaries. Norms can vary between organisations within the same industry sector, between different industry sectors and between countries. It will also vary between individuals.

Being able to address this issue in a matter-of-fact way, and knowing what the norms are for the organisations that you are dealing with, is a sign of a mature research relationship. Be sensitive to their requirements, and work together to find a way to provide the information that makes sense to the funder, and respects the requirements of your partner. Sometimes, that will be tricky but, often, it will be simpler than you think.

About Jonathan O'Donnell
Jonathan O'Donnell helps people get funding for their research. To be specific, he helps the people in the Faculty of Science at the University of Melbourne in Australia. All opinions are his own. He has been doing that, on and off, since the 1990's (with varying degrees of success). He loves his job. He loves it so much that he has enrolled in a PhD to look at crowdfunding for research. With Tseen Khoo, he runs the Research Whisperer blog and @ResearchWhisper Twitter stream, about doing research in academia. His ORCID is 0000-0001-5435-235X. The views expressed here are his personal views and are not the views of the University of Melbourne.

2 Responses to Talking about salaries

  1. Frank Carver says:

    Salary may not actually be the figure you need, here. In the UK IT industry it’s common for staff to have a “charge out” rate which bundles up not just salary but all the other costs to the company of employing that person, including taxes, office space, management and admin overhead, a proportion of shared resources, etc.. This rate is usually used when a member of staff does work for a financially separate department or for another group company. Collaborating on a research project would seem to fit this model. A calculation based on salary alone seems naive.

    Liked by 1 person

    • Jonathan O'Donnell says:

      Good point, Frank. You are correct. Another good reason to ask the partner to provide the costing.

      Like

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