The new daily rate methodology for calculating personnel costs under Horizon Europe can include additional payments made for the participation in projects above the beneficiary's usual remuneration practice for national projects.
Known as 'Project-based remuneration' under Horizon 2020 (and applicable mainly to beneficiaries in Central and Eastern European Countries such as Poland and Romania), these supplementary payments increase the total remuneration of the employee over a calendar year.
This 'Supplementary Payment' is applied irrespectively of the number of projects for which the employee receives a higher salary or the source of funding of those projects as outlined in the draft Horizon Europe Model Grant Agreement. A key difference from Horizon 2020, is that there will no longer be an obligation for the supplementary payment for work on a nationally-funded project to have been paid at least once prior to the submission of a proposal in Horizon Europe.
For personnel that receives supplementary payments for work in projects (project-based remuneration), the personnel costs must be calculated at a rate which:
- Corresponds to the actual remuneration costs paid by the beneficiary for the time worked by the person in the action over the reporting period.
- Does not exceed the remuneration costs paid by the beneficiary for work in similar projects funded by national schemes ('national projects reference').
- Is defined based on objective criteria allowing to determine the amount to which the person is entitled.
- Reflects the usual practice of the beneficiary to pay consistently bonuses or supplementary payments for work in projects funded by national schemes.
The remuneration to which the person would be entitled to if they worked in national projects must be defined in either:
- regulatory requirements (such as national law or collective labour agreements); or
- the beneficiary's internal remuneration rules.
If the beneficiary has no regulatory requirements or internal rules defining objective conditions on which the national projects' daily rate can be determined, but it is able to demonstrate that their usual practice is to pay bonuses for work on national projects, the national project reference will be the average remuneration of the person in the last full calendar year covered by the reporting period, excluding remuneration paid for work in EU actions.
As detailed in the Commission webinar last October, beneficiaries will need to compare the action's daily rate with what they would pay to the person for work in national projects in accordance with their usual remuneration practices (national projects daily rate) and the daily rate eligible for declaring personnel costs will be the lower of the two.
The daily rate must be calculated using the following methodology:
- Actual personnel costs of the person for her/his work in the action over the calendar year divided by days worked by the person in the action over the calendar year.
The national projects' daily rate must be calculated as follows:
- Monthly personnel costs for the person based on the remuneration which the person would be entitled to for work in national projects multiplied by 12, then divided by 215.
If the beneficiary's usual cost accounting practices is to use average personnel costs (unit cost), the personnel costs must fulfil the general eligibility conditions for such unit costs and the daily rate must be calculated as follows:
- Using the actual personnel costs recorded in the beneficiary's accounts and excluding any costs which are ineligible or already included in other budget categories.
- The actual personnel costs may be adjusted on the basis of budgeted or estimated elements, if they are relevant for calculating the personnel costs, reasonable and correspond to objective and verifiable information.
- And according to usual cost accounting practices which are applied in a consistent manner, based on objective criteria, regardless of the source of funding.