Horizon 2020 FAQ

A PostDoc researcher is employed part-time on the project and is receiving a salary laid out in his contract. At reporting time, if we calculate his personnel cost by any of the three possible ways laid out in the Grant Agreement, the numbers will not match, because we need to take a closed financial year as a basis. Our institution chooses to use the 1720 working hours/year calculation method (after careful consideration of all three methods), which works well for long-term full-time employees, but it poses problems in the following:

Case A: PostDoc researcher 1 is a case when the actual working hours are higher than the productive hours based on the 1720 method

Case B: PostDoc researcher 2 is a combined case when the actual working hours are lower than the productive hours based on the 1720 method - due to days off; additionally, last year’s lower hourly rate is used.

Of course we will not claim more money than this employee is costing the project and we will sit down and recalculate the same case using the other two methods (institutional average working hours, exact working hours for the employee). How should we deal with this?

Answer:

This question is in fact many questions .In the comment to article 6.2.A.1 in the AGA (Version 5; 3 July 2018) and the “Double ceiling rule”— Beneficiaries must ensure that:

• the total number of hours worked declared in EU and Euratom grants for a person for a year is NOT higher than the number of annual productive hours used for the calculation of the hourly rate
• the total amount of personnel costs declared (for reimbursement as actual costs) in EU and Euratom grants for a person for a year is NOT higher than the total personnel costs recorded in the beneficiary’s accounts (for that person for that year)

Case A: Of course, in projects, researchers never work exactly the same number of hours as the fixed number of annual productive hours (1720) or alternatively the standard annual number of productive hours. Some researchers work more and some less. Therefore, in the presented case where the method of 1720 annual productive hours is chosen, if the researcher works more than 1720 hours, only 1720 workable hours can be charged to the project. If the researcher works less than 1720 hours, the beneficiary can charge the actual number of hours.

Case B: It should be noted that in case b, the calculated hourly rate based on 1720 productive hours is lower than the actual hourly rate. The difference between the real costs incurred and the reported costs must be covered by the beneficiary.

Additionally, in this case you can take in to the consideration that the revised model grant agreement V 3.0 added the possibility to use the hourly rate “per month” which is based on the actual monthly salary costs (instead of the last closed financial year). According to article 6.2 A of AGA (page 64) this calculation method can only be applied with the method:

o    1720 hours for person working full time (monthly hours: 1720 / 12 )

o    the standard number of annual hours (monthly: standard number / 12)

This option may be applied retroactively for all grants on-going (i.e. for which the final report has not been submitted) on 20 July 2016.

Additionally, It should be noted that a beneficiary cannot change the model for the calculation of the hourly rate “ad hoc”, but it can use a different methods for “similar categories of staff” (e.g. type of contract). The “model 3”, which is based on standard annual productive hours, can therefore only be used if standard hours are already established as normal practice in the institution. (Refer to the summary table in the AMGA, Chapter 3. Article 6.2.A.1)

Answer:

In the comment to article 6.2.A.1 in the AGA (Version 5; 3 July 2018) additional remuneration is the financial amount (cost of work) paid to the employee in addition to his/her standard salary. This additional remuneration is paid under certain criteria, which must be auditable. It is an eligible cost only for non-profit organisations (as per Article 2.1(14) of the Rules for Participation Regulation No 1290/2013) under the following conditions:

• Part of the beneficiary’s usual remuneration practices;
• Paid in a consistent manner whenever the same kind of work or expertise is required;
• Paid for the performance of additional work or different expertise than usual tasks; 
• Applied by the beneficiary, regardless of the source of funding used;
• Additional remuneration is eligible up to the following amounts:
  

  1. If the person works full time and exclusively on the project,  during the full year: up to €8000
  2. If the person works exclusively on the project but not full time or not for the full year: up to the corresponding pro-rata of €8000
  3. If the person does not work exclusively on the project: up to a pro-rata of the €8000 calculated as follows:
     (8000€/ the number of annual productive hours) x the number of hours that the person has worked on the project during the year

Additionally, please take in to the consideration following:

•  If additional remuneration is paid to staff only for working in Horizon2020 projects and not for work on any other non-national projects, it will not be eligible
• Additional remuneration is added to costs declared and should not be used in hourly rate calculation. It means, Project budget = (Hourly rate * hours worked on the action) + additional remuneration.
• Additional remuneration is in practice an issue ONLY for case 1B beneficiaries (How to calculate direct personnel costs for employees (or equivalent) according to AGA Version 5; 3 July 2018, page 54). All other beneficiaries will automatically fall under ‘basic remuneration only’ and therefore are not concerned by the provisions on additional remuneration.

Answer:

Yes, this is possible, as long as it is in accordance with the usual accounting practices of the beneficiary. But, if there is no applicable reference for the standard annual workable hours, this option cannot be used. Anyway, the “standard annual productive hours” must be at least 90% of the “standard annual workable hours”. 

For example: In France, 1607 annual workable hours are prescribed by national law. Therefore, the annual productive hours used for the calculation of the hourly rate cannot be less than 1446 h/year (90% of 1607 hours). Every institute should include this in its internal regulations. If a beneficiary deduces “average sick leave” or “general non-productive time” from the workable hours to have low standard hours and thus higher hourly rates, it has to check the 90% rule.

Second example: In Belgium,  “standard annual productive hours” can be calculated on the following way: annual workable hours (contractual 38h/week) – holidays – annual leave – average sick days of the last 3 years. But, at the end 90% rule have to be cheeked.

Answer:

Time sheets should include, as a minimum:

a.     the title and number of the action, as specified in the GA

b.     the beneficiary’s full name, as specified in the GA

c.     the full name, date and signature of the person working for the action

d.     the number of hours worked for the action in the period covered by the time record

e.     the supervisor’s full name and signature

f.      a reference to the action tasks or work packages of Annex 1, to which the person has contributed in the reported working hours.

Information included in time-sheets must match records of annual leave, sick leave, other leaves and work-related travel. In other words: hours declared by researchers for Horizon 2020 projects during their holidays cannot be charged to the project.

A template for time-sheets is available. (This template is not mandatory; beneficiaries may use their own model, provided that it fulfills the minimum conditions and it contains at least the information detailed above.)

If time records are not reliable, the Commission/Agency may exceptionally accept alternative evidence if it proves the number of hours worked on the action with a similar (or at least satisfactory) level of assurance (assessed against generally-accepted audit standards).

Recording other activities (like teaching) that are not necessary for the European project(s) is not required for Horizon 2020, unless the hourly rate is calculated based on individual productive hours. It is best practice if a person works for more than one European project, to record in one single timesheet all projects, to show that the same hours have not been declared for another project.

Answer:

PMs are an indicative value of the effort planned for a task. The AGA does not define to what extent the PMs can be increased, and according to the AGA, generally an increase or decrease of PMs does not require amendment on the Grant Agreement. However, if PMs substantially deviate from the Annex 1, it is strongly recommended that the Principal Investigator notifies the Coordinator and the Project Officer (PO), providing justification for the deviation of PMs and ask to receive a written approval/confirmation from the PO (for e.g. possible EU audits after the project). This is particularly important when the increase of PM is necessary because of unexpected technical difficulties implementing the project, which could hamper their execution. A case that can simply be explained in the period reports is that of senior staff (professors) who had not budgeted their time for the project, but who declare their PM as effort in the activity report (without charging their hours to the project).

Answer:

That depends on the PO and his/her position should be sought and recorded.

Increase of person-months (PMs): What should be considered "substantially deviation" from the Annex 1 in which case is strongly recommended that the Principal Investigator notifies the Coordinator and the Project Officer (PO), providing justification for the deviation of PMs?

Answer:

There is no definition in AGA (Version 5; 3 July 2018). Position of some auditors and projects officers are that 30% would be reasonable. Others are ready to accept up to 20% as acceptable deviation from Annex1. According to this experience, we would recommend always clarifying this with the Project Officer at the EC and ask to receive a written approval/confirmation from the PO (for e.g. possible EU audits after the project).

Answer:

No. The revised AGA (version 5; 3 July 2018) states that Basic remuneration for case 1B beneficiaries (actual costs, project-based remuneration) covers the payments for the employee's participation in the project with the maximum in accordance with the beneficiary’s usual remuneration practices for national projects (which are either set by law or by internal rules).

To calculate remuneration:

1. The beneficiary must first calculate the so-called action reference, which is the hourly rate the employee earned for working on the project.
2. The beneficiary must then calculate the so-called national project reference, which is the hourly rate which the employee can earn for working on a national project based on a national or internal rule. (Please note that the national project reference MUST have been actually paid at least once before the submission of the H2020 proposal for work in a national project! Otherwise it cannot be used.)
3. If the action reference is higher than the national project reference, the exceeding part is additional remuneration. If the action reference is equal or lower than the national project reference, there is no additional remuneration; the remuneration paid to the employee is all basic remuneration.

Additionally, please take in to the consideration following:

• Basic remuneration (salary costs) comes from the books of the beneficiary.
• A calculation is necessary to obtain the hourly rate which is then to be multiplied with the hours worked for the project.

Answer:

Project based remuneration is when an employee’s remuneration depends on whether he/she works on specific projects or not. Non-project based remuneration is when an employee is paid the same remuneration regardless of whether he/she is involved in specific projects or not.

Answer:

The EC has introduced (April 2018) the personnel costs wizard for selected projects on a pilot basis (      The EC has released a guidance note: Version 1.0, 19 April 2018: http://ec.europa.eu/research/participants/data/ref/h2020/other/gm/reporting/guide-personnel-costs_en.pdf ).

The wizard should help beneficiaries through different steps and options to report on personnel costs. At the end of the process, the field in the financial statement will be filled automatically with the amount calculated.

How to use wizard: At first, you select the method of calculation of the hourly rate. Then you are required to enter the details per person (employee) that are needed for the selected method. For the method based on monthly hourly rates each month has to be entered separately.

When filling in the financial report, there is a “wizard stick” icon next to Personnel costs window. The basic information about the project is automatically filled in. Beneficiary can choose between calculation “per full financial year” or “per month”. Then Persons working on the action are to be added. The system asks for information:

-        Work contract type: Employee (or equivalent) / Natural persons working under a direct contract / Seconded personnel (against payment)

-        Person alias

-        Employment Start date

-        Employment end date

-      Annual productive hours option: 1720 fix annual productive hours / Individual annual productive hours / Standard annual productive hours

-        Does the person receive a project-based remuneration? Yes / No

Then the system adds the person on the project, in our case it offered two options: an hourly rate calculation for year 2017 and an hourly rate calculation for 2018. You choose one option and new window appears, asking for (depends on the method of calculation used):

Beneficiary fills out this form for all personnel. 

Is it necessary to show in timesheets 1720 productive hours per year for each person who is involved in the project (for persons who are working full time in my institution)? Our institution uses Option 1: 1720 fixed hours to calculate the hourly rate.

Answer:

No. If you use the 1720 option there is no need to actually have 1720 productive hours in your timesheets. The timesheet shall indicate the hours that have been worked on the project on the given day (or week) in an auditable way. If the researchers worked more than 1720 hours on the project, the timesheets will indicate more hours. If they worked less, the lower figure will appear. In case of an EC audit, the auditors may ask to see evidence for the declared hours on a given day. If the auditors are not convinced that the time recording is reliable, they may require alternative evidence.

1720 is a fixed number used to calculate your hourly rate; your actual productive hours in the timesheets are used to calculate the total personnel cost to claim.

A PostDoc researcher is employed part-time on the project and is receiving a salary laid out in his contract. At reporting time, if we calculate his personnel cost by any of the three possible ways laid out in the Grant Agreement, the numbers will not match, because we need to take a closed financial year as a basis. Our institution chooses to use the 1720 working hours/year calculation method (after careful consideration of all three methods), which works well for long-term full-time employees, but it poses problems in the following:

Case A: PostDoc researcher 1 is a case when the actual working hours are higher than the productive hours based on the 1720 method

Case B: PostDoc researcher 2 is a combined case when the actual working hours are lower than the productive hours based on the 1720 method - due to days off; additionally, last year’s lower hourly rate is used.

Of course we will not claim more money than this employee is costing the project and we will sit down and recalculate the same case using the other two methods (institutional average working hours, exact working hours for the employee). How should we deal with this?

Answer:

This question is in fact many questions .In the comment to article 6.2.A.1 in the AGA (Version 5; 3 July 2018) and the “Double ceiling rule”— Beneficiaries must ensure that:

• the total number of hours worked declared in EU and Euratom grants for a person for a year is NOT higher than the number of annual productive hours used for the calculation of the hourly rate
• the total amount of personnel costs declared (for reimbursement as actual costs) in EU and Euratom grants for a person for a year is NOT higher than the total personnel costs recorded in the beneficiary’s accounts (for that person for that year)

Case A: Of course, in projects, researchers never work exactly the same number of hours as the fixed number of annual productive hours (1720) or alternatively the standard annual number of productive hours. Some researchers work more and some less. Therefore, in the presented case where the method of 1720 annual productive hours is chosen, if the researcher works more than 1720 hours, only 1720 workable hours can be charged to the project. If the researcher works less than 1720 hours, the beneficiary can charge the actual number of hours.

Case B: It should be noted that in case b, the calculated hourly rate based on 1720 productive hours is lower than the actual hourly rate. The difference between the real costs incurred and the reported costs must be covered by the beneficiary.

Additionally, in this case you can take in to the consideration that the revised model grant agreement V 3.0 added the possibility to use the hourly rate “per month” which is based on the actual monthly salary costs (instead of the last closed financial year). According to article 6.2 A of AGA (page 64) this calculation method can only be applied with the method:

o    1720 hours for person working full time (monthly hours: 1720 / 12 )

o    the standard number of annual hours (monthly: standard number / 12)

This option may be applied retroactively for all grants on-going (i.e. for which the final report has not been submitted) on 20 July 2016.

Additionally, It should be noted that a beneficiary cannot change the model for the calculation of the hourly rate “ad hoc”, but it can use a different methods for “similar categories of staff” (e.g. type of contract). The “model 3”, which is based on standard annual productive hours, can therefore only be used if standard hours are already established as normal practice in the institution. (Refer to the summary table in the AMGA, Chapter 3. Article 6.2.A.1)

Answer:

In the comment to article 6.2.A.1 in the AGA (Version 5; 3 July 2018) additional remuneration is the financial amount (cost of work) paid to the employee in addition to his/her standard salary. This additional remuneration is paid under certain criteria, which must be auditable. It is an eligible cost only for non-profit organisations (as per Article 2.1(14) of the Rules for Participation Regulation No 1290/2013) under the following conditions:

• Part of the beneficiary’s usual remuneration practices;
• Paid in a consistent manner whenever the same kind of work or expertise is required;
• Paid for the performance of additional work or different expertise than usual tasks; 
• Applied by the beneficiary, regardless of the source of funding used;
• Additional remuneration is eligible up to the following amounts:
  

  1. If the person works full time and exclusively on the project,  during the full year: up to €8000
  2. If the person works exclusively on the project but not full time or not for the full year: up to the corresponding pro-rata of €8000
  3. If the person does not work exclusively on the project: up to a pro-rata of the €8000 calculated as follows:
     (8000€/ the number of annual productive hours) x the number of hours that the person has worked on the project during the year

Additionally, please take in to the consideration following:

•  If additional remuneration is paid to staff only for working in Horizon2020 projects and not for work on any other non-national projects, it will not be eligible
• Additional remuneration is added to costs declared and should not be used in hourly rate calculation. It means, Project budget = (Hourly rate * hours worked on the action) + additional remuneration.
• Additional remuneration is in practice an issue ONLY for case 1B beneficiaries (How to calculate direct personnel costs for employees (or equivalent) according to AGA Version 5; 3 July 2018, page 54). All other beneficiaries will automatically fall under ‘basic remuneration only’ and therefore are not concerned by the provisions on additional remuneration.

Answer:

Yes, this is possible, as long as it is in accordance with the usual accounting practices of the beneficiary. But, if there is no applicable reference for the standard annual workable hours, this option cannot be used. Anyway, the “standard annual productive hours” must be at least 90% of the “standard annual workable hours”. 

For example: In France, 1607 annual workable hours are prescribed by national law. Therefore, the annual productive hours used for the calculation of the hourly rate cannot be less than 1446 h/year (90% of 1607 hours). Every institute should include this in its internal regulations. If a beneficiary deduces “average sick leave” or “general non-productive time” from the workable hours to have low standard hours and thus higher hourly rates, it has to check the 90% rule.

Second example: In Belgium,  “standard annual productive hours” can be calculated on the following way: annual workable hours (contractual 38h/week) – holidays – annual leave – average sick days of the last 3 years. But, at the end 90% rule have to be cheeked.

Answer:

Time sheets should include, as a minimum:

a.     the title and number of the action, as specified in the GA

b.     the beneficiary’s full name, as specified in the GA

c.     the full name, date and signature of the person working for the action

d.     the number of hours worked for the action in the period covered by the time record

e.     the supervisor’s full name and signature

f.      a reference to the action tasks or work packages of Annex 1, to which the person has contributed in the reported working hours.

Information included in time-sheets must match records of annual leave, sick leave, other leaves and work-related travel. In other words: hours declared by researchers for Horizon 2020 projects during their holidays cannot be charged to the project.

A template for time-sheets is available. (This template is not mandatory; beneficiaries may use their own model, provided that it fulfills the minimum conditions and it contains at least the information detailed above.)

If time records are not reliable, the Commission/Agency may exceptionally accept alternative evidence if it proves the number of hours worked on the action with a similar (or at least satisfactory) level of assurance (assessed against generally-accepted audit standards).

Recording other activities (like teaching) that are not necessary for the European project(s) is not required for Horizon 2020, unless the hourly rate is calculated based on individual productive hours. It is best practice if a person works for more than one European project, to record in one single timesheet all projects, to show that the same hours have not been declared for another project.

Answer:

PMs are an indicative value of the effort planned for a task. The AGA does not define to what extent the PMs can be increased, and according to the AGA, generally an increase or decrease of PMs does not require amendment on the Grant Agreement. However, if PMs substantially deviate from the Annex 1, it is strongly recommended that the Principal Investigator notifies the Coordinator and the Project Officer (PO), providing justification for the deviation of PMs and ask to receive a written approval/confirmation from the PO (for e.g. possible EU audits after the project). This is particularly important when the increase of PM is necessary because of unexpected technical difficulties implementing the project, which could hamper their execution. A case that can simply be explained in the period reports is that of senior staff (professors) who had not budgeted their time for the project, but who declare their PM as effort in the activity report (without charging their hours to the project).

Answer:

That depends on the PO and his/her position should be sought and recorded.

Increase of person-months (PMs): What should be considered "substantially deviation" from the Annex 1 in which case is strongly recommended that the Principal Investigator notifies the Coordinator and the Project Officer (PO), providing justification for the deviation of PMs?

Answer:

There is no definition in AGA (Version 5; 3 July 2018). Position of some auditors and projects officers are that 30% would be reasonable. Others are ready to accept up to 20% as acceptable deviation from Annex1. According to this experience, we would recommend always clarifying this with the Project Officer at the EC and ask to receive a written approval/confirmation from the PO (for e.g. possible EU audits after the project).

Answer:

No. The revised AGA (version 5; 3 July 2018) states that Basic remuneration for case 1B beneficiaries (actual costs, project-based remuneration) covers the payments for the employee's participation in the project with the maximum in accordance with the beneficiary’s usual remuneration practices for national projects (which are either set by law or by internal rules).

To calculate remuneration:

1. The beneficiary must first calculate the so-called action reference, which is the hourly rate the employee earned for working on the project.
2. The beneficiary must then calculate the so-called national project reference, which is the hourly rate which the employee can earn for working on a national project based on a national or internal rule. (Please note that the national project reference MUST have been actually paid at least once before the submission of the H2020 proposal for work in a national project! Otherwise it cannot be used.)
3. If the action reference is higher than the national project reference, the exceeding part is additional remuneration. If the action reference is equal or lower than the national project reference, there is no additional remuneration; the remuneration paid to the employee is all basic remuneration.

Additionally, please take in to the consideration following:

• Basic remuneration (salary costs) comes from the books of the beneficiary.
• A calculation is necessary to obtain the hourly rate which is then to be multiplied with the hours worked for the project.

Answer:

Project based remuneration is when an employee’s remuneration depends on whether he/she works on specific projects or not. Non-project based remuneration is when an employee is paid the same remuneration regardless of whether he/she is involved in specific projects or not.

Answer:

The EC has introduced (April 2018) the personnel costs wizard for selected projects on a pilot basis (      The EC has released a guidance note: Version 1.0, 19 April 2018: http://ec.europa.eu/research/participants/data/ref/h2020/other/gm/reporting/guide-personnel-costs_en.pdf ).

The wizard should help beneficiaries through different steps and options to report on personnel costs. At the end of the process, the field in the financial statement will be filled automatically with the amount calculated.

How to use wizard: At first, you select the method of calculation of the hourly rate. Then you are required to enter the details per person (employee) that are needed for the selected method. For the method based on monthly hourly rates each month has to be entered separately.

When filling in the financial report, there is a “wizard stick” icon next to Personnel costs window. The basic information about the project is automatically filled in. Beneficiary can choose between calculation “per full financial year” or “per month”. Then Persons working on the action are to be added. The system asks for information:

-        Work contract type: Employee (or equivalent) / Natural persons working under a direct contract / Seconded personnel (against payment)

-        Person alias

-        Employment Start date

-        Employment end date

-      Annual productive hours option: 1720 fix annual productive hours / Individual annual productive hours / Standard annual productive hours

-        Does the person receive a project-based remuneration? Yes / No

Then the system adds the person on the project, in our case it offered two options: an hourly rate calculation for year 2017 and an hourly rate calculation for 2018. You choose one option and new window appears, asking for (depends on the method of calculation used):

Beneficiary fills out this form for all personnel. 

Is it necessary to show in timesheets 1720 productive hours per year for each person who is involved in the project (for persons who are working full time in my institution)? Our institution uses Option 1: 1720 fixed hours to calculate the hourly rate.

Answer:

No. If you use the 1720 option there is no need to actually have 1720 productive hours in your timesheets. The timesheet shall indicate the hours that have been worked on the project on the given day (or week) in an auditable way. If the researchers worked more than 1720 hours on the project, the timesheets will indicate more hours. If they worked less, the lower figure will appear. In case of an EC audit, the auditors may ask to see evidence for the declared hours on a given day. If the auditors are not convinced that the time recording is reliable, they may require alternative evidence.

1720 is a fixed number used to calculate your hourly rate; your actual productive hours in the timesheets are used to calculate the total personnel cost to claim.

A PostDoc researcher is employed part-time on the project and is receiving a salary laid out in his contract. At reporting time, if we calculate his personnel cost by any of the three possible ways laid out in the Grant Agreement, the numbers will not match, because we need to take a closed financial year as a basis. Our institution chooses to use the 1720 working hours/year calculation method (after careful consideration of all three methods), which works well for long-term full-time employees, but it poses problems in the following:

Case A: PostDoc researcher 1 is a case when the actual working hours are higher than the productive hours based on the 1720 method

Case B: PostDoc researcher 2 is a combined case when the actual working hours are lower than the productive hours based on the 1720 method - due to days off; additionally, last year’s lower hourly rate is used.

Of course we will not claim more money than this employee is costing the project and we will sit down and recalculate the same case using the other two methods (institutional average working hours, exact working hours for the employee). How should we deal with this?

Answer:

This question is in fact many questions .In the comment to article 6.2.A.1 in the AGA (Version 5; 3 July 2018) and the “Double ceiling rule”— Beneficiaries must ensure that:

• the total number of hours worked declared in EU and Euratom grants for a person for a year is NOT higher than the number of annual productive hours used for the calculation of the hourly rate
• the total amount of personnel costs declared (for reimbursement as actual costs) in EU and Euratom grants for a person for a year is NOT higher than the total personnel costs recorded in the beneficiary’s accounts (for that person for that year)

Case A: Of course, in projects, researchers never work exactly the same number of hours as the fixed number of annual productive hours (1720) or alternatively the standard annual number of productive hours. Some researchers work more and some less. Therefore, in the presented case where the method of 1720 annual productive hours is chosen, if the researcher works more than 1720 hours, only 1720 workable hours can be charged to the project. If the researcher works less than 1720 hours, the beneficiary can charge the actual number of hours.

Case B: It should be noted that in case b, the calculated hourly rate based on 1720 productive hours is lower than the actual hourly rate. The difference between the real costs incurred and the reported costs must be covered by the beneficiary.

Additionally, in this case you can take in to the consideration that the revised model grant agreement V 3.0 added the possibility to use the hourly rate “per month” which is based on the actual monthly salary costs (instead of the last closed financial year). According to article 6.2 A of AGA (page 64) this calculation method can only be applied with the method:

o    1720 hours for person working full time (monthly hours: 1720 / 12 )

o    the standard number of annual hours (monthly: standard number / 12)

This option may be applied retroactively for all grants on-going (i.e. for which the final report has not been submitted) on 20 July 2016.

Additionally, It should be noted that a beneficiary cannot change the model for the calculation of the hourly rate “ad hoc”, but it can use a different methods for “similar categories of staff” (e.g. type of contract). The “model 3”, which is based on standard annual productive hours, can therefore only be used if standard hours are already established as normal practice in the institution. (Refer to the summary table in the AMGA, Chapter 3. Article 6.2.A.1)

Answer:

In the comment to article 6.2.A.1 in the AGA (Version 5; 3 July 2018) additional remuneration is the financial amount (cost of work) paid to the employee in addition to his/her standard salary. This additional remuneration is paid under certain criteria, which must be auditable. It is an eligible cost only for non-profit organisations (as per Article 2.1(14) of the Rules for Participation Regulation No 1290/2013) under the following conditions:

• Part of the beneficiary’s usual remuneration practices;
• Paid in a consistent manner whenever the same kind of work or expertise is required;
• Paid for the performance of additional work or different expertise than usual tasks; 
• Applied by the beneficiary, regardless of the source of funding used;
• Additional remuneration is eligible up to the following amounts:
  

  1. If the person works full time and exclusively on the project,  during the full year: up to €8000
  2. If the person works exclusively on the project but not full time or not for the full year: up to the corresponding pro-rata of €8000
  3. If the person does not work exclusively on the project: up to a pro-rata of the €8000 calculated as follows:
     (8000€/ the number of annual productive hours) x the number of hours that the person has worked on the project during the year

Additionally, please take in to the consideration following:

•  If additional remuneration is paid to staff only for working in Horizon2020 projects and not for work on any other non-national projects, it will not be eligible
• Additional remuneration is added to costs declared and should not be used in hourly rate calculation. It means, Project budget = (Hourly rate * hours worked on the action) + additional remuneration.
• Additional remuneration is in practice an issue ONLY for case 1B beneficiaries (How to calculate direct personnel costs for employees (or equivalent) according to AGA Version 5; 3 July 2018, page 54). All other beneficiaries will automatically fall under ‘basic remuneration only’ and therefore are not concerned by the provisions on additional remuneration.

Answer:

Yes, this is possible, as long as it is in accordance with the usual accounting practices of the beneficiary. But, if there is no applicable reference for the standard annual workable hours, this option cannot be used. Anyway, the “standard annual productive hours” must be at least 90% of the “standard annual workable hours”. 

For example: In France, 1607 annual workable hours are prescribed by national law. Therefore, the annual productive hours used for the calculation of the hourly rate cannot be less than 1446 h/year (90% of 1607 hours). Every institute should include this in its internal regulations. If a beneficiary deduces “average sick leave” or “general non-productive time” from the workable hours to have low standard hours and thus higher hourly rates, it has to check the 90% rule.

Second example: In Belgium,  “standard annual productive hours” can be calculated on the following way: annual workable hours (contractual 38h/week) – holidays – annual leave – average sick days of the last 3 years. But, at the end 90% rule have to be cheeked.

Answer:

Time sheets should include, as a minimum:

a.     the title and number of the action, as specified in the GA

b.     the beneficiary’s full name, as specified in the GA

c.     the full name, date and signature of the person working for the action

d.     the number of hours worked for the action in the period covered by the time record

e.     the supervisor’s full name and signature

f.      a reference to the action tasks or work packages of Annex 1, to which the person has contributed in the reported working hours.

Information included in time-sheets must match records of annual leave, sick leave, other leaves and work-related travel. In other words: hours declared by researchers for Horizon 2020 projects during their holidays cannot be charged to the project.

A template for time-sheets is available. (This template is not mandatory; beneficiaries may use their own model, provided that it fulfills the minimum conditions and it contains at least the information detailed above.)

If time records are not reliable, the Commission/Agency may exceptionally accept alternative evidence if it proves the number of hours worked on the action with a similar (or at least satisfactory) level of assurance (assessed against generally-accepted audit standards).

Recording other activities (like teaching) that are not necessary for the European project(s) is not required for Horizon 2020, unless the hourly rate is calculated based on individual productive hours. It is best practice if a person works for more than one European project, to record in one single timesheet all projects, to show that the same hours have not been declared for another project.

Answer:

PMs are an indicative value of the effort planned for a task. The AGA does not define to what extent the PMs can be increased, and according to the AGA, generally an increase or decrease of PMs does not require amendment on the Grant Agreement. However, if PMs substantially deviate from the Annex 1, it is strongly recommended that the Principal Investigator notifies the Coordinator and the Project Officer (PO), providing justification for the deviation of PMs and ask to receive a written approval/confirmation from the PO (for e.g. possible EU audits after the project). This is particularly important when the increase of PM is necessary because of unexpected technical difficulties implementing the project, which could hamper their execution. A case that can simply be explained in the period reports is that of senior staff (professors) who had not budgeted their time for the project, but who declare their PM as effort in the activity report (without charging their hours to the project).

Answer:

That depends on the PO and his/her position should be sought and recorded.

Increase of person-months (PMs): What should be considered "substantially deviation" from the Annex 1 in which case is strongly recommended that the Principal Investigator notifies the Coordinator and the Project Officer (PO), providing justification for the deviation of PMs?

Answer:

There is no definition in AGA (Version 5; 3 July 2018). Position of some auditors and projects officers are that 30% would be reasonable. Others are ready to accept up to 20% as acceptable deviation from Annex1. According to this experience, we would recommend always clarifying this with the Project Officer at the EC and ask to receive a written approval/confirmation from the PO (for e.g. possible EU audits after the project).

Answer:

No. The revised AGA (version 5; 3 July 2018) states that Basic remuneration for case 1B beneficiaries (actual costs, project-based remuneration) covers the payments for the employee's participation in the project with the maximum in accordance with the beneficiary’s usual remuneration practices for national projects (which are either set by law or by internal rules).

To calculate remuneration:

1. The beneficiary must first calculate the so-called action reference, which is the hourly rate the employee earned for working on the project.
2. The beneficiary must then calculate the so-called national project reference, which is the hourly rate which the employee can earn for working on a national project based on a national or internal rule. (Please note that the national project reference MUST have been actually paid at least once before the submission of the H2020 proposal for work in a national project! Otherwise it cannot be used.)
3. If the action reference is higher than the national project reference, the exceeding part is additional remuneration. If the action reference is equal or lower than the national project reference, there is no additional remuneration; the remuneration paid to the employee is all basic remuneration.

Additionally, please take in to the consideration following:

• Basic remuneration (salary costs) comes from the books of the beneficiary.
• A calculation is necessary to obtain the hourly rate which is then to be multiplied with the hours worked for the project.

Answer:

Project based remuneration is when an employee’s remuneration depends on whether he/she works on specific projects or not. Non-project based remuneration is when an employee is paid the same remuneration regardless of whether he/she is involved in specific projects or not.

Answer:

The EC has introduced (April 2018) the personnel costs wizard for selected projects on a pilot basis (      The EC has released a guidance note: Version 1.0, 19 April 2018: http://ec.europa.eu/research/participants/data/ref/h2020/other/gm/reporting/guide-personnel-costs_en.pdf ).

The wizard should help beneficiaries through different steps and options to report on personnel costs. At the end of the process, the field in the financial statement will be filled automatically with the amount calculated.

How to use wizard: At first, you select the method of calculation of the hourly rate. Then you are required to enter the details per person (employee) that are needed for the selected method. For the method based on monthly hourly rates each month has to be entered separately.

When filling in the financial report, there is a “wizard stick” icon next to Personnel costs window. The basic information about the project is automatically filled in. Beneficiary can choose between calculation “per full financial year” or “per month”. Then Persons working on the action are to be added. The system asks for information:

-        Work contract type: Employee (or equivalent) / Natural persons working under a direct contract / Seconded personnel (against payment)

-        Person alias

-        Employment Start date

-        Employment end date

-      Annual productive hours option: 1720 fix annual productive hours / Individual annual productive hours / Standard annual productive hours

-        Does the person receive a project-based remuneration? Yes / No

Then the system adds the person on the project, in our case it offered two options: an hourly rate calculation for year 2017 and an hourly rate calculation for 2018. You choose one option and new window appears, asking for (depends on the method of calculation used):

Beneficiary fills out this form for all personnel. 

Is it necessary to show in timesheets 1720 productive hours per year for each person who is involved in the project (for persons who are working full time in my institution)? Our institution uses Option 1: 1720 fixed hours to calculate the hourly rate.

Answer:

No. If you use the 1720 option there is no need to actually have 1720 productive hours in your timesheets. The timesheet shall indicate the hours that have been worked on the project on the given day (or week) in an auditable way. If the researchers worked more than 1720 hours on the project, the timesheets will indicate more hours. If they worked less, the lower figure will appear. In case of an EC audit, the auditors may ask to see evidence for the declared hours on a given day. If the auditors are not convinced that the time recording is reliable, they may require alternative evidence.

1720 is a fixed number used to calculate your hourly rate; your actual productive hours in the timesheets are used to calculate the total personnel cost to claim.