Staff costs

Staff costs must be related to the project activities and the responsibilities of the staff member concerned.

Definition of a staff member in a project:
– a person employed by any of the partner organizations and have a task in the project activities.

Staff costs may be reimbursed based on:

• unit costs, applicable for projects approved with this method (regular call nr 7 and onwards)

OR

• real costs, applicable for projects approved with this method

This means that:

• projects applying for support in regular call nr 7 an onwards can choose which method they prefer, and if approved with the unit costs method those projects shall report their expenditure with the unit costs method.
• projects approved in regular call nr 1-6 still need to report their expenditure with the real costs method, full time or fixed percentage as this was the method applicable in those calls.

Conditions for reimbursement of staff costs based on unit costs (possibility for projects approved with unit costs from call 7 an onwards):

Project partners must report the direct staff cost based on the number of working hours that their employees need for project implementation under the following conditions:

• A project partner cannot declare more than 1,720 hours per full time employee per calendar year. This maximum number of hours is reduced to a pro- rata of 1,720 hours for employees working part-time. The maximum number of hours applies to all projects co-financed by Interreg Aurora. If the same employee works on several projects, the sum of productive hours declared for the employee in these projects cannot exceed 1,720 hours or the applicable pro-rata per calendar year. This maximum number of hours is also reduced to a pro-rata of 1 720 hours for reporting periods shorter than 12 months. The check will be done through the Report of hours document per reporting period; for a 6-month period the maximum allowed hours per each project staff member/employee will be 860.
• A project partner can report only actual (productive) hours that were worked and that were dedicated to project related tasks. Non-productive hours relating to holidays, sick leave, maternity leave, etc. are not eligible.

Project partners have to complete and deliver a report of hours and an employment confirmation in the payment applications when staff costs are reported:

• Report of hours and employment confirmation – a document that verifies the number of hours worked for the project and confirming that the person is working for the project (template will be available)
• Project partners must complete and sign one document per reported employee per reporting period. They must deliver the signed versions as attachments to the payment application in Min ansökan in every report where costs for this employee is reported.

The programme accepts handwritten signatures and advanced and qualified e-signatures. If the document is signed by e-signature, make sure that the document contains metadata or traceable results of the e-signature validator.

Project partners have to keep on their premises, original employment contracts or equivalent employment documents of the persons whose working hours are the subject of the programme co-financing. Project partners do not have to attach those documents to the payment application, but they have to keep it available and deliver it upon request of the programme or any other authorised body (Audit Authority, European Commission, etc.).

Conditions for reimbursement of the staff costs with real costs:
Salary costs include salary payments and other costs directly linked to salary payments incurred and paid by the employer (such as employment taxes and social security including pensions) in line with the employment contract, work contract or other document. In the event of costs borne by the employer occurring from parental leave, those costs may be partly eligible according to national rules. As an example, national rules in Finland states that costs for parental leave is only eligible if there are no costs for a substitute filling up for the absence. National rules in Sweden, states for example that additional salary regarding parental leave paid by the employer could be an eligible cost in projects. And, of course, only costs that are not financed by other sources, may be eligible.

Payments to natural persons working for a project under a contract other than an employment or work contract may be assimilated to salary payments. Such a contract shall also be considered to be an employment document. Both the employment/work contract and an appointment decision /contract of natural persons working for the partner organisation and receiving salary payments are hereinafter referred to as ‘employment document’.

Staff costs can only be related to individuals who work on full-time or part time assignment with a fixed percentage for the project. Eligible staff costs are the gross employment costs actually incurred by a beneficiary, as registered in the accounts and proven by employment documents and payslips. There is no obligation to establish a separate working time registration system. Persons who work only a limited time in the project, such as field workers for 3 months during summer or someone who is employed for only one day or even only one meeting is seen as “full-time”.

Determine, in advance, for each concerned staff member a fixed percentage of time to be worked on the project per month. The percentage could cover the whole project duration but it should at least cover one reporting period. This means that the fixed percentage may be changed in justified cases (e.g changes in the tasks of the employee). The gross employment cost (incl. employer’s contributions and other compulsory payments) shall be calculated and reported in line with the fixed percentage.

The fixed percentage should be stated in a task assignment document for each staff member. The task assignment template can be found on the webpage For project beneficiaries – Interreg Aurora. (If the requirements in the template are already covered in another formal document there is no need to use the template). The document must contain the percentage of time dedicated to the project per month and a description of the project-related role, responsibilities and tasks. The level of details for the tasks should be proportionate to the involvement, the higher the percentage, the more details are expected. The task assignment document is crucial for the fixed percentage methodology and is the basis to prove the plausibility of the time allocation. No separate or individual working time registration (i.e., ‘timesheet’) is needed.

Examples of supporting documents for the verification of expenditure when using real costs
Salary costs shall be verified by an employment document while employment taxes and social security including pensions may also be verified by law and standard practices in the country or the organisation where the individual staff member is actually working, and which is not recoverable by the employer from other sources.

• employment document or any other equivalent legal agreement that permits the identification of the employment relationship with the partner’s organisation;
• job description (providing information on responsibilities related to the project (if not included in the employment document);
• task assignment document setting out the fixed percentage of time to be worked on the project per month (if not specified in the employment document or job description);
• payslips or other documents of equivalent probative value; Please note that the submitted documents must include the components of the salary costs, such as job-related salary, personal allowance and work experience allowance.
• proof of payment of salaries and the employer’s contribution;