Furlough Programs and Implications for Financial Research Compliance (Updated)

COGR provides a comprehensive analysis of the financial and compliance implications of implementing furlough programs at higher education and research institutions, particularly in response to the budgetary pressures brought about by the COVID-19 pandemic. It examines key considerations such as federal cost principles under 2 CFR 200, the treatment of different funding scenarios, split-funded employees, effort commitment, funding source changes, fringe benefits, cost sharing, and the importance of consistency in compensation policies. The document emphasizes the need for carefully structured, consistently applied furlough or salary reduction plans to mitigate compliance risk, noting that while no formal federal approval is required, adherence to established federal costing principles and thorough institutional documentation are essential to minimize regulatory and financial exposure.