International Development and Programs (Development Work) - International Development and Programs (Development Work)

We are often asked the question whether USAID does have a maximum pay rate for contractors. The answer is YES: The standard that USAID uses as the "USAID contractor salary threshold" (CST), formerly know as the "maximum daily rate", is the equivalent of the Office of Personnel Management (OPM) maximum rate of pay for agencies without a certified SES performance appraisal system.

When researching the rate, please follow these steps:

1. Go to the OPM web page at www.opm.gov
2. Click on "View Salaries and Wages"
3. Click on "Senior Executive Service"
4. Click on Schedule for "Basic Rates of Pay for Members of the Senior Executive Service (SES)"
5. Look at the maximum for "Agencies without a Certified SES Performance Appraisal System"

In 2011, the maximum daily rate is $635.77 excluding allowances (post differential, danger pay, Post Allowance/Cost of Living Allowance - COLA) and others which depend on the posting. The maximum daily rate is calculated as follows for 2011 (which is similar for 2010 - the rates were frozen as of January 2011):

$165,300/2080 = $79.47 Hourly Rate * 8 hours  = $635.77 Daily Rate

Some additional notes:

• Only professionals with a salary history (documented with a valid form AID1420-17) that supports remuneration level at the CST threshold may be remunerated at the maximum level (very few are). Only the base rate counts. Per diem and other allowances are not taken into consideration when a consultant's daily rate is determined.
• The CST policy applies to types of contracts in which the actual salary of the individual is considered in establishing the price or the fixed labor rate for services.
• The base for hourly rate calculation: USAID policy requires contract rates to be established on an hourly basis.
• For estimating purposes, non-personal services contractor's rates are to be calculated based on 2080 hours/year, the number used by many private sector entities.
• If a contractor employs methods or calculations using other than 2080 hours/year, the Contractor must annotate this in its proposal. The USAID CST is applicable to for-profit and non-profit firms. It is not applicable to grants or cooperative agreements.