Employee or Stipendee? Issues to Consider

After being awarded a postdoctoral fellowship through the NASA Hubble Fellowship Program (NHFP), your host institution may offer the option of working either as an employee, a stipendee, or both. This document is intended to highlight issues that you may want or need to consider when making this choice.

If some of these issues are particularly important to you, you may want to contact a potential host institution before you apply for the fellowship to make sure that the benefits you require will be available. The choice of whether to be a stipendee or an employee is strictly between prospective fellows and their host institutions, and should not substantially involve the NHFP office or grant officers. This document is an informal set of suggestions and is intended to be generally helpful, but should not be considered as conveying any official requirements or legal advice.

Introduction

Potential host institutions have different policies. Many (but certainly not all) seem to have standard stipend fellowship procedures in place. Several prefer that the fellows be employees as it is easier for the institution, where others cannot hire fellows as employees. Several can offer either model.

Visa Issues

For non-U.S. citizens, visas are most commonly either J1 or H1B. We strongly recommend that you contact a visa expert at your host institution or elsewhere to make sure that you have accurate and current information relevant to your particular situation. The NHFP office unfortunately cannot advise you on visa issues, nor provide funding related to (e.g., application or lawyer) fees. Your visa must be valid for the duration of your fellowship.

J1 Visa

Your host institution is responsible for assisting and advising you on all matters relating to your J1 program, including authorizing travel outside of the U.S. and ensuring that your J1 Non-immigrant documents are valid at all times. J1 Research Scholars are limited to 5 years, and extensions beyond that time are NOT routinely granted.

The most common J1 visa issue is the two-year home country physical presence requirement. If unable to return to their home country to fulfill the two-year requirement, fellows must follow proper immigration procedures as required by the Department of Homeland Security and/or your home country. Some relevant information may be found at:

H1B Visa

Employee fellows may be able to apply for and obtain an H1B visa. The initial period of stay in the United States for an H1B is up to 3 years. Extensions are possible in up to 3 year increments. Maximum period of stay is generally 6 years (extensions beyond 6 years may be possible).

More relevant information may be found at: http://www.uscis.gov/eir/visaguide/entrepreneurvisaguide

Green Card

A green card bypasses the above visa issues for either model. Again, the NHFP office cannot provide funding related to fees (e.g., application or lawyer).

More information on green cards: http://www.uscis.gov/greencard

Tax Issues

Tax issues are best addressed in consultation with a qualified attorney or tax advisor, which may be available through your host institution. The NHFP office unfortunately cannot advise you on tax issues, nor provide funding related to tax attorney or tax advisor fees. Taxes are paid by fellows whether they are stipendee or employee. Some relevant information is available at http://www.nationalpostdoc.org/?TaxIssues.

For employees, federal and state taxes are likely to be withheld automatically by your host institution. You may also want to ask about Social Security and Medicare taxes.

Some nonresident aliens may be eligible for exemptions from federal income tax withholding on wages based on tax treaties negotiated between the fellow's country of residence and the United States. State income tax requirements may differ from federal taxes and also from state to state; fellows should review relevant state tax laws. Tax obligations are complex and fellows should consult a tax accountant or other tax professional regarding their individual tax situation.

Health Insurance

For stipendiary fellows, health coverage is fully paid for up to an annual maximum that is usually adequate to cover a fellow and family, if applicable.

If a fellow has an employment arrangement, full-time or postdoc status, they are expected to pay the employee portion of the premium. If a fellow or family member has any special health needs, the fellow should check the insurance offered by the host institution carefully to ensure those needs will be covered as funds are available for health insurance only.

Leave

For stipendees, there is no set leave policy, as long as the fellow remains productive. Productivity is judged effectively by symposium participation, publications, and annual reports, although the faculty contact may also provide input to the fellowship program office.

The NHFP generally encourages several weeks of annual (vacation) leave, as well as sick and/or family leave (to take care of a close family member) when necessary. Under a stipendiary model, fellows are not allowed to take more extended leave. If absolutely necessary for personal or family reasons, the fellow can have unpaid extended leave by asking for a no-cost extension of their award.

For employees, each host institution will have a leave policy covering annual, sick, extended, and/or family leave. Leave may in many cases only be gradually accumulated during the fellowship, so that extended leave early in the fellowship may need to be unpaid.

Travel

For stipendees there is no set travel policy, as long as they meet requirements that will be provided in their policy and budget information document (including advance justification for foreign travel if required), stay productive, and their faculty contact has no complaints.

Sponsored travel (e.g., paid for by the Université de Paris) or offsite work is simple for stipendees, whereas employees often need invoicing for sponsored travel, and/or designated action by the host institution’s human resources department for offsite work. Fellows should be aware of these differences when choosing a model.

Retirement Benefits

For stipendees, there are no retirement benefits.

For employees, retirement funds come out of the negotiated overhead/fringe rates. The benefits may differ between institutions. Generally, there will be a 401(a) plan for employer contributions and possibly a 403(b) for voluntary employee contributions. Such funds, if accrued, are unlikely to amount to much over the course of a fellowship, but note that retirement funds cannot be withdrawn before retirement without substantial tax penalties, so should likely be “rolled over” to a similar but portable account.

In some institutions, fellowship holders are not given vested retirement accounts, even though they are employees, but the host institution may offer extra funds to make up the difference. This can be accepted by the fellow only if the funds are placed directly into a retirement account with standard penalties for early withdrawal. Fellows in this situation should contact the NHFP grants office at STScI to make sure that their program will comply.

Disability and/or Workman's Comp

Disability is typically available to employees, but not to stipendees. Check with your host institution

Life Insurance Options

For stipendees, there are no life insurance benefits.

Employees will often have some basic life insurance as a benefit. Check with your host institution.

Telecommuting Policy

Fellows are expected to be in residence at their host institutions under either model. As long as they stay productive and their faculty contact has no complaints, fellows can occasionally work from home. Employee fellows would need to follow specific rules set by their host institution for telecommuting.

 
 
 
 

Last updated: August 30, 2017