Examining ED's Incentive Compensation Rule

Webinar

Since 1992, institutions of higher education participating in the federal student aid programs have been required to comply with the U.S Department of Education's prohibition on incentive compensation. In simple terms, the rule prohibits institutions from providing any form of commission or bonus to individuals based on their success in covered recruiting activities or the awarding of financial aid. But as is the case with many federal regulations, interpreting and complying with the incentive compensation rule is anything but simple. Indeed, complexities rapidly arise when the rule is applied to multi-tiered organizations with varied compensation plans, bundled services agreements with third-party providers (e.g., online program managers), non-Title IV programs, or referral initiatives, to name a few. And the consequence of non-compliance can be severe.