West Virginia University Policy
Division of Administration and Finance
CONSULTING AGREEMENTS POLICY
The purpose of this policy is to detail the issues that need to be addressed and approved prior to contracting for personal services rendered to the University.
This policy applies to all University campuses.
Consulting agreements are utilized for payment of non-employees for personal services rendered to the University and are to be completed and approved prior to contracting for or obtaining services. Prior to contracting for personal services, three issues must be addressed:
- Should the vendor be treated as an employee of the University?
- Should the service be competitively bid?
- Is the individual a resident of the United States?
EMPLOYEE VS. CONTRACTOR
It is the employing unit’s responsibility to determine if an individual is an employee or an independent contractor. Preliminary determination of the employment status of a consultant can generally be ascertained by answering the “Employee Relationship” questions in the Consulting Agreement procedure. Individuals not clearly passing this test should be treated as employees and must be paid through the University payroll process.
Competitive bidding is required when the result of the “Employee Relationship” shows the individual should be treated as an independent contractor, the cost of the entire service to be performed exceeds $1,000, and the service does not meet requirements of sole or single source procurement.
Bidding requirements are met by documenting responses to the “Competitive Bidding Requirement” questions in the Consulting Agreement procedure, Controller’s Procedure Manual, Purch-3.
For the University to determine the appropriate tax treatment, the department must have the individual indicate on the Service Agreement that he or she is a resident of the U.S. or possesses an immigrant visa (green card). For non-resident aliens, the department must obtain a copy of the individual’s visa and the date the individual entered the U.S. The department should then contact the Controller’s Payroll/Travel Unit for guidance prior to hiring the individual or reimbursing them for any costs, including travel.
Procedure development rests with Procurement Services.
RESPONSIBILITY FOR IMPLEMENTATION
All employees are charged with providing full support to this policy. It is the responsibility of the Dean or Director to implement and maintain this policy within their college, department, or unit. Procurement Services, at 293-5111 or P.O. Box 6024, is available to answer questions or provide additional information regarding this policy.
RESPONSIBILITY FOR INTERPRETATION
The responsibility for interpretation of this policy rests with the Controller, West Virginia University.
Effective Date: September 10, 1998
Approved By: Scott C. Kelley, Vice President