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Departments frequently desire to contract with a person to provide services (e.g., a guest speaker, consultant, etc.) The decision to classify the individual as an independent contractor vs. a University employee can be complex and difficult. It is critically important that a correct determination of the individual’s status be made prior to engaging that person and that all required processes be followed to engage the person. Engagements that are entered into without all required approvals may not meet all legal requirements for treatment as an independent contractor. In those cases the person will be treated as an employee, the department will be responsible for payment of the compensation as well as the applicable fringe benefit rate. In addition, the University employee that engaged and/or approved the services may be held personally liable for payment for the services.

The characterization of a person as an independent contractor or as employee has important tax and non-tax consequences to both the University and the individual. When faced with a characterization issue the University will almost always treat individuals as employees, absent a strong, factual basis for classification as an independent contractor.

Who is Eligible to be an Independent Contractor?

• Any person who is in the business of providing services to the general public and NOT just the University may be considered for independent contractor status.
• University employees cannot be considered independent contractors and may not receive both a W-2 and 1099 in the same calendar year.
• Whether a person is an independent contractor or employee will depend on the facts of each case and requires an individualized assessment.
• The final responsibility for determining independent contractor status is the responsibility of the Department of Human Resources or Academic Personnel Services. For student organizations, the final determination will be made by the Office of Student Activities.

There are also  of the Ohio Public Employees Retirement System () that may result in a discontinuance of retirement benefits when working as an independent contractor. The State Teacher Retirement System () has  that impact former public employees’ reemployment ability to be an independent contractor.

Independent Contractor or Employee?

An independent contractor is a person who meets all of the following criteria:

• Renders a service to the University for a specified payment amount for a specified result;
• Is engaged in an independently established profession or business (offers similar services to the general public on a consistent basis);
• Provides a service outside of the University’s usual course of business or services that are not typically performed by University employees;
• Is not currently paid through University Payroll and has not been paid through Payroll within the current calendar year;
• Provides services through the University's (or another University-approved form of agreement, e.g. Speaker Agreement); and
• Is free from University control or direction when providing services.

Examples of Independent Contractors:

• professional entertainers
• Academic guest speaker, artist, or special lecturer
• Distinguished guest speakers at University functions
• Professional publication manuscript reviewers and editors
• Non-recurring seminar and workshop leaders
• referees

The University’s Determination of Independent Contractor Services form is available here. Please note a person who has assigned instructional duties does not qualify as an independent contractor.

Pre-Approved Independent Contractors

The University has pre-approved and entered into independent contractor service agreements with a number of individuals to perform independent contractor services for student organizations. Please contact the Student Life Assistant Director for Business Operations at 513-529-2598. 

Insurance Coverage

Except for speakers and certain other independent contractors, the vast majority of individuals contracting with the University will be required to maintain professional liability, general liability, automobile, and workers’ compensation insurance that meets the minimum coverage levels required by the University. Such individuals must provide the University, prior to the commencement of work, a Certificate of Insurance (COI) confirming that they have the required coverage in effect.

Background Check

The University may require that a proposed contractor undergo a background check for certain assignments, e.g., assignments involving interaction with minors. In such cases, the individual will be asked to sign a consent form for use by Human Resources in scheduling the background check with the University’s third-party service provider.

Procedures for Engaging An Independent Contractor

For assistance, please contact the Director of Employment in the Department of Human Resources at 513-525-4745 (non-academic units), the Director of Academic Personnel Services at 529-7268(academic units) or the Assistant Director for Business Operations in Student Life at 513-529-2598 (student organization). 

Competitive Selection/Bidding Requirements

1. A competitive bid or selection process is not required for independent contractor engagements of up to $10,000.
2. Multiple written quotations are required for independent contractor engagements $10,001 and $24,999.
3. For independent contractor engagements of $25,000 or more quotations and/or proposals will be obtained by the Office of Strategic Procurement through a competitive selection process based on written specifications provided by the requesting department.

Exemptions to Bidding Requirements

The following persons/services typically qualify as an independent contractors and do not need to be bid regardless of the amount of payment:

• Professional entertainers;
• Academic guest speaker, artist, or special lecturer;
• Distinguished guest speakers at University functions;
• Professional publication manuscript reviewers and editors;
• Non-recurring seminar and workshop leaders; and
• Referees.