Consistent with Internal Revenue Service (IRS) rules, it is the responsibility of an employer to ensure that individuals who are paid compensation as an independent contractor meet specific criteria that demonstrates an employment relationship does not exist. Therefore, the policy herein sets forth the procedures and guidelines campus departments must follow when hiring independent contractors.
The scope of this procedure applies to aspects of State and Research Foundation purchasing functions throughout the College.
Any individual performing services for SUNY Geneseo will be presumed to work under the direction and control of the College and, therefore, deemed to be an employee unless the individual meets the independent contractor criteria, established within this procedure, and provides the College with a valid federal taxpayer identification or social security number for tax reporting purposes.
Under IRS rules, anyone who performs services for the College is considered an employee if a College department has the ability to control what will be done and how it will be done when accomplishing the task or project for which the individual is being compensated to perform.
It is the responsibility of the contracting department to ensure compliance with IRS guidelines with respect to classifying a worker. Liability for classifying an employee as an independent contractor may include payment for:
- Employer share of Social Security and Medicare taxes
- Employee share of Social Security and Medicare taxes
- Unemployment taxes
- Civil fines
- If found to be a criminal matter, possible imprisonment
An independent contractor status exists when the individual:
- Determines place and sequence of the work
- Is not provided training by the College for the work
- Possesses specialized skills required to perform the work
- Provides a service not related to the College's normal business activities
- Has the option to delegate work to others (other than employees of the College)
- Employees own assistants/helpers
- Works by the job
- Sets own work hours
- Generally works off site
- Can set own schedule (work flow)
- Files reports when job ends, but does not submit regular reports
- Furnishes own tools and equipment
- Has a significant investment in the facilities used
- Can make a profit or suffer a loss if project is not completed
- Works for several companies at the same time
- Makes service available to the general public
- Cannot be fired if results satisfy the provisions of contract
- Must complete the work according to contract specifications
1. Review the Guide to Determining Independent Contractor Status to understand the difference between employee and independent contractor. The guide is located on the Human Resources website at:
2. Complete the Checklist for Determining Worker's Status, Employee or Independent Contractor form if you believe the individual should be compensated as an independent contractor. The form uses the standard IRS 20 Factors of the Common Law Test to determine whether an individual is an employee or an independent contractor. The checklist is located on the Human Resources website:
3. If the individual is deemed to be an independent contractor:
- -Contact the Director of Purchasing & Central Services (or the Associate Vice President for Administration) as soon as possible with detailed information about the type and scope of work the independent contractor is to perform. The Director or AVP will assist the hiring department with drafting a Letter of Agreement between the College and the independent contractor that defines their relationship and the terms of the agreement.
- -Advance approval is requested to engage the services of an individual listed as a speaker/vendor/contractor.
- -The hiring department submits the signed Letter of Agreement to the Procurement Services Department with a purchase requisition and the Checklist for Determining Worker's Status or Employee or Independent Contractor the Procurement Services Department Incomplete forms will be returned to the originating department. Delays in paperwork may cause delays in work to be performed. The individual may not begin assignment/task until the Procurement Services Department is able to verify all of the information submitted.
- -After services are received, the independent contractor submits an invoice to the Accounting Services Department. The campus personnel hiring the independent contractor is responsible for contacting the Accounting Services Department to approve payment of services.
4. Contact the Human Resources office for the procedures to hire if the individual is determined to be an employee.
NOTE: If the individual currently is employed by the College, SUNY, State of New York, or Research Foundation, or is a statewide elected official in any capacity, he/she automatically classifies as an employee.