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Introduction 

There are occasions when departments require the services of individuals not employed by the university. These individuals are considered independent contractors and prior authorization of their services and fees is required. The type of services performed and amount being paid will determine what type of approvals and authorizations will be necessary.

Unique services are authorized by:

  • AIS / PBS electronic documents in POINT Plus (in most situations)
  • APS paper form (in certain circumstances)
  • Contract (if payment is in excess of $25,000 or if special terms are required)

General and readily available services are normally authorized by a purchase order.

 

Authorization and Payment Overview

Examples of services to be authorized using an Authorization for Individual Services include:

  • Guest speakers at lectures, seminars, and conferences
  • Visiting researchers
  • Other individuals providing unique services, such as professional editors, research subjects, mentors, professional musicians, and conference participants

To obtain the services of an individual or sole proprietor, prior approval must be obtained by completing the following forms:

 

The PIF establishes a vendor record for the payee. Once these forms have been completed, a payment voucher (*DEFINE VP2) must be created and routed to the Office of Accounting for review and final approval.

The Office of Accounting is also responsible for year-end reporting of nonemployee compensation required by the IRS on forms 1099 for U.S. citizens and 1042S for nonresidents.

The paper APS form must be approved prior to the performance of services. This is extremely important to ensure that the individual is properly classified as an employee or independent contractor and the appropriate paperwork is completed.

Prior approval for the paper APS form must be obtained by both of the following:

  • Chair/Director, equivalent Administrative Officer, OR those with electronic signature authority for the account
  • Dean, Vice President, OR those with Dean/VP signature authority in Electronic Office Management (EOM) for PBS

Also, the Grant or Contract Certification section of the APS form must be completed by the principal investigator on all APS forms for expenditures from federal grant or contract funds. Individuals providing services as independent contractors must accept the Terms and Conditions for Federally Sponsored Projects on the Employee/Independent Contractor Classification Checklist.

All State of Texas employees must obtain prior approval from their agency head for outside work. The department must work with the independent contractor to identify and obtain the State of Texas employee’s state agency head’s approval signature for all higher education institutions and state agencies, except employees at another UT System Institution. The agency head’s work approval signature is required prior to the date work begins and must be included in the payment voucher documentation.

For individuals who hold an active appointment at another UT System Institution, the provost's office will obtain the signature of the other institution’s president.

Also see Handbook of Business Procedures - Part 12. Independent Contractors

 


                                                                                                                                         Last Updated: 11 April 2017