Contract Review Information for Faculty and Staff
Q and A on Contract Process
Please Note: Before you proceed with processing a contract, please note that there is one important addition to the process outlined in the
November 2008 Contract Review Memo from the Provost, Treasurer and OGC. Please read the guidance in the November 2008 memo to ensure proper processing of your contract. Reading the memo before processing a contract will save you time. All business contracts must go through the Dept. of Procurement Services prior to being sent to the Office of General Counsel. Please use the Business Contract Routing Form. Business contracts are generally contracts that involve committing university funds, with certain exceptions, as set forth in more detail in the memo.
Contract Review Process (including Independent Contractor agreements)
The CUA Board of Trustees has approved policies governing review and signature authority for all university contracts. The CUA Contract Policy addresses general rules on contracts, and sets forth who has signatory authority to sign a contract. The Grants and Contracts Policy deals with contracts in the context of externally funded research. A summary of how the hiring process works in general is set forth below. See also the May 24, 2007 memorandum by the General Counsel on contract review and signature authority.
All contracts (other than employee appointment forms) binding the university or any of its components must be reviewed by the Office of General Counsel (including hiring of workers as independent contractors, academic program related contracts and business contracts).
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All business, service and construction related contracts must be approved by the cognizant vice-president and may only be signed (by delegation from the President) by the Vice-President for Finance and Treasurer or his/her designee.
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The Provost has the authority to execute contracts arising out of the normal academic operations of the university and this authority has been further delegated in writing to the Associate Provost for Research for execution of sponsored contracts.
The goal of the Office of General Counsel in all contract review is to provide timely service while assuring all agreements meet reasonable university requirements for legal compliance, good business practices and necessary insurance coverage.
No Independent Contractor agreement can be processed through the Office of the Vice President for Finance and Treasurer (e.g., through Accounts Payable, Business Services, Payroll or Human Resources) unless it has been approved by the General Counsel. Note, too, that no person should begin any work, whether on or off campus, as an independent contractor until a properly executed agreement has been approved by the General Counsel and the Business Services office.
To facilitate the contract review process, we recommend that you first contact the General Counsel to determine whether the proposed hiring arrangement is permissible under federal tax law and university policy. If the proposed arrangement is for an independent contractor, the General Counsel has developed the following form contracts that may be used. Please note that these form contracts are not appropriate for all situations. If questions, please call the Office of General Counsel.
You may print these contracts from this Web page, and insert the requested information on the document. The completed form contract, accompanied by the Business Contract Routing Form can be sent to the Purchasing Department, Leahy Hall LL40. It will then be routed to The Office of General Counsel whose approval signature is required on the contract before it can proceed through any payment process.
If the contracting entity will have access to or retention of covered data as defined in the CUA Information Security Policy, then the GLB privacy addendum must be incorporated as part of the contract.
Summary of Correct Hiring Process (from a September 11th, 2003 memo to the Administrative Council by Craig W. Parker, General Counsel)
Please proceed with the hiring of workers with the following guidance in mind:
1. The Internal Revenue Service operates with a legal presumption that workers will be hired as employees. At CUA, forms for hiring employees include Part II forms, the Employee Data Form, the Appointment to Research Staff form and other common academic appointment forms such as faculty appointment, Lecturer, Adjunct Professor, Teaching Assistant and Research Assistant. No person can begin work as an employee without an approved form.
2. For workers who are to be hired as employees, either on a Part II and Employee Data Form or on an appointment form from the Provost’s Office, managers should follow the procedures already in place for those forms. The form to be used for hiring a person as an employee and the classification of their position under the Fair Labor Standards Act (e.g., as an hourly employee or on a monthly basis) is determined by the Office of Human Resources. The Office of Sponsored Programs and Research Services processes research appointment forms for positions funded by outside contracts and grants.
3. For persons proposed to be hired as Independent Contractors (i.e., people who satisfy IRS guidelines and will have invoices for their hours worked processed through the Business Services/Accounts Payable area) the proposed contract must first be reviewed by the Office of General Counsel. This means review and approval before the individual begins any work for the university. Note that, pursuant to IRS rules, anyone who has recently been on the university's payroll as an employee or is currently an employee cannot ordinarily be approved to become an Independent Contractor. In such cases, a new assignment/position as an employee will be established by Human Resources or the Provost’s office.
Where there is no potential conflict with status as an employee, the General Counsel's office will review the proposal in accordance with IRS guidelines and determine whether an Independent Contractor relationship is permissible. Each case must be individually reviewed. The IRS guidelines focus on facts which illustrate who controls the worker's performance, facts related to financial control and other facts defining the relationship of the parties. A list of questions used by the General Counsel’s office to help determine whether to approve a particular proposed contract is online. Click here for the OGC Independent Contractor Checklist. Hiring managers may save themselves time and effort if they have such proposed agreements reviewed by the Office of General Counsel before preparing a final executed copy of the contract.
Q and A on Contract Process
Q: Does the university Office of General Counsel need to review shrink wrap (or click-wrap) licenses?
A: OGC only needs to review a shrink wrap license if a relatively high dollar amount is involved (over $50,000). In most cases involving a shrink wrap license, such an amount will not be reached. Consumers should familiarize themselves with *shrinkwrap* agreements. They generally involve software, and state that acceptance on the part of the user is indicated by opening the shrinkwrap packaging of the software. The enforceability of the terms of such agreements is a gray area of the law.
OGC contracting reference materials
links updated 6/5/08 rab
updated 9/25/08 to add business contract routing form
updated 10-31-08 to make Purchasing info more prominent, added Q and A on shrinkwrap
Last Revised 16-Mar-09 02:25 PM.
