Personal services may be secured to provide professional, technical, scientific, or artistic services. The following procedures for securing personal services must be adhered to by all departments regardless of cost, type, or source of funds.
Cost of the service and the contractual relationship between the individual and the University will largely determine the method of procurement.
Guidance for contracts that are not personal services in nature is found in the next section, "IX. Other Contracts." Any questions regarding contracts should be directed to Procurement Services at extension 65260.
Services Involving University Faculty/Staff and Students
Regardless of cost, if the individual providing the service is a member of the Missouri State University faculty or staff, then a Personnel Action Form must be submitted to the Office of Human Resources. Payment for services of this nature will be processed through the Payroll Office. Students not currently employed on campus, providing a service, that is non recurring in nature, may be paid from an invoice for services if they are acting as an independent contractor. Contact Financial Services for further information.
Services Involving Independent Contractors
According to guidelines established by the Internal Revenue Service, individuals contracted to provide a personal service for the University may do so on an independent contractor basis. See the sub-section entitled "IRS Tests for Independent Contractor Status," for guidelines in determining contractor status. For additional information or assistance in determining whether an individual qualifies as an individual contractor, contact the Office of Human Resources (extension 65102) or the Payroll Office (extension 65632).
Independent Contractor Services Costing $750 or Less
If the services provided are non-recurring in nature and the total expenditure is less than $ 750, a payment request must be completed and submitted to Financial Services for payment. When completing the payment request provide as much information as possible concerning the following:
- Type and scope of service required
- Date(s) of service required
- Name, address and social security number of individual providing service.
Should the vendor or individual not have an invoice, blank invoices are available from Financial Services for this purpose.
Purchases using "split tickets" (purchases greater than $750, being placed on more than one receipt) are strictly prohibited.
Independent Contractor Services Costing More than $750.
If individual services provided will cost more than $ 750, procurement is necessary through the competitive bid process by the Purchasing Office.
The requesting department must generate a Purchase Requisition through the UBUY System and submit it to Financial Services for funding. Once funded, the request will be sent to the Purchasing Office for procurement. The requisition must contain the following:
- Type and scope of service required
- Location of where service is to be performed
- Date(s) of service
- Names and addresses of individuals and/or vendors who provide the type of service required.
Services of Individuals as Employees
If an individual cannot meet the criteria as an "independent contractor," a Personnel Action Form must be submitted to the Office of Human Resources and the individual hired as an employee of the University.
Occasionally, an unique qualification or credential may allow a specific individual to perform a service costing more than $750 as an exception to the competitive bid process. The requesting department must generate a Purchase Requisition through the UBUY System and submit it to Financial Services for funding. Once funded, Financial Services will forward the requisition to the Purchasing Office for procurement.
In addition to the required information as stated in paragraph 2 above, written justification stating the rationale for not competitively bidding the service must accompany the requisition. On the UBUY System, this can be included as a "Requisition Comment."
State Purchasing Directive 1.4-3004 defines the exception as "any individual who presents a speech or entertains ... and who, in return, is normally reimbursed for actual and reasonable travel expenses and given an honorarium, as opposed to an hourly rate or per diem fee, for the donation of his or her time."
Based upon the information submitted, the Purchasing Office will determine if competitive bidding is necessary.
Contractual Requirements for Personal Services Costing More than $750
An agreement (contract) must be signed by the individual providing the services in advance of the services being rendered. The Director of Procurement Services must sign the agreement for the University. The agreement forms are available from Financial Services.
Grants Requiring Personal Services
Regardless of cost, grants requiring personal services must be reviewed by the Financial Services Grants and Contracts Accountant, at extension 65632, to determine how an individual should be paid.
IRS Tests for Independent Contractor Status
- Independent contractors are often described as persons engaged in occupations who contract to perform work according to their own methods, without being subject to the control of the employer except for the result. The Internal Revenue Service examines the following factors in determining whether an individual is an independent contractor or an employee. It should be kept in mind, however, that the presence of one or more factors is not necessarily conclusive--all of the factors must be taken into account. These factors are guides to the primary question of whether the worker is in fact independent, or subject to the control of the employer and therefore, an employee.
- The extent of control that the employer may exercise over the details of the work.
- Whether the worker is engaged in a distinct occupation or business.
- The kind of occupation, with reference to whether, in the locality, the work is usually done under the direction of the employer or by a specialist without supervision.
- The skill required in the particular occupation.
- Whether the employer or the worker supplies the instruments, tools, and place of work for the person doing the work.
- The length of time the work will take.
- The method of payment, whether by the time or by the job.
- Whether the work is part of the regular business of the employer.
- Whether the parties believe they are creating an employment relationship or an independent contractor relationship.