708.1 - Procedure for Independent Contractor Predetermination Process

Title

University of North Carolina at Chapel Hill Finance Procedure 708.1 - Procedure on Independent Contractor Predetermination Process

Introduction

Purpose

The purpose of this document is to describe the procedure on Independent Contractor Predetermination Process. 

Scope of Applicability

This policy applies to all departments at UNC-Chapel Hill that would like to pay independent contractors.

Procedure

Prior to making a commitment to an individual to be paid as an Independent Contractor, the department must complete a background check for an assignment lasting in excess of ten (10) calendar days, involving a continuous relationship and/or involving access to sensitive populations or sensitive facilities/data. A background check must be completed prior to the initial appointment and on an annual basis. Background check results are valid for twelve (12) months from the date of completion with no disqualifying results. Sensitive populations are defined to be individuals less than 18 years of age, patients receiving care in any clinical setting, or other individuals deemed to require enhanced supervision or protection based on University practice or State or Federal law. Sensitive facilities are University facilities that require special clearance or background checks for access as well as confidential or protected records.

Upon completion of the background check, the department will create the Employee/Independent Contractor Determination Checklist (EICDC) in ConnectCarolina and the checklist will be routed to Accounts Payable for review and require the Independent Contractor to fill out Form 1218.1.2f - Direct Deposit Authorization Form for Vendors (ACH). This pre-approval will ensure there are no payment delays and that the University is in compliance with IRS regulations. Foreign vendors may require payment by wire transfer. Please see the Accounts Payable and Vendor Services website for more information.

Forms and Instructions

Once the department determines a background check is necessary, the department background check initiator completes the background check ePAR in ConnectCarolina to initiate the background check process. The background check unit reviews the ePAR request and sends the candidate/appointee an email invitation to complete the background check questionnaire. The University's background check service provider then conducts the background check, which includes the following components:

  • criminal convictions check for all state jurisdictions
  • federal criminal check
  • national sex offender registry check
  • degree verification (if required)
  • driver’s license check for those positions that require driving in the scope of responsibilities

The normal criminal conviction checking fees are the responsibility of the appointing department. In instances where a contractor has no Social Security Number due to citizenship status, the University's Office of Human Resources (OHR) will make a good faith effort, based on name alone, to confirm that no residential history or criminal convictions have been recorded for this individual. The background check requirement is waived for contractors indicated in the "Exclusions" section above.

The PID and name of the department representative most familiar with the individual and the work to be performed is required on the EICDC in ConnectCarolina.

The tax identification number of the Independent Contractor will be required for creation of the EICDC. Attach the following documents via ImageNow:

  1. If total payment to the contractor in a 12-month period is less than $10,000.00, submit EICDC W9, and refer to background check policy and procedures.
  2. If total payment to the Contractor in a 12-month period is more than $10,000.00, submit EICDC W9, refer to background check policy and procedures, Independent Contractor Service Agreement and Statement of Work, and Customer Request for a Brand/Vendor Specific Waiver of Competition.
  3. Page four (4) of the Authorization for Background Check form, showing background check completion.

Allow sufficient time for the review process of the EICDC as in some cases the University's Office of Human Resources or University Counsel's Conflict of Interest Officer concurrence is required.

Exceptions

Any one of following circumstances waives the requirement for a background check:

  • If the assignment is ten (10) or less calendar days without any continuous relationship and involves supervised access to sensitive populations or sensitive facilities. This includes contractors who are invited to deliver a presentation at the University.
  • If the contractor will perform the assignment in his/her own facilities, has no access to confidential or protected records or data, and has no direct contact with sensitive populations for the duration of the engagement. 

Frequently Asked Questions

Q: We have a speaker who will give a public lecture including students. Do we need a background check?
A: No.

Q: We will have a contractor who performs her services in her NY office and has access to the student files. Do we need a background check?
A: Yes, because she will have access to sensitive data.

Q: Our department will pay a contractor $11,000 including $2,000 of expenses. Does this require an Independent Contractor (IC) Service Agreement?
A: No, since the total fee/income is less than $10,000 only the EICDC is needed.

Q: If I hire an independent contractor to work only at UNC-CH for twelve days continuously or over an extended period of time, does the individual need to have a background check?
A: Yes, because the assignment will last longer than ten (10) days.

Q: If I were to hire an independent contractor in another country who will never travel to the U.S. as part of this assignment, does the individual need to have a background check?
A: No.

Q: How does this policy affect non-resident aliens if there is not a mechanism to do international criminal background checks?
A: This policy still applies if non-resident aliens are working in the United States. This policy does not impact non-resident aliens working internationally.

Q: What impact would this have on Aramark and Xerox?
A: Large vendor contracts (such as Aramark and Xerox) are not affected. "C" corporations are defined by the IRS as not Independent Contractors.

Q: How will Independent Contractors who work for various departments on campus be treated? Will each department have to complete a background check?
A: Yes, multiple forms will need to be filled out if the work is different and/or performed for another department.

Q: What will the turnaround time be on criminal background checks? We often don't know we need to hire an Independent Contractor until a few days before a project begins.
A: The turnaround is seven (7) business days.

Q: Will we have to run a new criminal background check each year for contractors we use from year-to-year (i.e. photographers for our magazine, freelance writers, etc.)?
A: Yes, if the Independent Contractor has not had a background check in the past twelve (12) months.

Q: Will the Independent Contractor rules apply to foundations?
A: Foundations have their own rules. UNC does not administer IC rules for the foundations.

Related Requirements

University Policies, Standards, and Procedures

Contact Information

Primary Contacts
Subject Contact Telephone Fax Email
Independent Contractor Review and Determination Accounts Payable and Vendor Services 919-962-0747 919-962-2356 accountspayable@unc.edu
Independent Contractor Background Check Results Office of Human Resources     ICRequest@unc.edu
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Details

Article ID: 131542
Created
Thu 4/8/21 9:11 PM
Modified
Tue 11/23/21 3:15 PM
Effective Date
If the date on which this document became/becomes enforceable differs from the Origination or Last Revision, this attribute reflects the date on which it is/was enforcable.
11/23/2021 12:00 AM
Issuing Officer
Name of the document Issuing Officer. This is the individual whose organizational authority covers the policy scope and who is primarily responsible for the policy.
Issuing Officer Title
Title of the person who is primarily responsible for issuing this policy.
Director, Accounts Payable & Vendor Services
Last Review
Date on which the most recent document review was completed.
11/23/2021 12:00 AM
Last Revised
Date on which the most recent changes to this document were approved.
11/23/2021 12:00 AM
Origination
Date on which the original version of this document was first made official.
09/09/2008 12:00 AM
Responsible Unit
School, Department, or other organizational unit issuing this document.
Finance and Budget