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
This policy applies to all departments at UNC-Chapel Hill that would like to pay independent contractors.
Procedure
A background check is required for an Independent Contractor when their cumulative assignment period will last in excess of ten (10) calendar days, involve a continuous relationship with and/or involve access to sensitive populations, facilities, and/or 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.
Consistent with federal law, once an Independent Contractor is selected for an appointment, the appointing department must make a contingent offer in writing before initiating the background check. A contingent offer is a formal offer that is dependent upon satisfactory outcome of the background check process and other contingencies. A contingent offer may be rescinded if any of the contingencies are not satisfactorily completed.
The appointing department must use an approved offer letter template (see templates) or their own offer letter template that includes the appropriate contingent offer statement:
This offer is contingent upon the satisfactory outcome of a background check, verification of academic and professional license credentials, and reference checks, if applicable. The University’s offer may be rescinded based upon the results of these factors.
When all appointment requirements have been satisfactorily completed, the appointing department will send the Independent Contractor an invitation via PaymentWorks if their supplier record is not connected. Simultaneously the department will create the Employee/Independent Contractor Determination Checklist (EICDC) in ConnectCarolina and the checklist will be routed to Accounts Payable for review. This pre-approval will ensure there are no payment delays and that the University is in compliance with IRS regulations. Once Independent Contractor approval is received the appointing department makes a final offer.
Forms and Instructions
Once the appointing department determines a background check is necessary and a contingent offer has been made in writing, 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 conducts the background check, which includes the following components:
- A residency history and social security trace (includes Social Security Administration Death Master File search)
- A criminal convictions check for applicable state and local jurisdictions in which the covered individual has lived within the last seven (7) years (results reported by the consumer reporting agency beyond this time frame may be considered)
- A criminal convictions check of federal court records
- A national sex-offender registry check
- An education credential verification (if applicable)
- A professional license verification for any covered individual whose position requires a professional license (if applicable)
- A driver's license record verification of applicable state motor-vehicle licensing agencies for any covered individual whose formal duties include driving (if applicable)
Background check component fees and university administrative 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 email address the PaymentWorks invitation was sent to or the supplier ID, if connected in PaymentWorks, of the Independent Contractor will be required for creation of the EICDC. Attach the following documents via ImageNow:
- 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.
- 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.
- 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 average 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 |
ic_review@unc.edu |
| Independent Contractor Background Check Results |
Office of Human Resources |
|
|
backgroundcheck@email.unc.edu
|