Employees and Independent Contractors

Individuals providing services to the University of Houston-Clear Lake must be classified as independent contractors or employees.  Before the determination is made of how to treat payments for services, it is necessary to know the business relationship that exists between the university and the person performing the service. In determining whether the person providing the service(s) is an employee or independent contractor, all information that provides evidence of the degree of control and independence must be considered. Please note, an individual who was previously an appointed employee providing services similar to their previous job duties is classified as an employee, not an independent contractor.

Definitions:

Employee: an employee is an individual who performs services subject to the will and control of the University of Houston-Downtown in terms of what must be done and how it must be done. For purposes of this policy statement, the term "employee" refers to any individual serving in a faculty, research, or staff capacity subject to the terms and conditions described above. An employee is paid through the payroll system, with accompanying tax withholding as required by law.

Independent Contractor: an independent contractor is an individual over whom the University of Houston-Downtown has the right to control or direct the result of the work but not the means or method of accomplishing the result. The independent contractor is paid through the accounts payable system; taxes and FICA are not withheld.

Guidelines:

1. It is the policy of the University of Houston-Clear Lake that service providers will be classified appropriately as employees or independent contractors before any financial commitment is made on the part of the University.

2. Under provisions of state and federal law, an individual may not be hired as an independent contractor when currently on the payroll of any University of Houston System component. Similarly, state law requires that an individual may not be hired as a consultant on an independent contractor basis if employed by any component of the University of Houston System during the previous twelve (12) month period.

3. When the services of a current employee are desired beyond that of the employee's regular job assignment, Human Resources (HR) must be contacted prior to entering into any agreement to determine the appropriate means of hiring the employee for the additional services.

The University created the Employee/Independent Contractor Classification Checklist to classify workers, minimize risk, and alleviate IRS complexities.

• Departments are responsible for completing the EICCC after obtaining the data necessary to complete it from an individual that will provide services to the University. The checklist cannot be completed by the individual providing the services.

The Human Resources department will have final authority for determining whether a service provider is an employee or an independent contractor.

Email the completed form to humanresources@uhcl.edu and our office will respond with the final determination.