Independent Contractor

An independent contractor is a person who is contracted to perform services without having the legal status of an employee. Requests for these services using sponsored and non-sponsored Research Foundation (RF) funds are submitted through Research Foundation Human Resources to determine classification as an independent contractor.  Payment for independent contractors is processed through the ShopBlue e-Procurement System.

On this page:

Procedure for Sponsored and Non-Sponsored RF Funds Only

The procedures on this page apply to independent contractors paid with sponsored and non-sponsored RF funds only.  A different process is followed when using state and UBF funds.  Learn about the independent contractor procedure for UBF funds and the honoraria process for state funds.

About Independent Contractors

Independent Contractors (IC) are generally individuals who follow an independent trade, business or profession in which they offer their services to the public and complete such services free of control or direction from the payer as to the means and methods used to complete the task. Under the Internal Revenue Service (IRS) general rules, even if you choose not to exert control over what the worker does and how the worker performs the services, the ability to do so generally points to an employee relationship, not that of an IC.

Independent Contractors are not individuals who are already Research Foundation employees, or who have been or will be within the same calendar year.  Employees who perform a task that is different from their regular duties, and after normal work hours, are eligible for overtime pay, extra service or dual employment.

The IRS uses the 20 Factors of the Common Law Test to determine whether an individual is an employee or an IC. These 20 factors or 20 questions assist in determining if a relationship or evidence of control/right to control (behavioral and financial) exists between the payer and worker.

Under IRS rules, anyone who performs services for you is your employee if you can control what will be done and how it will be done, even if freedom of action is granted to the individual worker.

A worker may always be classified as an employee even if the worker meets the criteria of an IC.

Independent contractors are individuals being paid under their Social Security Number (SSN).

Regular purchasing procedures apply if paying a company or organization with an Employer Identification Number (EIN), or an employee of a company.

It is illegal to knowingly classify an employee as an independent contractor in order to avoid Affirmative Action recruitment efforts, and or payment of employment taxes, fringe benefits, etc. The IRS imposes fines and penalties for misclassification of service.

Liability may include payment for:

  • Employee's share of Social Security and Medicare taxes
  • Employer's share of Social Security and Medicare taxes
  • Unemployment taxes
  • Interest on money found to be owed
  • Civil fines

If found to be a criminal matter, imprisonment is possible.

Process for Engaging an Independent Contractor

Purchasing and Contract Services will process Independent contractors paid with sponsored or non-sponsored RF funds. Prior determination for the independent contractor will be needed in the form of a Purchase Order (PO) using the procedures in this section.

Contact an Expert

For questions, email Independent-Contractors@buffalo.edu or contact one of the subject matter experts listed in this section.

For Independent Contractor Classification Determination

For Grant Budget, PTA and Restrictions of Employee

For Processing and Purchase Orders to Classified Independent Contractors

For Payment Status and Method

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