It is critical that Boston University correctly determine whether the individuals providing services to the University are employees or independent contractors. Employees receive W-2s, and the University withholds and pays employment taxes. Independent Contractors receive 1099s that report the compensation paid for services performed. The University normally does not withhold or pay taxes with respect to its independent contractors. Generally speaking, independent contractors are engaged in a business of their own, retain control over their schedule, hours worked, jobs accepted, and their performance. Additionally, they may invest in their own equipment, supplies, have other clients, and carry insurance. They may also perform a service that is not an integral part of the University’s mission.
Federal and state authorities have developed several tests for determining whether a worker should be classified as an employee or an independent contractor. Based upon these tests, the University developed the Worker Classification Pre-Qualifying Questionnaire (PQQ) for service providers claiming independent contractor status. The University will review the totality of the responses to the questions and circumstances and balance the factors to make a determination whether a worker is an independent contractor or employee. All factors are analyzed subjectively.
The PQQ has been integrated with the online supplier registration and is now available electronically. The PQQ, which must be completed by all individuals or sole proprietors before they are engaged by the University, can be found on the Sourcing and Procurement website.
Upon completion and submittal of the PQQ by the service provider, the Comptroller’s Office will review the online form and accompanying documentation to determine the proper classification of the service provider. If you have any questions, please email firstname.lastname@example.org or refer to the guidelines available on the Comptroller’s website and instructions provided on the Sourcing & Procurement website.