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Independent Contractor or Payroll Examples

 An independent contractor typically does the same type of work for other companies, etc. Their resume shows where they have provided this same service. The individual has a direct interest in the profitability of the work accomplished. Depending on the project, the individual has the potential of suffering a financial loss.

An independent contractor, such as a guest lecturer, is typically considered an expert on a specific topic. The individual is available to come to campus to lead a discussion on his specific area of expertise. Their knowledge provides additional information to faculty, staff, students, public, etc.
An employee is told what needs to be done, how work needs to be done and where it needs to be done. There is someone available to answer questions, provide guidance, direction and supervision for the individual. Employees are assigned a certain work schedule. If the employee is exempt under FLSA, they may not receive a great deal of oversight, may exercise independent judgment and discretion within parameters and may have a fairly flexible work schedule.
An employee can be an expert in the subject, but has been hired to teach a specific class based on his/her area of expertise. The individual is an employee since he/she will test and grade the class participants on the information provided. An employee is typically provided the tools and materials needed to complete the job, whereas independent contractors typically provide their own tools and materials.

A current employee, including faculty, staff, GTAs, GRAs, student workers, etc. must be paid via payroll, no matter what type of job they are performing. A current employee cannot be considered an independent contractor. An employee from another state agency is also considered an employee, and must be paid via payroll.

It does not matter if the person is being paid one time or multiple times, the decision is based on the work being performed.

Examples:

  • A person is paid $2,000 to design a stage. The University provides a deadline for the final product, but they do not stipulate how many hours the individual works on the project. The individual will be paid only $2,000 regardless of the number of hours it takes to complete the design. The individual cannot be supervising any KU employees.
    • Pay as independent contractor.
  • An individual is hired to paint scenery for a play. They are being provided the materials to paint, they are told what needs to be painted, but they don’t always have to work the same hours.
    • Pay as temporary employee.
  • An individual is hired to talk about the research he has done on enzymes.
    • Pay as independent contractor.
  • A former Senator is hired to teach a class on how the Senate operates as part of the US Government. He will grade each class participant.
    • Pay as temporary employee.
  • An individual oversees the work of a KU employee, student hourly, etc.
    • Pay as employee.
  • An individual is hired to provide instruction on playing jazz music for Music Camp.
    • Pay as independent contractor.
  • An individual is hired to supervise and monitor camp participants who are staying in the resident halls.
    • Pay as temporary employee.
  • An individual is hired to play in the orchestra for a play, or accompany a student for a recital/performance. The individual is told what music to play, dates and times that they will be required to play and rehearsals could be required. The individual may be expected to practice and prepare for the performance on his or her own time.
    • Pay as temporary employee.

Summary:
These are only a few examples. If you have a specific situation, please contact Central Accounting with the details. We will be happy to review the situation, and work with Human Resources and Equal Opportunity (HR/EO) to determine how best to pay the individual. Since the federal Fair Labor Standards Act also dictates what is considered “work” for an employee, consultation may be required between Central Accounting and HR/EO before a final determination is made.

Pursuant to K.S.A. 70-3228, any person knowingly and intentionally misclassifying an employee as an independent contractor for the sole or primary purpose of avoiding either state income tax withholding and reporting requirements or state unemployment insurance contributions reporting requirement may be dismissed, subject to fines, and/or imprisonment.


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