Procuring Professional Services
Two different forms, the Personal/Professional Services Contract (PSC) and Personal Services Invoice (PSI), are used to procure personal/professional services from Independent Contractors. PLEASE NOTE: A person performing services under a PSI or PSC must be an Independent Contractor, not a PSU Employee. Using the Employee vs. Independent Contractor Checklist, you can determine whether the person providing services is an independent contractor or an employee. This is an important step because there are financial consequences if the IRS determines PSU misclassified a service provider.
Independent Contractor: An Independent Contractor is an individual/firm that is not subject to PSU direction and control. Independent Contractors hire or dismiss their own associates, provide their own tools and equipment, advertise their services to other clients, are free to choose work methods, and carry their own insurance.
Employee: An Employee is an individual who is subject to PSU direction and control. An Employee can be dismissed or terminated “at will.” An Employee is provided a workplace and tools by PSU, and is covered by PSU Workers’ Compensation and Liability Insurance. PSU has the right to control and direct an Employee’s performance of the work, not only as to the result to be accomplished but also as to the details and means by which that result is accomplished.
Former PSU Employees: Generally, a former PSU employee cannot perform services for PSU under a PSI or PSC during the same calendar year that they were paid on payroll as an Employee. A prior employee should NEVER perform services under a PSI or PSC that are the same, or significantly similar to the work they performed while an Employee.
If it is determined that the relationship you are considering falls into the Employer/Employee category, you must contact Human Resources by email at firstname.lastname@example.org or by phone at 5-4926 to determine the appropriate mechanism for hiring the individual.
The Personal/Professional Services Contract (PSC) and Personal Services Invoice (PSI), are used to procure personal/professional services from Independent Contractors. These forms should be used for infrequent, technical, and unique services performed by contractors with specialized expertise of a technical, scientific, or artistic nature. The selection criteria for these services may include but are not limited to the contractor’s skill, knowledge, reputation, and/or creativity. The cost of the service may be a secondary factor in the selection of the specific contractor. Neither form can not be used for trade services. Trade services are those services that involve the application of manual or mechanical labor such as work performed by plumbers, electricians, or locksmiths. If procuring trade services, please contact Project Accounting.
The PSI MAY be used:
- For services costing $5,000 or less;
- If total payments paid to the contractor by your department in the calendar year does not exceed $5,000;
- Where a single payment will be made; AND
- When the contract end date extends less than three weeks into the future or the services have already been performed.
The PSI cannot be used to procure services from a Non-Resident Alien or Foreign Entity.
The PSC MUST be used:
- For services costing greater than $5,000;
- If total payments paid to the contractor by your department in the calendar year exceeds $5,000;
- Where multiple payments will be made; OR
- When the contract end date extends more than three weeks into the future.
The PSC must be used to procure services from a Non-Resident Alien and Foreign Entity.
A person performing services under a PSC or PSI must be an Independent Contractor, not an Employee.
Pursuant to Solicitation Thresholds, Contracts for Goods & Services valued over $25,000 (or $10,000 if using Federal Funds) must be sent out for solicitation via either an informal or formal solicitation process. If a department is executing a Contract for Goods & Services valued over $25,000 (or $10,000 if using Federal Funds), the department must complete the Solicitation Request Form and submit it to CAPS at email@example.com. Upon receipt of the form, a CAPS Contract Officer will review the request and work on drafting the informal or formal solicitation process documentation.