DEFINITIONS OF EMPLOYEE AND CONSULTANT
The University has definitions for employee and consultant status which ensure that BGSU is in compliance with appropriate federal and state laws. In addition, these definitions have led to the establishment of Letters of Appointment and guidelines for their use. The Letter of Appointment is multi-part form and available from the Office of Human Resources.
In order to determine who is to be considered an employee of or a consultant to the University for compensation purposes, the following definitions apply:
Employee--A person who performs services subject to the will and control of the University (the employer). The University decides what shall be done and how it is done and has the legal right to control both the method and the result of the services regardless of the amount of discretion and freedom of action permitted. In most cases, the University also provides office space, facilities, tools, equipment, and/or other resources necessary to accomplish the task. The person may work on a full-time or part-time basis throughout the year or just at designated times; hours are set by the University. A continuing relationship exists. The University decides what the employee will be paid and regular payments are made by the University. The method of payment is either hourly or monthly through the Payroll Office with required tax and retirement deductions.
Consultant--A person who serves as an independent contractor and/or who is in business for him/herself. The person provides personal, professional services which are purchased by the University. A person who follows an independent trade in which he/she offers his/her services to the public is a consultant and provides his/her own liability coverage. A person who is employed elsewhere and provides a service to the University of a specialized nature (e.g., commencement speaker, guest lecturer, architectural consultant) is a consultant. The payment for services is not determined by the University but is controlled by the consultant or by some other external agency/organization. In most cases, the person provides his/her own office space, facilities, tools, equipment, and/or other resources necessary to accomplish the task. The nature of the work is such that it is not and cannot be performed by employees of the University. The method of payment is by consultant fee form processed through the Business Office. No tax or retirement deductions are made.
Those individuals whose service to the University corresponds with the new definition of "consultant" will be paid through the Business Office via a consultant fee form. Individuals whose service corresponds with the "employee" definition should be placed in faculty, administrative staff, classified or student status as appropriate. It is possible that some individuals falling under the definition of "employee" by the nature of the work they perform for the University may not readily relate to faculty, administrative staff, classified, or student status. For that reason, Letters of Appointment may be used. As an "appointee" and individual is considered an employee who signs a written agreement with the University.
In general, the Letter of Appointment (for non-student assignments) should be used to place an individual on the payroll as an "appointee" if the work assignment corresponds with the definition of "employee" and if the assignment does not clearly relate to faculty, administrative staff, or classified status. Appointees work for a limited period of time, but no longer than one year. Their benefits are limited to Worker's Compensation, a parking decal, Medicare coverage, and retirement (if requested). The Letter of Appointment indicates the type of assignment, rate of pay (hourly, monthly, or total) and the period of employment. It must be signed by the appointee, the initiator, and the contracting officer. As required by federal law, an Employment Eligibility Verification (Form I-9) must be completed for these employees. Because an appointee is in a temporary assignment, funding is through the operating budget of the hiring department. The guidelines for the Letter of Appointment should not be used for compensating faculty or administrative staff members performing assignments outside of and in addition to their regular duties. Instead, supplemental payment forms or addenda to a contract should be used.