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California State University, Long BeachCalifornia State University, Long Beach


Department Independent Contractor

Determination of Independent Contractor

Departments must follow the steps below to determine whether an independent contractor can be retained to perform personal or professional services. As a general rule, individuals should be classified as independent contractors on an exception basis only. Departments must follow the appropriate hiring procedures established by Staff Human Resources (Staff HR) or Faculty Affairs if it is determined that the necessary services must be performed by a university employee.

Step 1 – Pre-Approved Independent Contractors

If the department is requesting approval to retain services which include one of the “Pre-Approved Independent Contractors” shown below and can answer “NO” to all the Durations and Payment Specifications questions, the department can skip Steps 2 – 4(a). (Steps 4(b) – 6 must be completed.)

Pre-Approved Independent Contractors*

  • Article or Program Evaluator/Reviewer/Appraiser/Editor
  • Guest Speaker/Lecturer
  • Guest Artist/Musician
  • Guest/Life Model
  • Technical/Class Demonstrator

*Must meet Duration and Payment Specifications below.

Duration and Payment Specifications

  • Is the individual legally restricted from working for the university? (See Residency Status section below)
  • Is the individual a current CSU employee or has been an employee within the past two years? (exceptions apply, contact Director, HRSG for guidance);
  • Is the work non-academically related?
  • Is the work a recurring activity (exceptions may apply, contact Director HRSG for guidance) that will extend for 10 days or more per engagement per semester?
  • Will payment be $5,000 or more per engagement?
  • Must the work be reviewed by Risk Management as specified in the Guidelines for Independent Contractor Review by Procurement Department?

Step 2 – Review of the IRS 20 Determination Factors and Limitations/Restrictions

The department’s appropriate administrator must review both the IRS 20 Determination Factors and Other Limitations/Restrictions to ensure the individual can be classified as an independent contractor. If the individual should be hired as a university employee, the department must contact Staff Human Resources or Faculty Affairs for further guidance.

Other Limitations/Restrictions

Documentation Required for Independent Contractor Status

Step 3 – Complete an Independent Contractor Pre-Hire Worksheet Authorization

If the department determines the work should be performed by an independent contractor, the appropriate administrator must complete an Independent Contractor Pre-Hire Worksheet Authorization and submit it to the Director, Human Resources Service Group for final review and verification of independent contractor status. If the Authorization is denied, the department must consider hiring the individual as an employee. Contact Staff Human Resources or Faculty Affairs for further guidance.

Note: Before moving-forward, department must ensure independent contractor is legally able to work. See Step 5 for further details.

Step 4 (a) – Engagement of Independent Contractor for Services

The engagement of an independent contractor for services is generally covered by the university's standard requisition and general terms and conditions of service. A specific independent contractor agreement also may be used. Agreements must be reviewed and signed by Procurement & Contractual Services in accordance with the Purchasing Delegation Guideline.

The following forms/documents must be provided to Procurement & Contractual Services prior to retaining services:

  • Approved Independent Contractor Pre-Hire Worksheet Authorization (See Step 3)
  • Online Requisition
  • Scope of Work
  • Proof of Insurance (including Certificate of Insurance with Additional Insured Endorsement)

Online Requisition

If required, a requisition must be processed through the university’s Financial Common Management PeopleSoft system. All completed requisitions for independent contractor services must contain the following information:

  • The name of the individual performing the personal services;
  • A description, in appropriate detail, of the services to be performed;
  • Duration (term) of the work to be performed;
  • Where the work will be performed:
  • When the work will be performed;
  • Whether university supplies or equipment will be used;
  • The amount of payment requested by the independent contractor and the method of computation, i.e., by the hour, day, or job (the number of hours and days should be included, if applicable);
  • A total “Not to Exceed”dollar amount;
  • Whether the individual is presently employed by the university (regardless of campus location); and
  • Whether the individual is related to a university employee and the relationship to that employee.

Scope of Work

Departments must provide a Scope of Work to Procurement & Contractual Services. It must describe the work to be provided and can be submitted as an attachment to an online requisition or as part of the independent contractor provided agreement.

Independent Contractor Agreement

The requisition is processed by Procurement & Contractual Services, including obtaining the independent contractor's original signature on the agreement form PRIOR to the provision of service. In accordance with the Purchasing Delegation Guideline, the Director of Procurement & Contractual Services will sign the agreement on behalf of the university. If the independent contractor fails or refuses to sign the Agreement, the department cannot allow the contractor to provide services. Payment will not be issued for any independent contractor not signing an approved independent contractor agreement.

Proof of Insurance (including Certificate of Insurance with Additional Insured Endorsement)

Individuals retained as independent contractors must show evidence of adequate insurance coverage. If an independent contractor fails to have and maintain insurance of the type and class required, CSU reserves the right to purchase insurance on the contractor’s behalf and to offset any costs for insurance to any monies to be paid to the contractor. In some instances, insurance may be waived. Consult with the university's Risk Manager to determine the appropriate insurance coverage.

Proof of Background Check (if required)

Independent contractors, consultants, auxiliaries and outside entities who operate under the CSU name or on CSU property are responsible for ensuring that they and/or their employees have had background checks if they perform duties and are defined as sensitive. This includes individuals who are in positions subject to legal background check requirements and/or who perform work or independent contractors entities must provide confirmation of completed and cleared background checks. For administration and/or guidelines pertaining to background check requirements for independent contractors, please refer to the Integrated CSU Administrative Manual (ICSUAM) at, and contact Procurement and Contractual Services.

Step 4 (b) – Engagement of Pre-Approved Independent Contractor for Services

If the department is requesting to retain services for one of the Pre-Approved Independent Contractors shown in Step 1 AND the answers to all the Durations and Payment Specifications questions are “NO,” then the department must provide a Pre-Approved Independent Contractor Engagement Letter to the individual prior to services being performed. This letter is to be provided as supporting documentation when submitting the Pre-Approved Independent Contractor Payment Request (See Step 6 for details) form to Accounts Payable when services have been rendered.

Foreign National Independent Contractors

Step 5 – Check Residency Status for Employment and Tax/Reporting Purposes

The following completed forms must be provided to the Accounts Payable’s Tax Specialist before retaining the services of a foreign national:

If the independent contractor (individual or company) is a nonresident alien (NRA), or if the department is unsure of the residency status of the independent contractor, contact the university’s Tax Specialist PRIOR to retaining services. The Tax Specialist MUST verify residency status and/or Visa status prior to a department making a commitment to retain the independent contractor. Failure to do so may result in the university being unable to enter in to the agreement. Requesting department may also be subject to tax liability.

As a nonresident alien, the individual may be limited to the length and frequency of work that can be performed. Employment terms and proper tax reporting are subject to the Tax Specialist’s review of all information submitted.

Step 6 – Payment for Services

No payment for services may be authorized unless the below conditions have been met:

  • a) All agreements, including amendments, have been fully executed; and
  • b) All the requisite documents have been received and approved (See Steps 3 and 4 above for details).

Submit Payment Documentation to Accounts Payable

Once service has been provided, the department’s appropriate administrator must approve payment by signing off on the independent contractor’s invoice and forward, along with the Vendor Data Record Form (STD 204) to Accounts Payable for payment processing. All documents must be forwarded to Accounts Payable for payment.

Independent Contractor Invoice

The invoice must include the following information.

  • Purchase order number;
  • Name of entity/contractor;
  • Amount being billed;
  • Remit to address;
  • Payment terms;
  • Description of service; and
  • Period of performance (it should be so stated if the invoice is a progress billing).

Note: Invoice must contain the appropriate administrator’s name/signature as well the appropriate accounting chart fields.

Special Note for Pre-Approved Independent Contractors Upon completion of services, the department must submit the Pre-Approved Independent Contractor Payment Request and the Pre-Approved Independent Contractor Engagement Letter to AP for payment. An invoice is not required for Pre-Approved Independent Contractors.

Vendor Data Record form (STD 204)

The Vendor Data Record Form should be completed before work commences but must be completed before payment can be issued. This form is mandatory for all vendors paid by the university. If the department believes the individual has performed independent contractor services for the university previously, the department may contact Accounts Payable to inquire if a Vendor Data Record for the individual is already on file.

Payment Timeframe

If Accounts Payable receives all required properly completed documentation, payment will be processed within two weeks or less and mailed to the independent contractor.

Reportable Payments

  • Accounts Payable will retain the Vendor Data Record Form on file for audit purposes as required by the State.
  • Accounts Payable will issue Form 1099, as required by law, to any independent contractor receiving payment(s) from the university totaling more than $600.00 within a calendar year.
  • If the independent contractor is a non-resident of California, tax must be withheld if payment exceeds or will exceed $1,500.00 within a calendar year. Withholding will occur at a rate of 7%. Franchise Tax Board Form 592-B will be issued to independent contractors for whom State tax has been withheld.
  • Non-resident alien (NRA) independent contractors are handled on a case-by-case basis, as visa status and specific country treaties must be taken into account to determine tax withholding percentages. See IRS Form 1042-S for more information.


Procurement & Contractual Services

  • Engagement and Approval of Independent Contractor
  • Independent Contractor Agreement Insurance Requirements
  • Insurance Requirements

Accounts Payable

  • Form 592-B and State withholding information
  • Form 1099-MISC information
  • Form 1042-S information
  • Independent contractor invoice and its completion
  • Non-Resident Alien or foreign national independent contractors
  • Payment status questions
  • Vendor Data Record Form (STD 204) and its completion

Director, Human Resources Service Group

  • Independent contractor determination and verification
  • State Contract Code interpretation (HR 2003-21)

Staff HR and Faculty Affairs

  • Collective bargaining and non-represented employee work interpretations
  • Employee hiring process