What you should know when engaging contractors to provide services for the University
Staff of the University may engage contractors to provide paid services to the organisation. Prior to engaging a contractor, it is essential to determine if it is appropriate to engage them as a contractor and the method for payment.
Contractors are not employees of the University, however, there are circumstances in which employer obligations such as superannuation and payroll tax apply to these individuals. In these circumstances the contractor must be paid through the Human Resources Contractor payment process.
To help you manage this, the University has improved the processes relating to decisions and payments for contractors. The HR Contractor Management website has comprehensive guidelines and information on the new processes that apply from 22 August 2022.
What do I need to do?
1. Register and attend an upcoming webinar
Webinars will be available to staff with information, demonstrations of the new processes and provide an opportunity to ask questions. Staff who are directly involved in the engagement and payment of contractors are encouraged to attend:
- Thursday August 18, 10.30am – register here
- Wednesday, August 24, 10.30am – register here
- Wednesday, August 31, 10.30am – register here
2. Be familiar with the University guidelines for engaging contractors
There are lots of factors that determine whether an individual can be engaged as a contractor. For example;
- Engagement of independent contractors for teaching and related duties, can only be done by way of an employment contract
- Former staff can only be engaged as a contractor, providing a 3-month break in service has occurred and if the services differ from the work they were previously undertaking
- Existing staff may not be engaged as a contractor concurrently with their employment
- Retired staff holding honorary titles and supporting the delivery of courses may not be engaged as contractors
- Payment to volunteers (specifically clinical research patients) must be expressed as a fixed honorarium value and not as an hourly rate
- For the engagement of individuals based off-shore, contact your HR Advisor in the first instance – for advice PRIOR to the engagement. In some circumstances an exemption will be required from the Executive Director, Human Resources, before an individual residing offshore can perform work for the University.
Advice should be sought about engagement of external parties prior to any work commencing. The HR Contractor Management website has comprehensive guidelines and resources to assist and HR teams will work with University staff and Legal and Risk to determine the best way forward to achieve the outcomes needed for the organisation.
3. Make sure that staff in my area are aware of their obligations with contractors
It is important that there is assessment of contracting arrangements prior to work commencing. This applies to work conducted in support of academic activities (teaching or research) where payments to third parties are involved. Please help by distributing this information to staff in your area as applicable and including in your ongoing business processes.
4. Perform a contractor engagement assessment
The contractor engagement assessment form is an online assessment form that will help advise staff on the engagement method and payment pathway for contractors. It replaces previous contractor questionnaires.
The assessment is required for any engagement with a new contractor or where there is a change to the nature of the services being conducted. It will require supporting documentation such as a Consulting Services Agreement.
5. Request payments for contractors
If you are advised by HR that employer entitlements apply to the contracting engagement, payments will need to be made via a HR eform for Contingent Worker Payments. Supporting payment and contract documents will be required. The HR system will then pay the contractor for the goods and/or services provided with any additional on costs or deductions (superannuation, payroll tax, PAYG withholding).