Section: CSU POLICY MANUAL FOR CONTRACTING & PROCUREMENT
|Section 5000 Policies|
Policy Number: 5412.0
Policy Title: Special Processing Requirements for Contracts
Policy Effective Date: April 28, 2008
Last Revision Date:
(see revision history)
To establish system wide contracting and procurement policy as required by Education Code 89036.
100 Commencement of Work Clause
Except in cases of emergency to protect human life or State property, work shall not commence on any contract until the contract has been approved by the appropriate authority. Any work performed by the contractor before the date of approval can be considered as having been done at the contractor's own risk and as volunteer work.
Payment and consideration provisions depend on the complexity and difficulty of the project, the current rate for similar work both within and outside State service, and the qualifications and experience of the individual(s) or firm awarded the contract. Contracts will list the rate of compensation to be paid for all consideration and other expenses.
Reimbursement of transportation costs and an allowance for per diem should be in conformance with the current CSU reimbursement policies applicable to CSU professional employees (CSU Internal Regulations).
300 Progress Payments
A "progress payment" is defined as any partial payment of the contract price during the progress of the work. If a provision in the contract calls for progress payments to be made, they shall be made at clearly identifiable stages of progress, and be based upon written progress reports submitted with the contractor's invoices. Progress payments shall not be made in advance of services rendered.
700 Hazardous Materials Removal Services Contracts
These services include all labor, packaging, materials, tools, vehicles, placards, labels/markings, equipment, including personal protective equipment and safety equipment, expertise, and other means necessary and required to provide services for the pickup, transportation, and disposal of hazardous wastes.
Contracts involving the handling, removal or disposal of hazardous materials shall be developed in accordance with CSU's model contract for hazardous material removal, and comply with all State and Federal requirements. Changes to the hazardous materials model contract may be made with the concurrence of campus Risk Management and Environmental Health and Safety.
800 Insurance Requirements
Campuses should perform a risk identification and evaluation, in accordance with policy section 230, as part of its development the insurance requirements for contracts for the procurement of hazardous materials removal services.
In the absence of a risk identification and evaluation, the minimum insurance requirements set forth in policy section 230.02 shall be used.
900 Independent Contractors
The following guidelines are provided to assist in the distinction between employer/employee vs. independent contractor relationships. These guidelines are based upon criteria used by the Internal Revenue Service, the State Employment Development Division, and other public service agencies.
- An independent contractor generally is engaged in a distinct occupation or profession, e.g., in the business of providing consulting or other services related to the job being contracted.
- Independent contractors perform independently; whereas, under an employer/employee relationship the employer retains the right to direct and control the work being performed, as well as control over the details or techniques of the work to be performed.
- The working area, supplies, and/or equipment generally is not furnished to independent contractors.
- Compensation for independent contractors is reflective of the specific work accomplished; whereas, employment relationships are generally compensated by payment of a set sum by the hour, week or month based on set hours of work.
- The work being performed must not be of a type that is integrated into routine or ongoing employer operations.
- The employer must not make direct payments for business, per diem, or travel expenses incurred by the independent contractor.
- An employment relationship exists when the worker can quit or be terminated at any time; whereas, an independent contractor is legally obligated for failure to complete the job unless the agreement is terminated.
1000 Consulting Agreements (Rev. 04/20/04)
A "consulting services contract" is defined as an agreement with an independent contractor to have work performed that is advisory in nature, provides a recommended course of action or personal expertise, and results in an end product that is basically a transmittal of information, either written or verbal.
A "consulting services contract" does not include:
- Contracts with the federal government.
- Contracts with local agencies (as defined in Section 2211 of the Revenue and Taxation Code) to subvene federal funds for which no matching State funds are required.
- Contracts for the development, maintenance, administration, or use of licensing or proficiency testing examinations (such as academic accreditations, program reviews, and other external evaluations).
- Contracts for public works architectural or engineering services.
Consulting agreements are subject to the same policies and procedures as service agreements in general. Additional special processing requirements to be performed whenever a campus contracts with an independent contractor serving as a consultant include:
1100 Conflict of Interest
Should a consultant provide services for preparation or development of recommendations for the actions which are required, suggested or otherwise deemed appropriate, and which include the provision, acquisition or delivery of products or service; then the consultant must provide full disclosure of any financial interest, including but not limited to, service agreements, OEM, and/or remarketing agreement that may foreseeably allow the Contractor to materially benefit from the adoption of such recommendations.
No person, firm, or subsidiary thereof who has been awarded a consulting services contract may submit a bid for, nor be awarded a contract for, the provision of services, procurement of goods or supplies, or any other related action which is required, suggested, or otherwise deemed appropriate in the end product of the consulting services contract.
1200 Prohibition of Contracts with Illegal Immigrants
Per the State of California Executive Order W-135-96 signed on 8-27-96 by the Governor, all contracts must contain the following language: "If Contractor is a natural person, Contractor certifies by signing this Agreement that s/he is a citizen or national of the United States or otherwise qualified to receive public benefits under the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (P.L. 104-193; 110 STAT. 2105, 2268-69."
APPLICABILITY AND AREAS OF RESPONSIBILITY
RESOURCES AND REFERENCE MATERIALS
Sound Business Practices:
Laws, State Codes, Regulations and Mandates:
Reference: EO 849
Reference: Internal Revenue Code Sections 3121(d), 6651, 6656, 6662; State Management Memo 95-18 regarding Independent Contractor/Employee Payroll Taxes (Expires 7/31/2000).
Reference: Education Code Section 89036.
Reference: Government Code 81000 et seq., 82019; PCC Section 10830
COGNIZANT OFFICE(S)CO Manager:
Director, Contract Services & Procurement
CSU Office of the Chancellor
Director, Contract Services & Procurement
CSU Office of the Chancellor
Procurement and Support Services Officers