Engaging
Independent Contractors
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This type of arrangement is most often appropriate when a project is limited in length and scope. Contractors are typically paid a fixed rate per project after a deliverable or upon receipt of an invoice for services. To use this option, the Program may identify an Independent Contractor. A country specific agreement will need to be drafted and signed (signing the statement of work or independent contractor agreement is an important and necessary step).
Classification of Independent Contractors/International Context
In most countries, a worker is assumed to be an employee unless he or she qualifies as an independent contractor by meeting certain criteria. The criteria vary from country to country, but the following qualities tend to be globally important for independent contractor determination:
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Control over how, when, and where the work is done
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A business of doing similar work for other clients (also as a contractor)
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Use of own office, other facilities, and equipment
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Payment of own business expenses
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Pay based solely on services rendered (e.g. no vacation pay)
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Defined project or contract end date
The Program must be aware of both home and host country labor classification laws as a worker could be reclassified by either country’s legislation. Penn’s Service Provider Questionnaire (SPQ) – completed by the potential service provider, and Service Provider Evaluation Worksheet (SPE) – completed by the hiring manger in concert with the school/center HR director, are used to evaluate the relationship of the service provider and the University. In recent years, the US Department of Labor (DOL) has strengthened US domestic classification regulations for independent contractors. Although the modifications of the US guidelines are based on work in the US, Penn will use these forms, along with the host country’s regulations, when determining the appropriate worker status for individuals performing services outside of the US.
