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Contractors and Consultants procedure

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Section 1 - Preamble

(1) This Procedure was approved by the Vice-Chancellor on 19 October 2005 and incorporates all amendments to 17 July 2015.

(2) This Procedure is pursuant to the Contracts policy and includes the following schedule:

  1. Schedule A: Superannuation Guarantee for Individuals Guidelines.
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Section 2 - Purpose

(3) This Procedure documents the requirements that apply to contracts for the supply of services to the University.

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Section 3 - Scope

(4) This Procedure applies to all contracts for the supply of services to the University except contracts that also include the supply of goods where the value of the goods is greater than 80% of the total value of the contract. This procedure does not apply to the engagement of external legal advisers, which is dealt with by the University Solicitor's Office's.

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Section 4 - Policy

(5) This Procedure is pursuant to the Contracts policy.

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Section 5 - Procedure

Part A - General requirements

(6) A company or an individual may be engaged as a contractor by the University on the following conditions:

  1. The contractor must have a current Australian Business Number (ABN) (subject to the exception in Clause 5)
  2. The contractor must hold, and have provided certificates of cover for, the following insurances (unless an exemption has been granted by the Director, Corporate Finance):
    1. public liability insurance for an amount not less than $5 million in respect of any claim
    2. professional indemnity insurance for an amount not less than $2 million in respect of any claim subject to the following:contractors engaged by Corporate Finance, are exempt from the professional indemnity insurance requirement, where the type of work / service being procured / provided is limited to minor repair / rectification / installation activities which do not include any design / engineering activities — such activities must be appropriately supervised by Corporate Finance.in all other instances, contractors engaged by Corporate Finance, are not exempt from the professional indemnity insurance requirement
    3. worker's compensation insurance (in the case of a company) in respect of its employees and sub-contractors as required by applicable law.
  3. If the contractor is an individual, a determination must be made in accordance with Part B of this procedure that the individual can be engaged as a contractor.
  4. If the contractor is a company, a determination must be made in accordance with Part C of this procedure that the company can be engaged as a contractor.

(7) Overseas suppliers not carrying on an enterprise in Australia must provide the University with a completed Australian Taxation Office 'Statement by a Supplier' confirming that they are not entitled to an ABN.

Part B - Engaging individuals as contractors

(8) When a Faculty or other organisational unit of the University proposes to engage an individual to supply services, it must be determined whether that individual is to be engaged as either:

  1. a contractor (in which case the individual will be paid through the Corporate Finance (FSD) accounts payable system), or
  2. an employee engaged under an employment contract (in which case the individual will be paid through the Human Resources Division (HRD) payroll system).

(9) Individuals may be engaged as contractors in the following circumstances, on the basis of an assessment by the Contractor Officer (the Contractor Checklist and Certification for Individuals is not required in these instances):

  1. procurement of professional services (i.e. services provided by qualified professional personnel such as architectural, engineering, business, planning, project management, contract management, policy, graphic design, accounting, medical, or recruitment agency services, with the exception of the procurement of external legal services which is dealt with by the University Solicitor's Office's);
  2. procurement of trade services;
  3. procurement of entertainment and performing arts services;
  4. procurement of work undertaken outside Australia by overseas service providers;
  5. engagement of an individual where a previous determination has been made by the Taxation Manager, within the last 12 months that the individual is suitable to be engaged as a contractor.

(10) In all other cases, the Contractor Officer must make an initial assessment as to whether an individual should be engaged as a contractor or an employee by completing the Contractor Checklist and Certification for Individuals.

(11) Generally, individuals who are engaged to provide core services of the University must be engaged as employees rather than contractors. Notable exceptions to this rule are specified in Clause 9. The Contractor Checklist and Certification for Individuals includes guidance about what is considered 'core services of the University'.

(12) The following types of individuals who provide core services may be engaged as contractors on the basis of an assessment by the Contractor Officer using the Contractor Checklist and Certification for Individuals :

  1. Guest speakers or presenters may be engaged as contractors where all of the following apply:
    1. the engagement is on a one-off or short-term basis to present or speak in their field of expertise;
    2. the speaker or presenter is not engaged for any period exceeding five days per calendar year;
    3. the speaker or presenter is not under the control of the University (see Contractors and Consultants HELP webpage);
    4. the speaker or presenter is not merely acting as a substitute for lecturers, tutors or teachers in the delivery of course curriculum.
  2. Suppliers of specialist education and development programs (including presenters, facilitators and course writers/developers) may be engaged as contractors where all of the following apply:
    1. the supplier is not engaged for any period exceeding 20 days per calendar year
    2. the supplier is not under the control of the University (see Contractors and Consultants HELP webpage)
    3. in the case of presenters and facilitators, the supplier must be required to devise the program, arrange topics and provide materials and intellectual property.

(13) Where the Contractor Officer makes an initial assessment that the individual may be engaged as a contractor, the Contractor Officer must forward the completed Contractor Checklist and Certification for Individuals to the Taxation Manager for a final determination, unless Clause 9 applies.

(14) Where Clause 9 applies, the completed Contractor Checklist and Certification for Individuals does not need to be sent to the Taxation Manager for a final determination and must be retained by the Contractor Officer.

(15) The Taxation Manager, or nominee will advise Contractor Officers of the outcome of final determinations, within 2 working days of receipt and will retain a copy of all contractor determinations and correspondence.

(16) Where it is determined that an individual may be engaged as a contractor, rather than an employee, Parts D, E and F of this procedure will apply.

(17) Where it is determined that an individual should be engaged as an employee, the Contractor Officer will refer the matter to HRD for advice about the recruitment process.

Part C - Engaging companies as contractors

(18) When a Faculty or other organisational unit proposes to engage a contractor to supply services and the contractor is a company, the Contractor Officer is responsible for determining whether the engagement of that company would fall within the scope of arrangements considered permissible by the University.

(19) The following arrangements with companies are prohibited by the University:

  1. A contractual arrangement with a company is prohibited where that company is owned by a University employee or a close family member of the employee. Close family members of employees are those family members who may be expected to influence, or be influenced by, the employee in their dealings with the University. This may include the employee's children and partner, children of the employee's partner and other dependents of the employee or the employee's partner. A University employee includes:
    1. an employee of a University subsidiary company;
    2. a past employee whose employment with the University concluded within the previous three months and who now provides similar services to those performed during their employment with the University.
  2. A contractual arrangement with a company is prohibited where that company is not bona fide, that is, a company that is not registered with the Australian Securities and Investments Commission and does not quote an Australian Company Number (ACN) and an ABN on all invoices and letterhead. This prohibition does not apply to duly incorporated / registered overseas entities whereby sufficient evidence of such is provided and verified with the applicable government authority.
  3. A contractual arrangement with a company is prohibited where that company does not genuinely provide to the public the services that they provide to the University, and where the company does not service a range of clients.

(20) When determining whether an arrangement with a company is permissible in accordance with Clause 18, the Contractor Officer must base their determination on documentation verifying the nature of the company. Such documentation may be a business CV or information from a company's website.

(21) Where it is determined that a company may be engaged as a contractor, Parts D and F of this procedure will apply.

Part D - Engaging a contractor

(22) The engagement of contractors may be effected by purchase order without the need for a written agreement where the Contractor Officer is satisfied that the contractor meets the requirements of Part A of this procedure and each of the following apply:

  1. the value of the services to be supplied is $15,000 or less (excluding GST);
  2. no special terms and conditions apply;
  3. a preliminary risk assessment of the services has been made in accordance with the Risk Management Procedure and the risk is rated as low.

(23) In all other circumstances, the engagement of contractors to supply services to the University must be recorded in a written and executed agreement.

(24) Contractor Officers should use the standard agreements available on the University Solicitor's Office webpage. The University Solicitor's Agreement Instruction Guide sets out the circumstances in which these standard agreements may be used. The standard agreements available from the University Solicitor's Office are effectively pre-approved by the University Solicitor's Office. Where these are used without any amendments no further approval is required from the University Solicitor's Office.

(25) If amendments are required to the terms and conditions of a standard agreement, the University Solicitor's Office must be instructed to draft the amendments, or, if the amendments were requested by the contractor, to review the amendments.

(26) If the contractor is not willing to use the University's form of agreement and has supplied their own, the Contractor Officer must refer the agreement to the Office of the University Solicitor for review.

(27) Where a contractual agreement has been submitted to the University Solicitor's Office and further negotiation of the terms of the contract occurs, the Contractor Officer must ensure that the final version agreed between the University and the contractor has been approved by the University Solicitor's Office.

(28) When the final form of the contract has been agreed, the Contractor Officer is responsible for ensuring that the contract is approved and signed in accordance with the Contracts policy.

Part E - Superannuation guarantee determination for individual contractors

(29) The Contractor Officer must assess whether an individual contractor is subject to the Superannuation Guarantee (SG) charge in accordance with the Schedule A: Superannuation Guarantee for Individuals Guidelines. If SG payments apply, the Contractor Officer must administer those payments in accordance with the provisions of Schedule A: Superannuation Guarantee for Individuals Guidelines.

Part F - Recording contractor details and payment of contractors

(30) Contractor Officers must maintain records in accordance with the University's Information and Records Management policy and Procedure. Contractor Officers must keep written records supporting any determinations that they make. The following must be entered into the Deakin Contracts Records System (DCRS) (authorised staff only):

  1. determinations made by the Taxation Manager under Part B of this procedure;
  2. written agreements established under Part D of this procedure.

(31) To facilitate payment of a contractor, Contractor Officers must submit the contractor's invoice to Corporate Finance, quoting the approval number generated by the DCRS.

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Section 6 - Definitions

(32) For the purpose of this Procedure:

  1. contractor: a company or an individual (other than a University employee) engaged to provide services to the University. Contractors include consultants.
  2. contractor officer: the staff member who is responsible for the administration of the engagement of contractors for an organisational unit. Contractor officers may be the senior financial or administrative officer within a School, Division or other organisational unit.
  3. individual: for the purposes of this procedure, an individual is considered to be a natural person or multiple persons who conduct their affairs through a partnership arrangement.
  4. services: work which involves the personal labour of one or more individuals including mental, artistic or physical work. The supply of services is distinct from the supply of goods.