Identifying an Independent Contractor

Determining whether an individual is an employee or independent contractor can be easily identified by looking for a few clues.

  1. Is the individual using their personal Social Security Number rather than a separately issued business tax ID?
  2. Is the individual being paid under their own name rather than the name of a legal business entity?
  3. Is the individual working out of their home?
  4. Does the individual always seem to be working at NU?
  5. Is the individual now doing what they were doing as an employee?
  6. Is the individual performing responsibilities that are similar in nature to work performed by employees of the University?

If any of the above can be answered yes you need to apply the Test:

  • Does the individual operate an Independent Trade, Occupations or Business?
    • Runs own Business?
    • Has other Clients?
    • Not An on-going or frequent arrangement soley dedicated to the University?
  • Does the individual have Freedom from Control of University Employees?
    • Can they do what they want and how they want to do it?
    • Project based work?
    • Is the University simply interested in the result and not in the way it is accomplished?
    Is the work being performed outside the usual scope of our business?
    • Proof Reader/ Transcriptionist?
    • Insurance Consultant?
    • Website designer?

If they can pass the test whether they are in fact independent from the university, then they are an Independent Contractor/Consultant. There are specific guidelines a Unit/Department must follow in order to pay an Independent Contractor/Consultant. Click here to find out how.