Business Contracts & Consulting Agreements

BUSINESS CONTRACTS AND CONSULTANT AGREEMENTS DEFINITION

Business Contract: A formal contract between the University and an external company or individual to provide a service or product, i.e. lease of facilities and/or real property, services, and technical expertise.

Independent Consultant: An individual or organization outside the University of professional or technical competence that provides primarily professional or technical advice to the University, i.e. trainer, editor, web design.

SUMMARY OF POLICY

Business Contracts are used for the following types of transactions:

• Lease or rental of real property.
• Use of non-University facilities, including entering non-University land for testing, collection of samples, or construction.
• Use of proprietary materials such as published works, films, and University-owned software.
• Use or acquisition for goods or services, except for those goods and services customarily provided through the Purchasing Department

NOTE: If the other party does not present its own purchase order form and there is no need to establish terms and conditions (reimbursement for use of departmental supplies or services), a Special Sales/Service Authorization may be used (see Cash Collections).

• Engagement of an independent consultant to render advice of a professional or technical nature.
• Engagement of performers or nonacademic speakers for conferences or program events. (Academic speakers are generally paid an honorarium—see Honorarium section.)
• Agreements for educational and/or training services.
• All business transactions for which the University is asked to accept a non-University contract or purchase order, regardless of the type of work being performed.

PROCEDURES FOR PROCESSING REQUESTS FOR BUSINESS CONTRACTS OR A CONSULTANT AGREEMENT

• BUSINESS CONTRACT: Rewrite of this section is in process.  Contact your Regional Office for instructions in establishing a business contract.
• INDEPENDENT CONTRACT/CONSULTANT AGREEMENT: Complete the Purchase Requisition form. Attach a specific list or definition of what the consultant is going to do following the criteria identified in P&P 380-70. If a proposal has been submitted, attach it. Never sign this proposal. In general, be sure and give basics of Who, What, Where, When and Why.
• When requesting services from 'individuals' as Independent Contractors, please complete the entire Independent Contractor (Individual) Determination Pre-hire Worksheet. Complete all sections and a clear statement of the nature and purpose of the agreement. The County Director must sign as the Department Head. Attach this information to the Purchase Requistion form.

NOTE: This form is not needed if the contractor is a business.

• Send all completed forms and attachments to the Regional Office for processing.
• You will receive a copy of the signed agreement when complete.

TIPS

• NEVER sign a contract on behalf of the University. Forward all contracts to the Regional Office for processing.
• The UCD Business Contracts Office completes consultant agreements. UCD Purchasing or the Business Contracts Office will complete business contracts depending on the type of contract. Contracts are prepared and sent to the vendor/consultant and are not considered valid until signed and returned to their office. You should allow two months for the process to be complete. The contract or consultant agreement should always be signed and completed prior to beginning the service.
• If the County Director has signed a facility use agreement, the checking account can be used for payment. If an invoice will come forward for direct payment on your L account, or when additional liability language is required and you are not using the local checking account for payment, a Business Contract is required.
• Services (i.e. logo design, layout, temporary employment services, cleaning, crop destruction, etc.), no matter the dollar value , require a formal Contract through a UC Purchase Requisition.
• An employee cannot be a contractor. The general rule of thumb to identify the difference: If the University has the right to supervise and control the performance and results of that performance, then an employer-employee relationship exists. If the University has neither the right to control the results nor the manner of performance, then an Independent Consultant relationship exists.
• If you expect to pay an independent consultant more than $15,000 in any 12-month period, you'll need to submit three or more proposals for review and a clear written explanation of why you are selecting the chosen consultant.

REFERENCE/WEBSITE LINKS

UC Davis Policy & Procedure Manual, Section 330-05 Business Contracts:
Manuals /Policy and Procedure Manual (PPM) /330-05, Business & Revenue Contracts

UC Davis Policy & Procedure Manual, Section 380-70 Independent Consultants: UC Davis Manuals /Policy and Procedure Manual (PPM) / 380-70, Consultant Agreements