Tool to determine the best way to engage a collaborator

Answer the following questions to determine the most likely mechanism for your collaboration. Use the Mechanism Guidance table below for additional information.

Mechanism Guidance

  Employee Consultant/Independent Contractor Subaward Vendor
Description An individual with an established employment relationship with Duke, paid by Corporate Payroll Services.  Note, it is difficult to suggest that the employment relationship ceases to exist, even upon termination. An entity who provides goods or services needed to carry out the project or program under an externally funded award. A contractor relationship is established via a legal document outlining terms of the procurement relationship.  Generally does not serve as senior personnel, e.g., Co-Investigator, Principal Investigator An award provided by a pass-through entity (e.g., Duke to a subrecipient (e.g., UNC) for the subrecipient to carry out part of a sponsored project received by the pass-through entity. It does not include payments to a contractor or an individual that is a beneficiary of a Federal program. A subaward may be provided through any form of legal agreement, including an agreement that the pass-through entity considers a contract. The entity’s personnel are designated senior/key personnel in the proposal; may be a Co-PI, Co-Investigator, or other key personnel An individual or entity that supplies products or services to Duke University ancillary to the operation of the sponsored project. Specific individuals providing goods and services may not be identified in the proposal or contract
Use when…. ...the individual is: 1. A current, active Duke employee 2. A former Duke Employee doing an extension of previous work when an active Duke employee 3. Performing similar work under similar direction / control as a Duke employee   ...Duke is engaging an individual who will provide limited, temporary, or highly specialized expertise for a set fee.   ... Duke is engaging another institution or organization to perform a substantive, intellectually-significant portion of programmatic effort on the award.  ... Duke is engaging with an external entity that supplies goods or products, based on a set fee schedule, as part of its typical business practice. 
Guidance See Duke GAP 200.129 Special Rules for Engaging and Paying Current and Former Employees as Independent Contractors for additional guidance. See Duke GAP 200.134 All Other Payments to Individuals for Services for additional guidance.    
Defining characteristic Individuals should not receive both a W-2 and a 1099 form in the same tax year for services provided to Duke University/Duke University Health System.   An collaborator whose expertise is required to perform University project; Services are temporary and special or highly technical.  An external entity has agreed to work in collaboration with the Duke PI to perform a substantive portion of the programmatic effort on a sponsored project at their facilities, using their own personnel.  The entity is responsible for programmatic decision-making, including decisions related to the design, reporting, and conduct of research. An individual or entity that supplies products or services to Duke University ancillary to the operation of the sponsored project
Important considerations The situations where it may be more appropriate to treat a current or past employee as an independent contractor are rare and must be well-documented. Even past employment can taint the status of the individual for subsequent services provided to Duke.  To establish an independent contractor relationship additional documentation is required; In addition to IRS purposes, Fair Labor Standards Act and Worker’s Compensation are reasons to consistently treat an individual as employee.  Sponsor compliance regulations are not incorporated into agreement; May provide similar services to other organizations Has responsibility to meet all applicable sponsored requirements; Project work is complex, and requires 1) a scope of work, 2) budget, 3) billing requirements, and a 4) deliverable schedule (reports, etc.) in the proposal; May need animal and/or human subjects approvals for its independent portion of the work; Typically is reimbursed for costs similar to those in Duke’s proposal budget, e.g. effort, fringe, supplies, travel; F&A recovery Duke specifies the goods or services it requires in support of the project; Sponsor compliance regulations are not incorporated into agreement; Goods and services provided by the contractor/vendor are ancillary to the program; Description of the services is limited to the work performed by this company or individual
Allowable/typical responsibilities   May provide recommendations but is not responsible for designing, developing, reporting results or progress, or the outcome of the overall project; Consultant (not Duke) determines how to accomplish the service Can make administrative and programmatic decisions and control the method and results of the work; Has responsibility for a portion of the end results of the overall project. May provide similar goods or services to different organizations as part of their normal business operations; May compete with comparable entities to provide the same goods/services
Unallowable/atypical responsibilities   Does not develop the objectives of the project or scope of work   Does not make programmatic decisions or take actions that impact a program’s overall success; Is not responsible for results of the overall project
Resourcing May use university resources, space, tools, supplies Does not use university resources; Provides their own expertise, work area, tools, materials and supplies; Payment is fee-based (not salary) and based upon completion of specific work, rather than time worked (although hourly payment may be specified) Uses funds to carry out a program rather than provide a good or service Goods and services are billed according to the vendor’s established rates
Outputs   Usually “work for hire”; intellectual property, if any, belongs to University; Not considered a co-author The entity’s work results may involve intellectual property and/or may lead to publications; Has performance measured against meeting the project objectives; The entity’s SOW may represent an intellectually significant portion of the programmatic decision making Typically no potential for patentable or copyrightable technology to be created through project from activities of the entity or individual;  Will not be considered a co-author
Budget as… Employee with Salary, Fringe Benefits; Applicable F&A is assessed to full amount budgeted  Independent Contractor / Consultant based on verifiable rate or fee Applicable F&A is assessed to full amount budgeted Subaward / Consortium based on all costs associated with the collaborating institution’s scope of work (including the collaborating institution’s F&A costs based verified F&A rate agreement or 10% de minimus rate, if applicable); All costs must be verifiable in accordance with Uniform Guidance § 200.331 Requirements for Pass-Through Entities and Part 9905 – Cost Accounting Standards for Educational Institutions; Applicable F&A is assessed to first $25,000 of each competing segment of each subaward Goods or services based on verifiable set fee or rate; Applicable F&A is assessed to full amount budgeted based on the goods or services provided