This procedure provides information regarding Internal Revenue Service, State of Georgia, and Georgia Tech regulations.
Payment to Employees for Personal Services
According to Common Law Rule:
"Every individual who performs services subject to the will and control of employer, both as to what shall be done and how it shall be done, is an employee for purposes of all federal payroll taxes. It does not matter that employer permits employee considerable discretion and freedom of action, so long as employer has legal right to control both method and result of the services."
Refer to the Accounts Payable Procedure Consulting - Attachment C to review the 20 factors developed by the Internal Revenue Service to aid in determining whether there is an employer-employee relationship. Students receiving Fellowships that require them to perform services should be aware that this income may be taxable.
To ensure compliance with the Fair Labor Standards Act, regulations of the Internal Revenue Service, and laws of the State of Georgia, Georgia Tech will purchase services from employees only through the payroll system. This arrangement precludes any type of contractual agreements with any University employee for payment of services other than through established payroll procedures.
Payment for personal services will be made on regularly scheduled pay dates only. State regulations prohibit advance payments.
The standard workweek for non-administrative classified employees at Georgia Tech is 40 hours, from 12:01 a.m. Thursday through 12:00 midnight on Wednesday. If it is necessary for an employee's workweek to exceed 40 hours, the overtime must be pre-approved by the department head.
Payment for Overtime
Any non-exempt classified employee of Georgia Tech (as defined by the Fair Labor Standards Act) who is required to work more than 40 hours during a workweek will be paid at one and one-half times his/her standard rate for all work in excess of 40 hours, unless compensatory time is authorized. If an employee is paid on more than one account and the combined hour for the workweek exceed 40, the total pay will be prorated to each account based on the percentage of time reported per account to total time reported each workweek.
The Board of Regents Personnel Policies Handbook, Section II--Classified Employment states:
"In lieu of payment for approved overtime work, compensatory time may be granted at the rate of one and one-half hour of compensatory time for each hour of overtime work. Approved compensatory time is subject to a maximum accumulation of sixty (60) hours and must be expended by the end of the succeeding calendar quarter."
Participation in research projects (Human Subjects)
Payments under $75 per participant will be considered de minimis and not reported on a W2, 1042S nor 1099 Misc. Participants must pass the Selection of Human Subjects criteria:
- Full or part time employee of the Institute,
- Full or part time undergraduate student,
- Full or part time graduate student, provided the graduate student’s funding department agrees that the student may participate in the research.
- Students who are on financial aid assistance,
- Non-Institute affiliated individuals.