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purchasing   /  Training Resources - Contracts

Contracts

When do I need a formal contract with a company/individual?
In determining whether a contract is required:

1) First, look at the amount of the fee (excluding travel). If the fee is $2,499 or less, no contract is required unless there are terms or conditions or signatures required (see item 3).

2) If the fee is $2,500 or more, determine if the service is professional, consulting, or non-professional.

  • Professional services are usually performed by an individual with an advanced degree (PhD, MD, architect, engineer, lawyer etc).
  • Consulting Services will include independent contractors or other individuals who possess a high degree of skill in their field.  If the fee is $2,500 or more for either professional services or consulting, a contract is required.  Note that no differentiation is made between whether payee is a company or individual.  The same rules apply.
  • Non-professional services are usually performed by individuals without an advanced degree and include lawn care specialists, janitorial services, window cleaning, etc.  If the fee is $7,500 or more, a contract is required.

3) If there are terms or conditions or a signature is required, a contract is always required.

Are contract templates available for me to use?
Yes.  You can find various contract templates here.

What is the difference between a contract and a fee for service agreement?
UAB's Procurement Office has recently changed the nomenclature for most formal agreements with external entities (company/individual) from contracts to fee for service agreements.  The words can be used interchangeably, but the contracts themselves are worded as fee for service agreements.

If the company/individual requires a cash down payment or deposit, do I need a contract?
Maybe.  If the total amount to be paid (including deposit) is above the appropriate contract threshold, a contract is required.  If not above the threshold, a contract would not be required UNLESS a signature is required or there are terms and conditions.

When do I need an Event Preapproval Form?
An Event Preapproval Form is required whenever UAB will be sponsoring an event whether or not any UAB funds will be spent or a non-UAB sponsored event when UAB funds will be spent.  It does not matter whether the event is occurring at UAB or at a remote location.  More information about event preapproval can be found here.

*An Event Preapproval Form is not required if the event is an official UAB event oriented towards students/trainees, endowment-funded lectureships, or ticket events.

If I have an approved Event Preapproval Form, do I also need a contract?
This depends on the situation.  If the event is sponsored by UAB and occurring at UAB, then a contract would not be required.  However, if the event is occurring at a location other than UAB, a contract might be required if it meets or exceeds the UAB contract thresholds amounts OR there is a formal agreement that requires a signature.

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