Supplier

A corporation or individual who sells goods or a service is considered a supplier. Pepperdine prefers that requestors use a University Credit Card if they are purchasing products that amount to $5,000 or less. For goods or services that amount to more than $5,000, requestors should create a PeopleSoft Requisition.

To select a supplier, we encourage employees to find an existing supplier. If a supplier with your specific needs cannot be found, Purchasing can assist you in locating a supplier. If necessary, Request a New Supplier by submitting a Supplier Application. The Finance Office is required to keep a Supplier Application and completed W-9 on file for all suppliers conducting business with the University. Please note that suppliers with no activity for two years will be inactivated. A new W9 and Supplier Application are required to activate an inactive supplier.

NOTE: Payments made to out-of-state suppliers for services performed in California are subject to 7% state income tax withholding when payments exceed $1,500 in a calendar year. In addition, the supplier will be mailed a Form 592B at the end of the calendar year containing all reportable withholdings.

**ATTENTION: As of January 1, 2020, California Assembly Bill 5 (AB-5) has gone into effect. This statute places restrictions around the classification of independent contractors (IC) versus employees. An independent contractor is classified as an employee unless proven otherwise through the "ABC test" (all of which must be met in order to properly classify the worker as an IC). AB5 entitles workers classified as employees to greater labor protections, such as minimum wage laws, sick leave, and unemployment and workers' compensation benefits, which do not apply to independent contractors. Business to business is not applicable in this bill.

The law codifies and expands the scope through the "ABC test". This test is used to establish that a worker is an independent contractor for those purposes.

Supervisors will be responsible for reviewing the agreements prior to services rendered and ensuring that the supplier is an Independent Contractor. Please allow up to two weeks to process the Supplier. In some cases, Human Resources will need to review and approve the Supplier. Refer to the Execution of Documents for authorization levels to expend University Funds.

Please answer each question to the best of your knowledge to assist in the University's compliance

1. The individual is free from direction and control applicable both under the contract for the performance of service and in fact
   • the hiring entity does not control or direct the worker in performing the work in fact or under the terms of a contract. The individual has the ability to set or negotiate their own rates for the services performed and the individual has the ability to set the individual's own hours
2. The service is performed outside the usual course of business of the employer
   • the work performed is outside the usual course of the hiring entity's business. No other employee currently employed at Pepperdine can perform these services and are outside of the day to day business process
3. The individual is customarily engaged in an independently established trade, occupation, profession, or business of the same nature as that involved in the service perform

• • the individual maintains a business location, which may include the individual's residence, that is separate from the hiring entity and their services are offered to the public, outside of Pepperdine University

Last Updated: 02/05/2021