Subrecipient vs. Consultant Guidance
Subrecipients are collaborating institutions that participate in sponsored projects awarded to another institution known as a Pass-through Entity. The working relationship between the Pass-through Entity and subrecipient is established through a formal agreement. A Subrecipient completes work that influences a project programmatically for a significant portion of the work while a contractor, also known as a supplier in ConnectCarolina, only supplies goods and services to the project on an hourly, daily, or fixed fee schedule.
It is important to decide if the outside entity being paid from the project is a subrecipient or a contractor. This determination allows the Office of Sponsored Programs (OSP) to ensure the appropriate agreements are in place. At time of award, if the subrecipient v. contractor determination was proposed incorrectly, the direct cost budget will need to have an updated budget to address the insufficient indirect costs which will then decrease direct costs. For more information, see OSP Operating Standard 500.11 – Outgoing Subrecipient Agreements 
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Subrecipient Qualifications
Subrecipients have substantive, programmatic participation in a sponsored project. This is most easily identified by their involvement in designing, directing, and conducting the research as proposed. The subrecipient identifies a Principal Investigator/Project Director to manage the project at their institution who may be considered key personnel by the sponsor as part of UNC’s total project. The subrecipient is given flexibility to conduct their portion of the research and can make independent decisions regarding their portion of the project.
Contractor Qualifications
Contractors are independent entities or individuals unaffiliated with UNC, hired to provide specific services or ancillary goods necessary for UNC to complete the proposed research project. Contractors are not directly involved with the scientific direction of the project, and they normally provide the same goods or services in a consistent manner for all their business customers, and they are responsible to the sponsor for the research results. Contract terms and conditions typically do not apply to a contractor.
Compensation for a contractor is based on their rate history for comparable work with other entities. Compensation can be expressed as a daily rate or a fixed amount for the services provided.
Subrecipient v. Contractor Determination
For purposes of subrecipient determination, the term vendor/supplier can be used interchangeably. For assistance in determining if an entity is a subrecipient or contractor, review the table below and/or the supplemental questionnaire (PDF).
Subrecipients
- Their performance is measured against meeting the objectives of the program
- They have authority for administrative and programmatic decisions
- They provide on-going research or collaboration for the life of the program
- They carry out a programmatic aspect of the project, unlike a contractor who only provides a standard service
- They are responsible for applicable program compliance requirements, i.e. IRB, IACUC, or Cost Share
- Publications may be created or co-authored at the entity
Contractor/Supplier
- They provide a service as part of their normal bus operations
- They provide a similar service to many different purchasers
- They operate in a competitive environment (compete with others who can provide a similar service)
- Their program compliance requirements do not pertain to the service provided
- Contractors are suppliers
Independent/individual contractors with a primary appointment at other Institutions of Higher Education (IHE) must provide a signed certification letter from their IHE Authorized Representative, which acknowledges there is not a conflict of commitment and whether the IHE’s resources will be used. Please reference a sample IHE certification letter (PDF).For more information see OSP Operating Standard 500.12 – Consultants .