OSP | FAQ | Subcontractors vs. Consultants

Questions?

  • Office of Sponsored Programs
    202-885-3440
    osp@american.edu
    Wisconsin (4200) Suite 300

    Nichols, Michael L
    Director of Office of Sponsored Programs

Mailing Address

Subcontractors vs. Consultants (Vendors) - How to Tell Them Apart

 

Characteristics of a Subcontractor

Subcontractor - According to OMB Circular A-110: Legal entity to which a subaward is made and which is accountable to the recipient for the use of the funds provided.
  • Synonymous with subawardee, subgrantee, etc.
  • Subcontractor's goods or services are specifically tailored in response to the project, not provided commercially
  • Subcontractor's program/project director is generally a collaborator; may even be designated as a Co-Investigator in the proposal
  • Subcontractor is part of the development and execution of the work performed by prime/grantee
  • Makes programmatic decisions
  • Has performance measured against the goals/objectives of the project

 

Characteristics of a Consultant (Vendor)

Consultant - Categorized as a vendor-type relationship. An individual or company retained to provide professional advice or services on a project for a fee.
  • Provides the goods or services within normal business operations
  • Provides similar goods or services to many different purchasers
  • Operates in a competitive environment
  • Are subject to open-bid requirements or requires sole source documentation
  • Provides goods or services that are ancillary to the operation of the research project; and
  • Are generally not subject to monitoring or reporting requirements of the prime award
  • A company or an individual who is clearly a bona fide consultant (expert advisor) who pursues this line of business for him/herself
  • Are paid for their time at a daily or hourly fixed rate
  • A consultant is considered a "work for hire" thus all intellectual property and copyrightable information is generally assigned to the prime/grantee recipient (i.e. American University)

 

Why is it important to distinguish between a Subcontractor and a Consultant (Vendor)?

  • Allowability of subcontractor generally requires prior approval of the sponsor
  • Inclusion of a subcontractor effects the calculation of F&A costs
  • Federal subrecipient monitoring requirements are applicable to subcontractors/subawardees

 

 

For questions regarding how to distinguish between a subcontractor and consultant (vendor), please contact the Office of Sponsored Programs.