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WSDOT and Consultant Co-Location

A WSDOT/ACEC committee and several co-located WSDOT offices developed and reviewed the guidance below.

Things to Think About Before Co-Locating

Discuss and/or decide upon this list of items (pdf, 42 kb) when co-locating WSDOT and a consultant firm.

The list is not a “must do” or a “how to.” Rather, it is a list of things to consider. It is intended for use by WSDOT and consultant firms anticipating a co-location of any sort. All items may or may not be applicable to all types of co-location.

Consider the Dynamics of the Consultant Office

A big factor to consider is the dynamics of the consultant office:

  • Are WSDOT staff moving in with them into an existing office?
  • Will consultant staff be housed in a WSDOT office, or will a new location be established for this project?
  • If a new location is established, will WSDOT acquire the space or will the consultant?
  • If the consultant acquires the space, will the consultant be performing non-project related work in this office?

Answering the above questions will help determine if WSDOT should provide office equipment, supplies, etc. and how reimbursement should be handled for project-related expenses.

Benefits and Risks of Co-Location

While the primary benefits of co-location are to establish a closer working relationship, and to share expertise, WSDOT and consultant staff should be aware that there is a necessary dividing line. There can be monetary consequences if the IRS determines that consultants are treated too much like employees.

Also, in at least one case, the courts determined that independent consultants working long-term, on location, were actually more like employees of the organization, and were entitled to all benefits of that organization (Vizcaino vs. Microsoft Corp. 1999). However, there are many factors that play into determining whether a person is consultant or employee. The IRS uses the 20-Factor Test. Meeting one or even a few of these factors does not mean that the line is crossed, however, the more that are met, the higher the risk. 

One of the factors on the IRS test is "tools" - meaning tools and equipment. This is only one factor in the grand scheme of things, but can be an obvious example.

The typical contractor would provide their own equipment for the job. In a co-location situation, there will probably be shared copiers and fax machines, but what about personal computers, blackberries, etc.? If contractors provide WSDOT staff with equipment as well, it helps show we aren't treating them specifically like employees. 

Learn from Others

When working on issues involved with co-location it might be beneficial to discuss this issue with your Human Resources staff.

It is highly recommended that those anticipating a co-location set up a session with another office that is already co-located, for the purpose of hearing “lessons learned”.

Contact Consultant Services at 360-705-7104 to find out who has recently co-located.