Individual Contract Policy

Supplemental Guidance:

 

203. 
     Insurance coverage provided to individual contractors covers service-incurred liabilities only. It is not intended to provide coverage for long-term needs and pre-existing needs or conditions, but rather only for needs during the time the individual is engaged by UNDP. All other insurance requirements (e.g., pension, life, medical/health, travel, etc.) must be purchased by the individual at his/her own expense.
     

Malicious acts insurance policy

204. 
     Individual contractors who provide services in, or travel at UNDP’s expense to, a designated hazardous duty station are covered by the Malicious Acts Insurance Policy. Accordingly, the contractor must comply with all UN security directives. Failure to comply shall be grounds for termination of the contract for cause and possible loss of insurance eligibility and benefits. The business unit issuing a contract shall be required to ensure that the contractor is aware of all security directives, including issuance of security clearance for travel.
     

Breach, Termination and Dispute Settlement

Breach of an individual contract

205. 
     Individual contractors are liable for breach of the obligations they assumed under an individual contract. If the contractor’s supervisor believes there has been a failure to perform or breach of contract, such as through unsatisfactory performance or failure to complete an assignment in accordance with the terms of reference, the supervisor must allow the individual contractor a reasonable opportunity to solve the issue within a specified time. If this does not occur, consistent with Section 8.2, above, the supervisor must notify the Deputy Country Director Operations, the Deputy Resident Representative Operations, the Operations Manager in a country office or the Procurement Services Unit as well as the Legal Support Office so that a decision can be made about whether or not to withhold payment of any amounts that may be due to the individual contractor, suspend or terminate the contract and/or remove the individual contractor from any applicable rosters.
     
206. 
     The business unit must fully document the alleged breach, the steps taken to allow the individual contractor to remedy it and any other relevant action taken by the business unit and the contractor.
     

Termination of an individual contract

207. 
     According to the General Conditions of Contract for the Services of an Individual Contractor, an individual contract may be terminated by either party with advance written notice. The period of notice is five days for contracts of less than two months and 14 days for those of a longer period. A notice of termination does not need to state the reasons for termination, nor does it have to be signed by the party to which it is addressed.
     
208. 
     Although Section 13 permits unilateral termination without any express reason, to avoid claims and disputes, it is advisable that a contract be terminated by mutual agreement of the parties. Since the contract would end by consent, the termination can take effect immediately. The business unit and the individual contractor should formalize termination in a short written statement, acknowledging termination by agreement and the amount of compensation due, if any. The statement should be signed by both parties. The Procurement Support Office and the Legal Support Office should be consulted if any issues or questions arise.
     
209. 
     In some cases, the business unit may have strong reasons to terminate a contract unilaterally, in response to failure to perform or breach of the contractual obligations by the individual contractor. In such cases, consistent with Sections 8.2 and 10.1, above, the matter must be brought to the attention of the Procurement Services Unit and the Legal Support Office for guidance on next steps.
     
210. 
     For any termination, the business unit is only liable on a pro rata basis for actual work done to its satisfaction. If the contractor terminates the contract, the business unit may withhold from compensation any additional costs incurred by it as a result.
     

Settlement of disputes

211. 
     If the business unit and an individual contractor disagree over any aspect of a contract, every effort should be made to resolve that disagreement amicably, i.e., through informal discussions, consultations and negotiations. Business units are strongly encouraged to seek early guidance from the Legal Support Office on handling disputes. 
     
212. 
     If an amicable settlement is unsuccessful, the matter must be escalated to the Procurement Support Office and the Legal Support Office for advice and further guidance. Arbitration may be initiated under the United Nations Commission on International Trade Law Arbitration Rules. The arbitral tribunal will be constituted to hear the parties’ positions and issue a binding decision.
     
213. 
     The initiation of arbitration proceedings should not be considered the cause for or the actual termination of an individual contract. Except with respect to any indemnification obligations of the individual contractor, or as otherwise set forth in the contract, any arbitral proceedings must commence within three years after the cause of the action. Arbitration is a means of last resort, as it requires a substantial commitment of time and resources from both sides. Amicable settlement is thus strongly encouraged for the benefit of both the UNDP business unit and the individual contractor.
     
214. 
     If the UNDP business unit receives a notice of arbitration from an individual contractor, the matter must be immediately referred to the Procurement Support Office and the Legal Support Office for advice.
     

Roles and Responsibilities

Roles	Responsibilities
Head of business unit	Institute a process for determining whether or not an individual contract is the most appropriate instrument for the required services and ensuring that contracts are only used for their specific purposes.
Head of business unit	Coordinate with other UN agencies in establishing the fee structure for contracting individuals.
Managers of requesting units	Determine whether or not, based on a review and analysis of all possible contract modalities vis-à-vis the nature of the assignment, an individual contract is the most appropriate contract modality.
Managers of requesting units	Determine the purpose and duration of the contract in accordance with the Individual Contract Policy and ensure availability of funds and budget proper amounts corresponding to the duration of the agreement and any foreseen extensions.
Managers of requesting units	Prepare the terms of reference with clearly defined deliverables, deadlines and qualification requirements.
Procurement units	Facilitate the selection process for individual contractors, provide guidance to the requesting units and evaluation team in completing the assessment and the selection process in line with the policy.
Procurement units	Ensure that all candidates shortlisted for a desk review and/or interview are of comparable qualifications that meet the terms of reference requirements, have confirmed availability and have submitted financial proposals specific to the assignment.
Managers of requesting units	Participate in the selection of the most suitable candidate for the assignment.
Procurement units	Submit sufficient documentation and obtain committee or bureau director approvals of individual contracts where necessary and applicable.
Contract Review Committees	Recommend approval of individual contracts based on the threshold established in this policy.
Head of business units	Exercise delegation of authority on the award of individual contracts within the limits of their authority.
Procurement units	Ensure that each individual contract signed by UNDP includes all necessary information, particularly the insurance beneficiary of the individual contractor.
Procurement units	Establish individual contractors as vendors in Atlas and issue contracts and purchase order in Atlas corresponding to the payment of fees as per contract terms
Procurement units	Ensure that each individual contract signed by UNDP includes all necessary information, particularly the insurance beneficiary of the individual contractor.
Procurement /Operations/Requesting Units	Facilitate contract administration tasks such as travel arrangements, medical clearance and visas, as appropriate.
Managers of requesting units	Monitor the performance of the consultant, establish and authorize contract amendments if required.
Procurement units	Implement any contract amendment that may be requested and authorized by the requisitioner.
Managers of requesting units	Certify completion of milestone outputs/deliverables, and authorize disbursement of corresponding payments.
Finance Units	Make payments to individual contractors against a fully completed and duly authorized Certification of Payment Form.
Managers of requesting units	Complete performance evaluation upon conclusion of assignment.
Procurement units	Maintain appropriate documentation and records of the process for audit purposes.
Procurement units	Maintain and update a roster of qualified, pre-screened subscribers and well-performed ICs (together with other UN agencies as appropriate)
Procurement Services Unit	Provide the policy and instruments to administer, oversee and monitor the correct and appropriate use of the individual contract modality.
Procurement Services Unit	Provide policy clarifications and interpretation where needed.
Legal Support Office	Respond to legal questions involving interpretation and/or application of terms and conditions of an individual contract.
Legal Support Office	Provide guidance on suspension or termination, especially when the individual contractor’s breach is the grounds for such termination.
Legal Support Office	Offer legal advice regarding contract disputes between UNDP and an individual contractor, especially when such are not resolved amicably and manage arbitration proceedings, if any.
Office of Audit and Investigations	Audit the use of individual contracts by users with delegated authority and report on its findings.

1^ To illustrate this, if Staff A is on leave, Staff B must be designated as the temporary substitute for the duties of Staff A. An IC may be engaged to support Staff B in the performance of his/her temporarily expanded functions/duties, except for those that are solely intended to be performed only by “staff” as per UNDP policies. Any function associated with a temporarily vacated post, due to any form of absence or leave, must still be formally delegated only to another staff member, to ensure that the IC engaged to support a staff is not performing core staff functions. For delineation of core staff functions and segregation of duties, see the Internal Control Framework.

2^ This condition must be distinguished from the situation described in correct use (d). Here, an IC is directly replacing a staff on leave, which is prohibited, because it creates expectation of performing duties that only staff should perform.

3^ Derived based on 21.75 working days per month x 24 months = 521 working days in a year

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Page of Effective Date: 02/09/2015 Version #: 11