RSUs are allowed, by law, to be granted to employees and non-employees alike. This means they can be used for contractors and outside directors.

From an individual income and tax perspective they are also similar to RSUs given to employees.  The income generated at the time of vest is Ordinary Income and is subject to associated taxation.  Unlike RSUs given to employees, the company is not required to (and in fact should not) withhold taxes.

This means the reporting of income and payment of taxes is the responsibility of the individual.  At the end of he year the company will provide an 1099-misc, but your tax burden may need to be satisfied prior to that.

From a company perspective the accounting consequences are quite different when granting to non-employees.  RSUs, when give to employee and settled in stock, are generally accounted for as equity and have a fixed compensation expense that is amortized relative to the vesting schedule. For non-employees this expense must be accounted for using FIN 28 (even though this doesn’t technically exist anymore) methodology.  This means that each reporting period (assume quarterly) you will need to adjust the expense associated with the RSUs.  If the stock price at the company grows this can result in the company take a far greater expense for a non-employee RSU that was granted at the same time as an employee RSU.

All of that being said…Plan documents can be written to expressly forbid granting any type of of equity to non-employees. If the plan doesn’t allow it, then it doesn’t matter if the law does.