Before you can properly run payroll for your new hire you need a few key pieces of information; pay rate, pay frequency, cost center assignment, personnel information, and preferred method of payment are all obvious components of running payroll, but what about the classification of your relationship with the person performing work? Knowing whether or not you have an employee or a contractor is vital when paying the individual for their hours worked. If you have an employee that you have mistaken for an independent contractor you will need to audit your information and withhold the appropriate taxes from their wages. Not sure what the difference between a direct hire and a contractor is? Keep reading to learn the telltale signs.

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