Employee Misclassification: What Happens When You Mistake an Employee for an Independent Contractor

Last week I wrote a piece on the difference between an independent contractor and an employee, which you can read here. However, what happens if you thought you had an independent contractor, but after a bit of research you come to find that the worker is an employee. Unfortunately, the IRS has become more strict on this issue in recent years after they discovered billions of dollars were being lost due to misclassification of workers. Not only are there IRS implications, you will also find yourself penalized by the Social Security Administration, and your state government.

Human Resources, BusinessMarketing TeamJanuary 5, 2017Employee Misclassification, Contractor, independent contractors, IRSComment

Job Classifications: Do I Have an Employee or a Contractor?

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.

Human Resources, BusinessMarketing TeamDecember 27, 2016Job Classification, independent contractors, employee, Job status, Employment LawComment

How to Determine if You Have an Employee or Independent Contractor

Determining employee classification is a vital part of running your business. It can be easy to confuse an employee for an independent contractor and vice versa, but doing so will cause you a lot of problems later on.

Paying Independent Contractors

Recently I wrote a blog about hiring independent contractors, so this time I would like to share information about paying them. It is important to remember that an independent contractor is a worker who does not work for your company, but is on a contract basis instead. Make sure you have correctly classified your worker before considering paying them as an independent contractor. As mentioned in the blog Hiring Independent Contractors, if your business is audited by the IRS and mistakes are found, you may be fined and subject to penalties.

Human ResourcesGuest UserApril 26, 2016Hiring, hr, independent contractorsComment