Hiring Options is a series to outline some of the different options you have for growing your team. I'll cover W2 Employees, Freelance/Independent Contractors, and Interns.
I will include things to consider before deciding what kind of employment relationship you want and where to find people once you’ve decided.
What does W2 mean?
This is the traditional employer/employee relationship. When you make the leap to employer, you’re taking on a variety of responsibilities including a lot of paperwork. One of those is supplying a W4 to new employees. That is the employer side of the W2 employees get for taxes at the end of each year.
Becoming the Employer of Record is not something that should be taken on lightly. It involves a tremendous amount of paperwork and configuration.
Just a few of the obligations of the employer of record are Unemployment Insurance, Worker’s Compensation, State and Federal Tax Withholding, administering any benefits programs, and potential liability if your employee causes harm to someone else.
Depending on what the position is you may be able to hire someone as a 1099 (Independent Contractor) which limits the paperwork and set up for you tremendously. W2 is the route most traditional businesses need to take. It is also the most easily understood and accepted by candidates. Plus, once you’re set up – it gets a lot easier!
What do you think? Did I forget anything else about having W2 employees?
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