📝 Overview
Each worker's Employee Profile contains a Contracts card where worker classification (employee or contractor) and employment details are stored. A worker's contract can be updated when their classification changes between a 1099 contractor and a W-2 employee.
📋 Add a New Contract
⛔️Important Note: A new contract can only be added after an active contract has been ended. See the Ending a Contract section below before proceeding.
Click the arrow to see how to add a new contract
Click the arrow to see how to add a new contract
Navigate to the Worker List and select the worker.
Select the Profile tab.
Locate the Contracts card and select Edit.
Select Add a new contract in the upper right corner.
Fill in the following details:
Effective date: The start date of the new contract. Note: the effective date cannot match the end date of the previous contract.
Worker classification: Employee or contractor.
Overtime eligible: Applicable to employees only.
Select Save.
⚙️ Overtime Eligibility
Overtime eligibility is required for all employees before payroll can be processed. Whether overtime pay is required depends on your work state's labor laws.
Click the arrow to see how to set overtime eligibility
Click the arrow to see how to set overtime eligibility
Navigate to the Worker List and select the worker.
Select the Profile tab.
Locate the Contracts card and select Edit.
Under Overtime eligible, select Yes or No.
Select Save.
🔧 Ending a Contract
You must end a worker's active contract before adding a new one. The end date should reflect the last date payroll was processed for the worker under their current classification.
Click the arrow to see how to end a contract
Click the arrow to see how to end a contract
Navigate to the Worker List and select the worker.
Select the Profile tab.
Locate the Contracts card and select Edit.
Expand the active contract and select Edit.
Add an End date: the last date payroll is processed for this worker as an employee or contractor.
Select Save.
❓ Frequently Asked Questions (FAQs)
Find answers to common questions or additional details that may not be covered in the main instructions.
Click the arrow to view frequently asked questions
Click the arrow to view frequently asked questions
Can a contract be backdated?
Click the arrow to see the answer
Click the arrow to see the answer
Yes. Both the effective date and end date can be adjusted to reflect the worker's actual employment period. This is useful if a contract was not created at the time of hire or classification change.
Can I update a worker's classification without ending their contract?
Click the arrow to see the answer
Click the arrow to see the answer
No. To change a worker's classification from employee to contractor (or vice versa), you must first end the active contract and then add a new contract with the updated classification. The new contract's effective date must be the day after the previous contract's end date.
What happens if a contract is ended in error?
Click the arrow to see the answer
Click the arrow to see the answer
An end date cannot be removed once saved. To correct this, add a new contract with an effective date set to the day after the previous contract's end date. No issues or delays will occur as long as the same classification is selected.
Can a worker receive both a 1099 and a W-2?
Click the arrow to see the answer
Click the arrow to see the answer
Yes. If a worker was paid as both a contractor and an employee during the same calendar year, they will receive both tax forms at year end.