Most HR professionals understand the importance of correctly classifying an independent contractor vs an employee, although it is important to make sure to keep the lines between independent contractor and employee clear. There are a number of items to keep on file for independent contractors but I would not suggest including an "independent contractor" file in with your employee files-- have a dedicated section for all independent contractors to be sorted together.
Here is a listing of recommended items for inclusion in an independent contractor file:
- W9 Form (Request for Taxpayer Identification Number and Certification - required if paying a contractor more than $600 over the course of a tax year)
- Contract/Agreement (outlining the payment, project, etc)
- Copies of invoices
- Emergency Contact information (in the case of an emergency event)
- Any Confidentiality disclosures (be sure that these are reflected for contractors and not just written for employees)
- Business Information on the Independent Contractor (projects completed, background information, etc)
Do not have the independent contractor complete an I9 form, employment application, enroll in benefit plans or be paid through the company's payroll. If the contractor requests any of these items, you may be dealing with a person who really isn't an independent contractor!
Need help determining whether someone should be classified as an employee or independent contractor? Trying to determine what steps to take for on-boarding an independent contractor? Contact the Advice & Resolution team!