Why We Pay as W2 Employees
It is very important for us and our clients to correctly classify their talent workforce. Talent paid through the AllWork platform are paid as W-2 employees. We must withhold income taxes, withhold and pay Social Security and Medicare taxes, and pay unemployment tax on wages paid to an employee.
Why They are Classified as W2 on AllWork
When classifying talent, we've taken the following three IRS classification points into consideration:
Does your business have the right to control how the work is done and what type of work is completed, such as through direct instructions or training? If you train the worker, direct what they do, and specify how the work is completed, he or she is a W-2 employee.
Type of Payment
Employees are usually paid salary or an hourly wage. Independent contractors typically receive a flat fee per project.
Type of Relationship
If the person is receiving benefits, there is an understanding this is a permanent role, and they help the regular operation of the business, this person is an employee.