| Paying Independent Contractors |
| Payficiency's payroll system allows you to pay W-2 employees and Independent Contractor on the same account at the same time! There are three common options for paying Contractors. |
| >Flat Rate |
| >Variable Rate |
| >Hourly Rate |
| Flat Rate |
| Set the Pay Type to "Contract" on the Pay Info tab under Employees and Contractors. Set the Pay Rate to a flat dollar amount that is paid every pay period, similar to salary for a regular employee. When running payroll, the contractor is paid the flat amount automatically. You do not need to enter hours. If the contractor should not be paid during a period, you must enter 0 in the earnings code "Pay Override". Use this method when the contractor is paid the same amount almost every pay period. |
| Variable Rate |
| Set the Pay Type to "Contract" on the Pay Info tab under Employees and Contractors. Set the Pay Rate to 0.00. When running payroll, use earnings code "1099 Payments" and enter the amount in dollars to pay the contractor that pay period. If no amount is entered, nothing is paid. There is no risk of paying a contractor inadvertently. Use this method when the contractor is paid a different amount each pay period. |
| Hourly Rate |
| Set the Pay Type to "Contract" on the Pay Info tab under Employees and Contractors. Set the Pay Rate to the hourly rate and use "Regular Hours" and "Overtime Hours" to pay, similar to regular hourly employees. If nothing is owed, you must enter 0 in the earnings code "Pay Override". Otherwise, the system treats the amount set in Pay Rate as a Flat Rate amount. Use this method to pay by entering hours, but you must remember to override any contractor not being paid. |
