Change employment type—employee to contractor, contractor to employee

Teammates with multiple Gusto accounts can easily switch between their profiles, so long as the same personal email is associated with all profiles.

If you're paying someone as an employee and a contractor during the same calendar year, at the end of the year, they'll need both a Form W-2 (for employee payments) and Form 1099 (for contractor payments). Make sure you've recorded their payments in Gusto in the appropriate profile types.

Change someone from an employee to a contractor

1. Dismiss the employee profile in Gusto.
   • They'll be removed from future payroll in Gusto, and;
   • After their dismissal date, they'll be considered inactive—you're only charged for months an employee was active (even if partially).
     • Heads up: Because we bill in arrears (for the month prior), you'll typically still see an employee-charge on the invoice that comes immediately after someone is dismissed.  
2. Add the person as a contractor. 
   • You're only charged the monthly per-contractor price ($6, or $12 based on plan type) in the months you pay the contractor. 

Change someone from a contractor to an employee

1. Dismiss the contractor profile.
2. Hire the person as an employee.
   • This adds them to your employee payroll (separate from your contractor payments).
   • If you get an error stating “the SSN already exists”, check to see if there's already another employee profile with the same SSN as the person you're trying to add.