The Pay Classification Matrix was created to assist campus units with correctly classifying individuals working for or providing services to the Institute. Individuals performing these tasks are generally classified as an Employee, Independent Contractor or Honorarium payment. The impacts of misclassifying payments to these individuals are listed below.
- Individual - Incorrectly classifying as Independent Contractor or Honorarium, not Employee
- Individual’s wages may have qualified under the Federal Labor Standards Act (FLSA) for Overtime and Minimum Wage
- Social Security, Medicare, State and Federal taxes not withheld from the payment
- Individual not eligible for Worker’s Compensation
- Individual did not receive employee benefits such as holiday pay, health insurance, retirement, etc
- Individual - Incorrectly classifying as Employee, not Independent Contractor or Honorarium Payment
- Quarterly tax filings not completed and/or incorrect
- Tax filing required for income from Honorariums if $1,000 of taxes owed annually
- Institute
- Penalties and Interest for back taxes
- Federal, State, Social Security, Medicare and Unemployment
- Negative publicity and possible reputational damage
- Penalties and Interest for back taxes
Additional information and guidance regarding classifications of individuals can be found below.
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Procurement and Business Services |
Employee or Independent Contractor http://www.procurement.gatech.edu/purchasing/empl-contractor |
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HR Form Bank |
Independent Contractor Checklist http://ohr.gatech.edu/georgia-tech-human-resources-forms |
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GT Policy Library |
Employee Contractor Policy (5.3.3) http://www.policylibrary.gatech.edu/consultants-individuals-and-firms |
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GT Policy Library
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Payments to International Vendors and Non-Resident Alien Consultants, Scholars and Official Visitors (5.3.5) |
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AP Accounting Help Desk |
Non US Citizens or Permanent Legal Residents |
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Tax Compliance Manager |
Charles Grattan charles.grattan@business.gatech.edu 404-385-4396 |