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Onboard a Contractor-Only Company

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Users can create contractor-only companies without W-2 employees. This company type has fewer onboarding requirements compared to those with W-2 employees. However, contractor-only companies have a payroll blocker that prevents them from processing payroll for W-2 employees.

We also enable updating a contractor-only company to a company that supports payments for contractors and payroll for W-2 employees. Note that after updating, the company must complete additional onboarding steps before they can run payroll for W-2 employees.

Contractor-Only APIs

🚧

We have not explicitly blocked APIs for contractor-only companies, but some behaviors that should be avoided. For instance, users can technically create an employee for a contractor-only company through the API. However, they should refrain from doing so since the company is contractor-only.

Although we are not explicitly blocking API endpoints, fully onboarded contractor-only companies are unable to run payroll due to the contractor-only payroll blocker. This applies even when the company has onboarded contractors.

1. Create a contractor-only company

To create a contractor-only company, specify “contractor_only”: true within the body params of the POST /v1/partner_managed_companies endpoint. The default case, if not specified, is “contractor_only”: false (i.e. the company has at least one W-2 employee).

curl --request POST \
     --url https://api.gusto-demo.com/v1/partner_managed_companies \
     --header 'accept: application/json' \
     --header 'content-type: application/json'\
     --header 'Authorization: Bearer {{system_access_token}}'\
      --data '{
       "user": {
            "last_name": "Mushnik",
            "first_name": "Mister",
            "email": "[email protected]"
       },
       "company": {
            "name": "Mushnik`s Flower Shop",
            "ein": 910532465,
            "contractor_only": true
       }
			}'

const fetch = require('node-fetch');

const url = 'https://api.gusto-demo.com/v1/partner_managed_companies';
const options = {
  method: 'POST',
  headers: {
    accept: 'application/json', 
    'content-type': 'application/json',
    authorization: 'Bearer <<API_TOKEN>>'
  }
  },
  body: JSON.stringify({
    user: {
      first_name: 'Mister',
      last_name: 'Mushnik',
      email: '[email protected]'
    },
    company: {
      name: "Mushnik\'s Flower Shop",
      ein: "910532465"
  }
                       
  })
};

fetch(url, options)
  .then(res => res.json())
  .then(json => console.log(json))
  .catch(err => console.error('error:' + err));

2. Get a company’s contractor_only attribute

Make a call to the GET /v1/companies endpoint to identify if a company is contractor-only. In the response, the “contractor_only” attribute is used to determine whether or not the company is contractor-only. It will be true for a contractor-only company.

{
    "contractor_only": true
}

3. Get a company’s onboarding requirements

You can retrieve the company’s onboarding requirements using the using the GET companies/{company_uuid}/onboarding_status endpoint. The onboarding steps returned will be different for a contractor-only and non contractor-only company.

For a contractor-only company, the onboarding steps include add_addresses, federal_tax_setup, select_industry, add_bank_info, add_contractors, sign_all_forms, and verify_bank_info.

The state_setup, payroll_schedule, and add_employees steps are not included for contractor-only.

{
    "uuid": "8e75cd53-9427-40a1-9f7c-4542d56d7e6e",
    "onboarding_completed": false,
    "onboarding_steps": [
        {
            "title": "Add Your Company’s Addresses",
            "id": "add_addresses",
            "required": true,
            "completed": true,
            "skippable": false,
            "requirements": []
        },
        {
            "title": "Enter Your Federal Tax Information",
            "id": "federal_tax_setup",
            "required": true,
            "completed": true,
            "skippable": false,
            "requirements": []
        },
        {
            "title": "Select Industry",
            "id": "select_industry",
            "required": true,
            "completed": true,
            "skippable": false,
            "requirements": []
        },
        {
            "title": "Add Your Bank Account",
            "id": "add_bank_info",
            "required": true,
            "completed": true,
            "skippable": false,
            "requirements": []
        },
        {
            "title": "Add Your Contractors",
            "id": "add_contractors",
            "required": false,
            "completed": true,
            "skippable": false,
            "requirements": [
                "add_addresses"
            ]
        },
        {
            "title": "Sign Documents",
            "id": "sign_all_forms",
            "required": true,
            "completed": true,
            "skippable": false,
            "requirements": [
                "federal_tax_setup",
                "add_bank_info"
            ]
        },
        {
            "title": "Verify Your Bank Account",
            "id": "verify_bank_info",
            "required": true,
            "completed": true,
            "skippable": false,
            "requirements": [
                "add_bank_info"
            ]
        }
    ]
}

4. Get a company’s payroll blockers

Users can retrieve a company’s payroll blockers through the GET /v1/companies/{company_uuid}/payrolls/blockers endpoint. If a company is contractor-only, it will have the following payroll blocker:

[
    {
        "key": "contractor_only_company",
        "message": "Company is set to contractor_only and cannot run payroll. Update the company and complete additional onboarding steps to process payroll."
    }
]

This payroll blocker does not apply to companies with W-2 employees.

5. Update a Company to Support Payroll for W-2 Employees

If a contractor-only company wants to onboard and run payroll for W-2 employees, the company must first be updated using the PUT /v1/companies endpoint

The user should specify “contractor_only”: false in the body params.

curl --request PUT \
     --url https://api.gusto-demo.com/v1/companies/company_id \
     --header 'accept: application/json' \
     --header 'content-type: application/json' \
     --data '
{
  "contractor_only": false
}

const fetch = require('node-fetch');

const url = 'https://api.gusto-demo.com/v1/companies/{company_uuid}/signatories';
const options = {
  method: 'POST',
  headers: {
    accept: 'application/json',
    'content-type': 'application/json',
    authorization: 'Bearer <<COMPANY_API_TOKEN>>'
  },
  body: JSON.stringify({
    home_address: {
      street_1: '35 Fantine Street',
      street_2: 'Suite 17',
      city: 'Paris',
      state: 'TX',
      zip: '75460'
    },
    ssn: '254324601',
    first_name: 'Jean',
    last_name: 'Valjean',
    email: '[email protected]"',
    title: 'Business Man',
    phone: '8002331000',
    birthday: '1983-12-01'
  })
};

fetch(url, options)
  .then(res => res.json())
  .then(json => console.log(json))
  .catch(err => console.error('error:' + err));

📘

Updating the "contractor_only" attribute

Note that the contractor_only attribute can only be updated from true to false, and not vice versa. In other words, contractor_only cannot be enabled for an existing company. Also note that if you update "contractor_only": false you must also complete the state_setup, payroll_schedule, and add_employees onboarding steps before running payroll.

Contractor-Only Onboarding Flow

After creating a contractor-only company using the POST /v1/partner_managed_companies endpoint, generate a company_onboarding flow using our POST /v1/companies/{company_uuid}/flows endpoint. The flow will have different requirements depending on whether the company is contractor-only.

curl --request POST  
         --url <https://api.gusto-demo.com/v1/companies/{{company_uuid}}/flows>  
         --header 'Authorization: Bearer {{access_token}}’'  
         --header 'Content-Type: application/json'  
       --data '  
{  
         "flow_type": "company_onboarding"  
}

const fetch = require('node-fetch');

const url = 'https://api.gusto-demo.com/v1/companies/{company_uuid}/signatories';
const options = {
  method: 'POST',
  headers: {
    accept: 'application/json',
    'content-type': 'application/json',
    authorization: 'Bearer <<COMPANY_API_TOKEN>>'
  },
  body: JSON.stringify({
    home_address: {
      street_1: '35 Fantine Street',
      street_2: 'Suite 17',
      city: 'Paris',
      state: 'TX',
      zip: '75460'
    },
    ssn: '254324601',
    first_name: 'Jean',
    last_name: 'Valjean',
    email: '[email protected]"',
    title: 'Business Man',
    phone: '8002331000',
    birthday: '1983-12-01'
  })
};

fetch(url, options)
  .then(res => res.json())
  .then(json => console.log(json))
  .catch(err => console.error('error:' + err));

Non Contractor-Only Flow:

Contractor-Only Flow:

  • “Add Your Employees,” “Select a Pay Schedule,” and “Enter Your State Tax Information” are not included as steps in the contractor-only onboarding flow since these steps are not applicable.
  • The contractor-only onboarding flow includes the“Add Your Contractors” step that is not included in the default onboarding flow.
    • We have nested the add_contractors flow within the onboarding flow.

Updated about 2 months ago