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Hiring your first employee is exciting. The paperwork that comes with it is not. There’s the W-4, the I-9, state tax forms, direct deposit setup, and a dozen fields where one typo means a tax filing problem six months from now. This guide walks you through adding an employee correctly — so payday goes smoothly and tax season doesn’t become a nightmare.

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Before you start

You need paperwork from the employee. Don’t skip this part:
FormWhat it’s forWhere to get it
W-4Federal tax withholding electionsEmployee fills out (available from IRS)
State W-4State tax withholding (if your state has income tax)Employee fills out
I-9Proves they’re authorized to work in the USYou and employee complete together
Direct deposit formBank account details for paymentEmployee provides
You can collect these on paper or have the employee complete them digitally through Pluvel’s self-service onboarding (more on that below).

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Add the employee

1

Go to Payroll

Click Payroll in the sidebar, then Employees.
2

Click Add Employee

Hit the Add Employee button.
3

Enter their information

The basics:
  • Full legal name — Exactly as it appears on their Social Security card. “Mike” on their SS card? Enter “Mike,” not “Michael.”
  • Email address — Where pay stubs and tax forms will be sent
  • Date of birth — Required for tax filing
  • Social Security Number — Required (no exceptions)
  • Home address — Affects state tax calculations
Double-check the SSN. One wrong digit causes IRS matching failures. It’s the most common payroll setup mistake.
4

Set employment details

  • Start date — Their first day of work
  • Job title — For your records
  • Department — Optional, helps with reporting
  • Work location — Where they primarily work (this determines which state taxes apply)
5

Set up compensation

Pay type:
  • Salary — Fixed amount regardless of hours (you enter annual amount)
  • Hourly — Rate per hour (you enter hourly rate)
Pay schedule:
  • Weekly (52 pay periods/year)
  • Bi-weekly (26 pay periods/year)
  • Semi-monthly (24 pay periods/year — 1st and 15th)
  • Monthly (12 pay periods/year)
Bi-weekly is most common. Semi-monthly is easier for salaried employees. Monthly is uncommon and some states restrict it.
6

Enter tax withholding

This comes from their W-4:
  • Filing status — Single, Married Filing Jointly, Head of Household
  • Multiple jobs checkbox — If they have other jobs
  • Dependents — For additional withholding credits
  • Extra withholding — Any additional amount they requested
For states with income tax, enter the state W-4 info too. Each state’s form is slightly different.
7

Set up direct deposit

Most employees want direct deposit:
  • Bank name
  • Routing number (9 digits)
  • Account number
  • Account type — Checking or Savings
Employees can split deposits across multiple accounts (e.g., 80% to checking, 20% to savings). Add more accounts if needed.
8

Add deductions (optional)

If they have recurring deductions:
  • Health insurance premiums
  • 401(k) contributions (percentage or flat amount)
  • HSA contributions
  • Other pre-tax or post-tax deductions
These get subtracted automatically each payroll.
9

Save

Click Save. The employee is ready for payroll.

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Let employees onboard themselves

Instead of entering everything manually:
  1. Add the employee’s name and email
  2. Click Send Invite
  3. They receive an email with a link
  4. They complete:
    • Personal information
    • W-4 (with digital signature)
    • State tax forms
    • Direct deposit setup
This saves you data entry and puts the responsibility on the right person. They know their SSN and bank account — you’re just asking for typos if you’re the one entering it.

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Make sure your company is set up

Before you can actually run payroll, verify your company setup in Settings → Payroll:
RequirementWhy it matters
EIN (Federal Tax ID)Required for all federal tax filings
State tax IDsRequired for each state where employees work
Payroll bank accountThe account we debit for payroll
Workers’ compRequired by most states — fines for non-compliance
If any of these are missing, you’ll get a warning before you can run payroll.

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Employee vs. contractor

Quick gut check: is this person actually an employee? Employee (W-2):
  • You control how, when, and where they work
  • They use your equipment and tools
  • You provide training
  • They work only (or mostly) for you
Contractor (1099):
  • They control how the work gets done
  • They use their own tools
  • They have other clients
  • They could profit or lose money on the engagement
Misclassifying employees as contractors triggers IRS penalties, back taxes, and state labor law violations. When in doubt, they’re probably an employee. Add a contractor instead →

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Updating employee information

Things change — addresses, bank accounts, tax elections:
  1. Go to Payroll → Employees
  2. Click on the employee
  3. Edit the relevant section
  4. Save
Changes to tax withholding take effect on the next payroll. Changes to bank accounts typically need one pay period to verify.

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When someone leaves

When an employee’s time ends:
  1. Open their employee record
  2. Click Actions → Terminate
  3. Enter:
    • Last day of work
    • Termination reason (for your records)
    • Whether they get a final paycheck
  4. Run the final payroll if applicable
The employee record gets archived — you can still access it for tax forms and records, but they won’t appear on future payrolls.
Some states have strict final paycheck timing requirements (California: same day if fired, 72 hours if quit). Know your state’s rules.

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Frequently asked questions

New hires who’ve applied for an SSN but haven’t received it can use their ITIN temporarily. But they need an SSN eventually for proper tax reporting. Don’t let this linger.
Pluvel doesn’t handle background checks. If you want one, use a third-party service before adding them to payroll. It’s separate from the payroll process.
Yes. If you invite them to Pluvel, they can:
  • View all pay stubs
  • Download W-2s at tax time
  • Update their address and direct deposit
  • Adjust W-4 withholdings
They can’t see other employees’ information or company-level data.
Set up benefit deductions in the employee’s profile (step 8 above). The amount gets deducted each paycheck automatically.For actual benefits administration (enrolling in plans, managing carriers), you’ll need a separate benefits provider or integration.
Their work location determines which state taxes apply. You’ll need:
  • State tax ID for their state (if you don’t already have one)
  • Compliance with their state’s labor laws
  • State unemployment insurance registration
Pluvel handles the multi-state tax calculations once you’re registered.

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What’s next

Run payroll

Process your first payroll.

Set up direct deposit

Configure how and when employees get paid.