When you hire a new worker, it is important that you properly classify them as either an employee or independent contractor. If you misclassify a worker's status, this will have major implications for the Employer's taxes as well as the Workers'. If you classify a worker as an Employee, the Employer will be liable for payment of FICA, FUTA and State Unemployment taxes. In addition, the worker will be eligible to participate in any retirement or health benefit plans maintained by the Employer.