What is a temporary employee and what are the company's payroll related obligations?
Temporary employees are generally temporary workers supplied under a contract with a temporary employment agency. Since these workers are considered employees of the employment agency, all income tax withholding and payroll tax obligations (payments and reporting) are the responsibility of the employment agency. However, should the temporary employment agency cease operations without remitting their employees' payroll tax obligations, the responsibility for unpaid employment taxes is the responsibility of the company for whom the temporary workers provided services.