How to Hire Employees in Missouri: The Complete Compliance Sequence

The first Missouri employer I walked through a first hire had done everything visible right. Job posted, candidate chosen, offer signed, start date on the calendar. What he had not done was open the second state account. He had registered with the Department of Revenue for withholding, assumed that was the state registration, and found out during his first payroll run that unemployment insurance lives at a completely different agency.

Missouri is a moderate state to hire in. There is no state paid leave premium, no local minimum wage, and no statewide paid sick time mandate any more. What Missouri does have is a set of thresholds that decide which rules apply to you, a workers compensation rule that behaves differently for construction than for everything else, and two large cities that tax the paycheck and restrict the application form. None of it is hard. All of it is easy to miss.

I built FirstHR because this is the sequence a business without a dedicated HR person keeps dropping. The rules are learnable in an afternoon. The reminder is what never gets set. Below is the full Missouri sequence in the order the work actually happens, with the deadline and the exposure attached to each step, checked against the agency or the statute that governs it.

The Missouri Hiring Sequence at a Glance

Every item below is a legal obligation with a named enforcing body and a stated consequence. Four of them land before you have a candidate in hand, three at offer and start, and the rest inside the first month of employment.

The rest of this guide walks each step in the same order, calling out where Missouri departs from the generic advice in a national guide to hiring your first employee. The wider picture, covering leave, termination, and recordkeeping after the hire, sits in the Missouri compliance hub.

Step 1: Get Your Federal Employer Identification Number

Start with the federal Employer Identification Number, because both Missouri registrations ask for it on the identification screen. The EIN is how the IRS identifies your business on employment tax returns and deposits. Apply through the IRS online application and the number is issued at the end of the session.

If you formed an LLC or a corporation and already hold an EIN, reuse it. If you have been operating as a sole proprietor and filing under your Social Security number, you need one now. Payroll tax deposits cannot be made against a personal Social Security number, and neither Missouri account will open without an EIN.

Finish this before touching anything else. Founders who try to run the state registrations in parallel with the EIN application usually restart one of them. The EIN is also the number a workers compensation carrier will want on the application and the number that appears on every new hire report you file, so getting it first removes a dependency from three later steps at once.

Step 2: Open Your Missouri Employer Withholding Account

Missouri has a state income tax, so the second step is registering with the Missouri Department of Revenue for employer withholding. You can register through the online business registration portal or on Form 2643, the Missouri Tax Registration Application. The account number you receive identifies you on every Missouri withholding return, and the department assigns the frequency on which you remit what you withhold from wages.

Do this before the first payroll, not after it. Withholding is a trust obligation: the money belongs to the state from the moment it leaves the paycheck, and late remittance carries penalty and interest even when the underlying calculation was correct. The department publishes the filing frequency rules in its employer tax guide, and quarter-monthly filers are required to file electronically. The full Missouri tax picture sits in the Missouri payroll guide.

Two details save trouble later. Keep the Missouri withholding account number with the federal EIN, because Missouri filings ask for both and the two numbers look nothing alike. And write down the remittance frequency the department assigns you rather than guessing it, since that single field decides whether a correct calculation turns into a late payment penalty.

Step 3: Open Your Unemployment Insurance Account

Unemployment insurance is a separate registration at a separate agency. You register with the Division of Employment Security inside the Department of Labor and Industrial Relations, through the state business registration portal, through UInteract, or on the Unemployment Tax Registration form. The employer account number you receive is used on every quarterly contribution and wage report.

Liability is defined rather than assumed. A general business employer becomes liable once it pays $1,500 in wages, cash and in kind, in a calendar quarter, or has a worker for some portion of a day in each of 20 different weeks in a calendar year. Liability also attaches through federal unemployment tax coverage or by succession to an already liable Missouri employer. Once liable, an employing unit is asked to notify the division within 30 days.

New employers do not choose their unemployment contribution rate. The division assigns a beginning rate of 2.376 percent for 2026, the same figure for construction and every other industry class, with 1.0 percent for a 501(c)(3) nonprofit, and recalculates it once your own claims history matures, after which experienced employer rates range from zero to six percent before surcharges. What is fixed for the year is the base the rate applies to: Missouri charges contributions on the first $9,000 paid to each employee in 2026, down from $9,500.

Step 4: Decide Your Workers Compensation Position

Missouri ties workers compensation insurance to a headcount rather than to the first employee. An employer must carry coverage once it has five or more employees, and an employer in the construction industry must carry coverage with one or more employees. The construction rule does not care whether the worker is part-time, casual, full-time, or a family member. Employer guidance is published by the Division of Workers Compensation.

Who counts is where employers get this wrong. Members of an LLC and officers of a corporation count toward the employee total. Sole proprietors and members of a partnership do not count, and they are not covered themselves unless they elect coverage with their insurer. That means a two-owner LLC that hires three people has crossed the threshold, even though only three of the five draw a normal paycheck.

Coverage below the threshold is elective, and electing it is usually the right call. An employer that does not have the required number of employees, or that has employees in an exempt category, may elect to come under the law and carry a policy anyway. The reason is arithmetic rather than legal: without coverage, a single work injury is paid from the operating account, and the medical side of a serious injury can exceed a year of premium.

Price the coverage before you finalize the wage. Premium is driven by payroll and by the classification code that describes the work, so a warehouse role and a desk role at the same salary do not cost the same to insure. Getting a quote during the offer stage keeps the total cost of the hire honest, and it prevents the familiar situation where a business crosses the threshold with a fourth or fifth hire and nobody notices for a quarter.

Step 5: Fix the Application and Set the Offer

Missouri sets no statewide restriction on criminal history questions, but Kansas City and St. Louis both do, and the practical answer for most employers is a single compliant application form used everywhere. Kansas City prohibits an employer with six or more employees from inquiring into criminal history until after the applicant has been determined qualified and interviewed. St. Louis applies its ordinance to employers with ten or more employees in the city and bars the inquiry until the applicant has been determined otherwise qualified and interviewed.

Both cities go further than the phrase ban the box suggests. Each requires that an adverse decision rest on a reasoned link between the record and the duties of the job rather than on the existence of a record, and St. Louis separately bars job advertisements and application statements that exclude applicants with a criminal history. A lawful background check later in the process is unaffected.

Kansas City adds a pay history rule. An employer with six or more employees may not ask about an applicant salary history, screen applicants on it, rely on it in setting compensation, or retaliate against an applicant who declines to provide it. The ordinance carves out internal transfers and promotions, positions where pay is set by collective bargaining, and rehires within five years where the employer already holds the record. The general checklist of what a job posting must contain applies on top of the city-specific list.

The offer itself carries one Missouri number and one Missouri decision. The number is the wage floor: $15.00 per hour statewide, with a tipped employee entitled to at least half that as a direct wage plus whatever brings total compensation up to the full rate, per the Division of Labor Standards. The decision is the payday, which has to satisfy the state pay frequency rule before you write it into the letter.

Step 6: Complete Form I-9 by the Third Business Day

Every employer in the United States must complete Form I-9 for every new hire to verify identity and authorization to work. Missouri adds nothing to the federal requirement for an ordinary private employer, but the deadline is tight enough that this is the most commonly missed step in the sequence.

The employee completes Section 1 no later than the first day of work. You complete Section 2 within three business days of the start date by examining original documents the employee chooses to present. You cannot tell the employee which documents to bring. Specifying documents is its own violation, separate from any deadline problem.

E-Verify is a separate federal system that checks a completed I-9 against government records. Missouri requires enrollment as a condition of state and political subdivision contracts and grants above $5,000, and for a business entity receiving a state administered or subsidized tax credit, tax abatement, or loan. Enrolling never replaces the I-9 itself, and a business with no state contract and no state incentive is not required to enroll at all.

This step deserves a calendar entry rather than a mental note because of how the penalties are structured. Federal civil money penalties for I-9 violations are assessed per form and per employee rather than per audit, and paperwork errors are cited even when every worker turns out to be authorized. A remote hire adds a wrinkle: someone has to examine the documents, in person or through an authorized alternative procedure, and deciding who that is on day three is too late.

Step 7: Collect the Withholding Forms Before the First Paycheck

Missouri has a state income tax, so a new hire completes two withholding forms rather than one. Federal Form W-4 sets federal withholding. Form MO W-4 sets Missouri withholding and is the form the Department of Revenue expects to see on file for each employee, and it is where an employee claims an exemption or asks for additional withholding.

If the employee will perform work inside Kansas City or St. Louis, a third layer arrives at the same moment. Both cities levy a one percent earnings tax on wages earned within the city, and the employer withholds it and files a quarterly return. That is your registration rather than an employee form, but it belongs in this step because the trigger is the same fact: where the person physically works.

Collect the forms before day one rather than on day one. Everything on the list below except the employer half of the I-9 can be completed digitally in advance, which turns the first morning into an introduction to the work instead of an hour of paperwork. That sequencing is the entire point of structured new hire paperwork.

Step 8: File the New Hire Report Within Twenty Days

Missouri gives you 20 calendar days from the date of hire. The data lands in the State Directory of New Hires, which the Family Support Division inside the Department of Social Services maintains, and you can file it online through the division employer portal or, under section 285.300, by sending a copy of the employee Form W-4 to the Department of Revenue, which forwards the information to the division. An employer that reports electronically has a second option: two transmissions per month, not less than 12 nor more than 16 days apart.

Each report carries the employee name, address, Social Security number, and first day of work, plus your business name, address, and federal EIN. Because Missouri accepts the employee copy of the W-4 as the filing, this step is genuinely a five-minute task if you do it while the withholding forms are still in front of you. The federal basis for the requirement is the welfare reform act of 1996, and the data feeds child support enforcement and benefit integrity checks.

The penalty is small and the exposure is not really financial. Under section 285.302, an employer that intentionally fails to submit information on an employee is guilty of an infraction, fined not more than $25 for each failure, rising to $350 for each failure where the employer and the employee conspired to withhold the report or to file a false or incomplete one. What actually costs money is the pattern: an employer with no reporting process usually has no I-9 process either, and the two failures tend to be discovered in the same review.

Step 9: Post the Notices and Onboard Through Day 90

Two things happen at the start date. The required notices go up, and the actual onboarding begins. The notices are largely a one-time setup task. The onboarding is where the money you just spent on hiring either returns or evaporates.

Missouri employers display both state and federal notices where employees can see them. The Department of Labor and Industrial Relations publishes the state set free, which includes the Missouri minimum wage notice, the workers compensation notice, the notice to workers concerning unemployment benefits, the discrimination in employment notice from the Missouri Commission on Human Rights, the notice on leave for victims of domestic and sexual violence, and the list an employer must post when it employs workers under the age of 16. Federal notices cover the FLSA, OSHA, the Employee Polygraph Protection Act, and USERRA. There is no reason to buy any of them from a vendor.

Youth employment carries its own paperwork in Missouri. Workers under 14 may not be employed outside agriculture, entertainment, and casual jobs, and a 14 or 15 year old generally needs a work certificate issued through the school before starting. If any part of your workforce is that young, treat the certificate as a hiring gate rather than a formality, because the Division of Labor Standards enforces the child labor law alongside the federal standard and the stricter of the two governs.

I built the AI onboarding wizard in FirstHR for exactly this stretch. The offer letter goes out with e-signature. The I-9, W-4, and MO W-4 are collected digitally before day one. The system holds the reminders for the three-business-day I-9 deadline and the 20-day new hire report, and the wizard turns the job description into a 30-60-90 day plan instead of leaving the first quarter unplanned.

Missouri Rules That Change How You Employ People

Six Missouri rules reshape the employment relationship once the hire is complete. Each differs enough from the generic national picture that copying a handbook or a pay calendar from another state produces a compliance gap on arrival.

The pay cycle deserves emphasis because it is the rule employers most often break by assumption. Section 290.080 requires all corporations doing business in Missouri to pay wages as often as semimonthly, within 16 days of the close of each payroll period, and to furnish a statement of total deductions at least once a month. Executive, administrative and professional staff, and employees paid wholly or partly on commission, may be paid monthly at the option of the employer. Violating the frequency or the statement rule is a misdemeanor fined between $50 and $500 per offense.

Separation runs in the opposite direction from the states that use the next payday as the default. Under section 290.110, the wages of a discharged employee are due on the day of discharge. If the employee makes a written request for payment and the money or a valid check does not arrive within seven days, the wages continue to accrue at the same rate as a penalty, for as long as 60 days. Work out the final paycheck math before the separation meeting rather than after it.

Employment in Missouri is at will, subject to the usual statutory and public policy limits, which means neither party needs a reason to end the relationship. That default is easier to lose than to keep. Handbook language promising progressive discipline, a probationary period that graduates into permanent status, or a closed list of the only reasons for termination can all be read as a contractual limit on at-will employment, which is why the handbook is worth drafting carefully rather than assembling from templates.

One point of confusion worth clearing up: Missouri is not a right-to-work state. The legislature passed a right-to-work law in 2017, opponents forced it to a referendum, and voters rejected it by roughly a two-to-one margin in August 2018, so the law never took effect. Nothing about that changes what a small non-union employer does day to day, but it does mean advice written for a right-to-work state does not transfer cleanly, and it belongs in the same review as the employee handbook.

The state leave obligation most employers overlook covers victims of domestic and sexual violence. An employer at or above the statutory size threshold must provide unpaid leave and reasonable safety accommodations to an employee who is a victim, or whose family or household member is, and every covered employer must give employees notice of those rights when employment begins. The required workplace notice is part of the state poster set, so the posting half of the duty is handled the moment you print the posters.

City Requirements: Kansas City and St. Louis

Two Missouri cities add real obligations, and neither of them is a minimum wage. Section 290.528 preempts local minimum wage and benefit ordinances, so the wage floor is the same everywhere in the state. What Kansas City and St. Louis do instead is tax the paycheck and regulate the application form.

Both cities levy a one percent earnings tax on wages earned inside the city, and the employer withholds and remits it. In Kansas City an employer registers through the city tax portal and files a quarterly withholding return with the Revenue Division. In St. Louis an employer establishes an account with the Earnings Tax Department and files quarterly withholding for residents and for non-residents who work in the city. St. Louis adds a second employer tax that has no Kansas City equivalent: a payroll expense tax of one half of one percent of gross compensation paid to employees performing work in the city.

The address is the whole question, and it catches remote arrangements in particular. The earnings tax follows the place the work is physically performed, not the address on your business license, so a fully remote hire living inside Kansas City creates a Kansas City withholding obligation for a company headquartered anywhere. The same logic runs the other way: a St. Louis County office is not a St. Louis city address, and paying the city tax by mistake is its own cleanup.

The screening ordinances are simpler to handle than the taxes, because the safe answer is to build one application form to the stricter standard and use it statewide. There is no penalty for asking about criminal history later than an ordinance requires, and maintaining two versions of a form is how the wrong one ends up attached to a job posting. Enforcement in St. Louis escalates from a warning to a civil penalty to business license exposure, which makes the form worth getting right once.

Employee or Independent Contractor: Missouri Asks Who Controls the Work

Missouri decides classification on the right to control. The Division of Employment Security applies the twenty-factor test the IRS developed, and it treats the factors as evidence rather than as a scorecard: anyone who performs a service for wages is an employee if the employer can control what will be done and how it will be done. The division publishes the test for unemployment insurance purposes, and the same facts usually decide the workers compensation question too.

Two consequences follow a reclassification, and employers usually anticipate only one. The unemployment side brings back contributions with interest and penalties for the whole period. On top of that, section 285.515 lets a court award the state fifty dollars per day per misclassified worker, up to fifty thousand dollars, where the employer knew the worker was an employee, and section 285.503 gives the attorney general investigative and subpoena powers over suspected violations.

The guidance is not complicated. Run the analysis before anyone is paid on a 1099, write the answer down, and keep it with the contract. A written agreement calling someone a contractor proves nothing on its own, and neither does the worker preference for 1099 treatment, because the division looks at the substance of the relationship rather than the label. Hiring someone as an employee rather than a contractor costs you employer payroll taxes, unemployment contributions, and workers compensation premium. Getting the classification wrong costs years of back liability across two agencies.

The Mistakes That Cost Missouri Small Businesses the Most

These are the failures that repeat at Missouri businesses making a first or second hire. Each is a sequencing error rather than a knowledge gap. The employer knew the rule and ran the steps in the wrong order, or carried a habit across a state line.

The common thread is that compliance fails on the calendar, not in the reasoning. Nobody sets out to cross the workers compensation threshold uninsured or to file a new hire report on day 24. The task simply arrives during a stretch when the founder is doing four other jobs. That is why reminders and task workflows do more good at this scale than another compliance summary would, and it is the argument for keeping the whole sequence in one system rather than in one head.

Frequently Asked Questions