HR Compliance Checklist and Guide for 2024

In 2020, PNC Bank was ordered to pay $2.75 million to three former customer service reps to settle an overtime pay dispute. The plaintiffs claimed PNC Bank neither tracked nor recorded their hours worked; they also reported they could only clock in once they’d booted their computers and read their emails, totaling three unpaid hours per week per employee. 

Organizations can avoid lawsuits entirely if they prioritize HR compliance. Although the landscape can feel like a minefield of laws and regulations to keep up with, this guide explores what you need to know to ensure compliance during benefits administration.

What should be on your HR compliance checklist?

Break down the HR compliance checklists of laws and regulations into the following categories to stay on top of your obligations: 

Recruitment compliance 

The following laws and regulations kick in during your hiring procedures, before you’ve even recruited someone to join your team:

• Title VII of the Civil Rights Act of 1964 prohibits employment discrimination based on race, color, religion, and national origin. It also includes sex discrimination based on pregnancy, sexual orientation, and gender identity. 
• The Americans with Disabilities Act (ADA) protects individuals with disabilities in all areas of public life, including work.
• The Age Discrimination in Employment Act (ADEA) is enforced by the Equal Employment Opportunity Commission and protects certain employees aged 40+ from age discrimination in hiring. 

The above laws and regulations prevent interviewers from asking inappropriate questions during an interview, such as “Do you plan to start a family soon?” or “How old are you?” 

Some states have introduced pay transparency legislation to combat wage discrimination. These laws generally prohibit employers from asking about salary history during the interview process, with states like California requiring employers to disclose salary ranges in their job postings. 

Anti-discrimination compliance 

Once hired, the laws above protect employees from discrimination throughout the entire employee lifecycle. For example, Title VII of the Civil Rights Act, ADA, and ADEA ensure that workers are safe from harassment while interacting with coworkers, managers, and leadership. These laws also require employers to provide reasonable accommodations for employees with disabilities in all aspects of employment, such as job duties and working conditions.

Additionally, the Equal Pay Act requires employers to pay men and women equally for equal work. This means employees should receive the same pay for performing substantially similar job duties, regardless of gender. Employers should be aware of state-level anti-discrimination laws, which may provide additional protection and requirements.

Employees must always know how to report any issues or concerns related to discrimination and harassment in the workplace. Employers should have clear policies and procedures for handling these situations and regular training sessions to educate employees on their rights and responsibilities.

Salary compliance 

Whether hourly, annual, or contract-based, all employees have a right to be paid fairly and on time for their work. Employers must comply with federal and state minimum wage laws for salaries and bonuses, as well as any applicable overtime pay requirements.

The Fair Labor Standards Act (FLSA) sets the federal minimum wage and overtime pay requirements, while states may have their own laws with higher minimum wages or additional overtime requirements. Employers must also know about special provisions for certain employees, such as tipped workers and minors.

Employers should keep accurate records of all hours worked by their employees, including breaks and meal periods, to remain compliant.

Payroll and tax compliance 

Payroll professionals’ work aligns closely with legal compliance. They must meet the following responsibilities as defined by the Internal Revenue Service: 

• Verifying employee records, including details such as name and address, to ensure accurate tax calculations and proper reporting
• Confirming who has left the company to update their employment status accordingly 
• Calculating and deducting the correct amounts for Social Security, Medicare, FUTA taxes, benefits, and other withholdings from employees’ paychecks
• Reporting payroll information to federal, state, and local authorities 
• Filing and issuing necessary reports such as W-2 forms for wages and taxes, W-4 withholding certificates, 941 forms for quarterly tax returns, and 1099s for miscellaneous information
• Ensuring timely payments of all payroll taxes

Employee benefits compliance 

Employers must provide their employees with certain mandatory benefits, such as health coverage. These are set out in the following regulations:

• Affordable Care Act: Requires employers to provide affordable health insurance options to their employees.
• Consolidated Omnibus Budget Reconciliation Act: Ensures continuation of healthcare coverage for employees and their dependents when they lose their jobs or experience other life-changing events.
• Employee Retirement Income Security Act: Sets minimum standards for retirement, health, and other welfare benefit plans to protect employees’ rights. 
• Family Medical Leave Act: Requires certain employers to provide unpaid job-protected leave for specific family and medical reasons.
• Health Insurance Portability and Accountability Act: Protects employees’ privacy by regulating the use and disclosure of their personal health information.

Of course, many companies also like to entice job seekers and reward employees with a generous mix of non-mandatory benefits, such as wellness stipends, professional development benefits, and parental leave. Employers must administer these perks and benefits fairly and consistently to prevent discrimination or unfair treatment. They must also understand how to tax them properly, according to IRS guidelines. 

Documentation and privacy compliance 

Employers must keep detailed records of their employees and comply with certain regulations when handling sensitive employee data. These determine how you store certain information, how long you keep it, and who has access to it. Some key regulations include: 

• Fair Credit Reporting Act: Regulates the use and reporting of consumer credit information, including employment background checks.
• State-level regulations, such as the California Consumer Privacy Act, give California residents the right to know what personal information companies are collecting about them and how it is used. 
• Personal Information Protection and Electronic Documents Act: Requires companies to obtain consent before collecting, using, or disclosing personal information in the course of commercial activities. Although this is a Canadian law, it is relevant to U.S. companies that conduct cross-border data transfers. 
• General Data Protection Regulation: Applies to companies processing personal data of individuals in the European Union. Employers must comply with strict rules for collecting, storing, and handling employee information.

Safety compliance 

Employees have a right to attend a workplace that is safe from hazards and accidents. Employers can comply with relevant safety regulations according to the Occupational Safety and Health Act (OSHA), which: 

• Requires employers to maintain records of workplace injuries, illnesses, and fatalities.
• Ensure employees have access to information about potential hazards in the workplace and receive proper training on how to address them.
• Establishes a hierarchy of control measures employers must follow to protect workers from harm. 

How to manage your compliance responsibilities

The number of acts, regulations, and forms you’re supposed to know inside out can be incredibly overwhelming if you’re an HR professional rather than a lawyer. Stay on top of your obligations by following the below best practices: 

Know what’s required 

Visit important resources to ensure HR compliance. Remember: You don’t need to know the history of a particular law or the past versions of it. Instead, you must: 

• Familiarize yourself with the current legislation that applies to your company and employees.
• Keep an eye on changes in compliance laws. You can stay up to date by regularly checking government websites or subscribing to alerts from trusted sources.
• Identify areas where you may be at risk and take action to address them. It can be helpful to conduct regular audits of your HR practices and policies to identify areas for improvement.

Keep a human resources compliance checklist of important resources handy, such as: 

• Society for Human Resources
• Internal Revenue Service
• Department of Labor  
• Occupational Safety and Health Administration
• Equal Employment Opportunity Commission 
• National Labor Relations Act 
• State-level government websites for labor and employment laws 

Plug key compliance dates in your calendar

Fill up your HR calendar with:  

• W-2 and 1099 form dates: Annual deadlines for distributing these forms to employees and contractors and for filing with the IRS
• Quarterly tax filings: Deadlines for Form 941 (Employer’s Quarterly Federal Tax Return) for reporting payroll taxes
• Unemployment tax filings: Annual or quarterly deadlines for state unemployment tax filings
• Open enrollment periods for employee benefits and health insurance 
• ACA compliance dates: Deadlines for reporting health coverage information to employees and the IRS
• Retirement plan contribution dates: Deadlines for employee 401(k) plans and other retirement accounts
• Deadlines for conducting performance reviews or providing annual notices to employees about their rights under certain laws (e.g., FMLA, HIPAA)
• Expiration dates for licenses or professional certifications required for certain roles

Update your employee handbook

Your employees must understand your company’s policies and procedures, which should be outlined in an up-to-date employee handbook. Make sure it reflects any changes to compliance laws and regulations and any updates to internal policies. Here are some tips for creating a practical employee handbook: 

• Have a clear purpose: The handbook should guide employees and provide them with necessary information about their rights and responsibilities.
• Keep it simple: Use clear language and avoid jargon or legal terminology that employees may not understand.
• Review regularly: Update your handbook at least once a year, or more frequently if necessary, to remain compliant with current laws and regulations. 
• Distribute to all new hires: Ensure every employee receives a copy of the handbook and understands its contents. Have them sign an acknowledgment form to confirm they have received and read the handbook.

Depend on compliance-friendly software 

Manual HR compliance can be complex and difficult to manage. The alternative? The right HR software keeps you organized and ensures your policies and practices align with current laws and regulations. Look for software that offers features such as: 

• Compliance tracking: A centralized platform to track important deadlines, employee information, and compliance training.
• Document management: A secure and organized storage system for important documents, such as employee handbooks and management training materials.
• Automated compliance reminders: Set notifications for upcoming deadlines and tasks related to HR compliance.

Remember: Any digital compliance feature is only as good as the way you’ve set it up and the people using it. Provide user training and conduct regular audits to ensure your software remains effective in helping you stay compliant. 

Offer compliant benefits administration with Benepass 

Employee benefits are laden with compliance requirements—from reporting taxable income to keeping employees updated about their packages, there’s plenty to stay on top of.   

Benepass offers a centralized benefits administration platform with built-in compliance features to beat the red tape by: 

• Delivering compliant pre-tax benefits admin, including comprehensive plan documentation
• Conducting nondiscrimination assessments and filing Form 5500s
• Providing template-based educational materials for employees
• Offering access to a dedicated Employee Experience Team to assist your HR professionals
• Setting up integrations with your payroll and HR information systems, enabling automated reporting of imputed income for taxable benefits

Ready to prioritize HR compliance in your organization? Book a free Benepass demo today or contact sales@getbenepass.com to connect with a benefits specialist.