‘Tis the Season…
You probably do not think of HR compliance when you hear the phrase. But the end of 2025 is a good time — even in the midst of the holiday season — to look back at what has occurred, what still needs to be done in 2025, and to look ahead to 2026.
Here are some issues to consider as we ring in the new year:
- Evaluate “close call” classifications to determine whether employees are properly classified as “exempt” or “non-exempt.” Ask whether the duties of a particular position morphed over the year such that an employee no longer meets the “duties test.” Also confirm that the salary thresholds for exempt employees are being satisfied.
- Do you have a full inventory and understanding of where remote employees are working and whether there are any state law requirements specific to employees working remotely? Are you required to pay workers compensation or unemployment compensation for these remote employees?
- Have required reports such as EEO-1 forms and AAP plans been completed and submitted?
- Do you use AI in the hiring process? If so, are you subject to any laws governing AI specific to your jurisdiction?
- Do you have a good working knowledge of employment laws that were enacted in your jurisdiction in 2025 and have or will soon go into effect? Have you put policies and systems in place to ensure compliance?
- Are you ready for new laws that will take effect in your jurisdiction in 2026? Some states will be more active than others. For example, as we’ve reported, Minnesota has a new paid leave law going into effect on January 1, 2026, and Colorado’s Family and Medical Leave Insurance (FAMLI) law will now cover worker’s children’s NICU (neonatal intensive care unit) stays. In addition to new leave laws, states have enacted new laws with topics ranging from collective bargaining for gig workers, expansion of pay equity statutes requiring disclosure of wage information (a/k/a “pay transparency”), expanded pay data reporting, the right to recover payment for training if employees leave before a certain time, restrictions or expansions of enforcement of covenants not to compete, restrictions on non-disclosure and non-disparagement provisions in separation agreements, and requirements for information to be posted and available to employees. (This is a non-exhaustive list.) Check your state and municipality for recently enacted laws or laws soon to become effective.
- Verify the minimum wage in your state for 2026 and budget for any increases.
- Audit the eligibility of employees to work in the United States. In other words, how effective is your I-9 compliance? Confirm whether you are subject to any E-verify requirements. For instance, the Florida legislature is considering HB 197, which, if enacted, would require all private employers (regardless of size) to use E-verify.
- If a reduction-in-force is forecast, think about whether any state or federal WARN Act reporting thresholds apply and will be met. Allow sufficient time to give the required notice before implementing the RIF.
- Consider conducting a compensation study to determine pay equity and market suitability for employees and positions.
- Ensure compliance with privacy laws, ranging from data privacy, electronic monitoring of employees, notifications for data breach, consent for use of image in company websites and communications, etc.
The above list is not designed to dampen the holiday season. It is a gentle reminder that employers must always be aware of the current and prospective laws that govern employers and employees. Each state and municipality will differ, as will obligations even among industries or type of employer.
But all employers have an obligation to ensure compliance with the ever-changing legal and regulatory framework in which they operate.
And, with that, enjoy the holidays!
