Preparing for Year-End: Legal and HR Requirements for Businesses

The year’s final quarter is a crucial time for businesses, bringing a range of legal and HR tasks that must be completed to ensure compliance, financial accuracy, and workforce satisfaction. From reviewing employee benefits to filing key documents, staying on top of year-end requirements is essential for avoiding penalties and starting the new year on the right foot. SolveHR, your trusted PEO partner, is here to help you streamline the process and meet all necessary deadlines.

Why Year-End Preparation Matters

Failing to adequately prepare for year-end can lead to compliance issues, financial discrepancies, and unhappy employees. By addressing key legal and HR requirements ahead of time, you can minimize disruptions and focus on strategic planning for the coming year.

Key Year-End Legal and HR Requirements

1. Review Employee Classifications and Compensation

• Why It’s Important: Misclassifying employees as exempt or non-exempt can lead to wage disputes and legal penalties. Year-end is the perfect time to review classifications and ensure compliance with the Fair Labor Standards Act (FLSA).
• SolveHR Tip: Conduct an employee classification audit and verify that salaries align with minimum wage and overtime requirements. SolveHR can assist in reviewing job roles and making necessary adjustments.

2. Ensure Payroll Compliance

• Why It’s Important: Accurate payroll records are essential for tax filings and compliance. Errors in overtime calculations, withholding, or benefits deductions can result in penalties.
• SolveHR Tip: Perform a year-end payroll audit to catch discrepancies. SolveHR can handle payroll reconciliation, ensuring all records are accurate and up-to-date.

3. Prepare and Distribute Employee Tax Forms

• Why It’s Important: Employers must prepare and distribute W-2 forms for employees and 1099 forms for independent contractors by the IRS deadlines. Late or inaccurate filings can result in penalties.
• SolveHR Tip: Begin organizing payroll records now to ensure timely and accurate tax form preparation. SolveHR offers comprehensive tax filing support to simplify this process.

4. Review Employee Benefits for Open Enrollment

• Why It’s Important: Open enrollment season typically falls at the end of the year, making it an ideal time to review your employee benefits offerings. Updating benefits to reflect employee needs and market trends can improve retention and satisfaction.
• SolveHR Tip: Use data from the past year to evaluate which benefits are most utilized and where gaps exist. SolveHR can help you design a competitive benefits package for 2026.

5. Address Compliance Updates

• Why It’s Important: Employment laws change regularly at federal, state, and local levels. Businesses must ensure policies are updated to reflect new regulations.
• SolveHR Tip: Stay informed about changes such as minimum wage increases, paid leave laws, and workplace safety updates. SolveHR provides ongoing compliance support to keep your business up to date.

6. Conduct Employee Performance Reviews

• Why It’s Important: Performance reviews help assess employee progress, set goals for the coming year, and identify opportunities for training or promotion.
• SolveHR Tip: Implement a structured review process to provide meaningful feedback. SolveHR can help you develop review templates and strategies for fostering employee growth.

Year-End HR Best Practices

1. Communicate Clearly with Employees
   • Send reminders about upcoming deadlines for open enrollment, PTO usage, and tax form submissions.
   • Provide updates on any policy changes or year-end adjustments.
2. Plan for Q1 Staffing Needs
   • Evaluate your workforce plan to address gaps or surpluses for the upcoming year.
3. Leverage Technology
   • Use HR software to automate tasks such as payroll reconciliation, tax form preparation, and benefits enrollment.
4. Partner with a PEO
   • Outsourcing year-end HR and legal tasks to a PEO like SolveHR ensures compliance and frees up your time to focus on strategic planning.

How SolveHR Can Help

Preparing for year-end can be overwhelming, but SolveHR specializes in helping businesses like yours navigate this busy season with ease. Our team of experts offers services such as payroll audits, compliance updates, benefits planning, and tax form preparation, ensuring your business meets all legal and HR requirements. With SolveHR as your partner, you can confidently close out the year and set the stage for a successful 2026.Year-end preparation is an essential part of running a compliant and efficient business. By addressing key legal and HR requirements early, you can avoid last-minute stress and set your company up for success. Contact SolveHR today to learn more about how we can support your year-end needs and help you prepare for the challenges and opportunities of the year ahead.