The Checklist
Core HR compliance requirements — every employer
These apply regardless of your state, industry, or how many employees you have. Get these right first.
Form I-9 for every new hire (verify documents within 3 business days)
Federal W-4 before first paycheck
State withholding form (if your state has income tax)
New hire report to state registry within 20 days
Written pay rate notice (required in CA, NY, IL, WA, TX, and others)
Pay at least your state's minimum wage (many exceed federal $7.25)
Pay overtime (1.5x) to nonexempt employees for 40+ hrs/week
Withhold and remit FICA, federal income tax, state income tax
Pay FUTA and state unemployment insurance (employer-side)
Provide compliant pay stubs (required contents vary by state)
Issue final pay by state deadline upon termination or resignation
FLSA minimum wage poster (all employers)
OSHA safety rights poster (all employers)
EEOC equal employment poster (all employers)
NLRA employee rights poster (most employers)
FMLA poster (50+ employees)
All required state posters for your state
Workers' compensation insurance (required in nearly all states)
State unemployment insurance registration
COBRA notice within 44 days of qualifying event (20+ employees)
Summary Plan Description within 90 days (if you offer a health plan)
State disability or paid family leave contributions (CA, NY, NJ, WA, OR, CO, MA)
FMLA leave (12 weeks unpaid job-protected leave at 50+ employees)
Paid sick leave (20+ states require it — check yours)
State paid family and medical leave programs where required
Pregnancy/parental leave protections (many states cover all sizes)
Jury duty and military leave protections (federal + state)
I-9 files: 3 years from hire or 1 year after termination
Payroll records: 3 years (FLSA), 4 years (IRS)
Time and attendance: 2 years minimum
OSHA 300 log: 5 years (10+ employees in covered industries)
Personnel files: best practice 7 years post-termination
By Employee Count
When federal laws kick in based on headcount
Many employment laws have thresholds. Here's when the major requirements apply — state laws often reach smaller employers.
| Size |
Laws that apply |
| 1+ employees |
FLSA (minimum wage & overtime), I-9/E-Verify, EPPA, USERRA, FLSA child labor, most state anti-discrimination laws |
| 15+ employees |
Title VII (race, sex, religion, national origin), ADA (disability), GINA (genetic information), Pregnancy Discrimination Act |
| 20+ employees |
ADEA (age 40+), COBRA continuation coverage |
| 50+ employees |
FMLA (12 weeks unpaid leave), ACA employer mandate, EEO-1 annual reporting |
| 100+ employees |
WARN Act (60-day notice for plant closings/mass layoffs), expanded EEO-1 |
Note: state laws often have lower thresholds than federal. Many state anti-discrimination laws cover employers with 4 or fewer employees.
Frequently Asked Questions
HR compliance — common questions
What are the HR compliance requirements for small businesses?
At minimum: complete I-9 for all new hires, withhold and remit payroll taxes, display required federal and state posters, report new hires to the state, carry workers' comp (most states), comply with minimum wage and overtime rules, and follow anti-discrimination laws. Additional requirements depend on your state and headcount.
When do I have to comply with federal anti-discrimination laws?
Title VII, ADA, and the Pregnancy Discrimination Act apply at 15+ employees. ADEA (age discrimination) applies at 20+. But many state laws apply from day one — California, New York, New Jersey, and others cover smaller employers. Check your state's rules.
Am I required to offer health insurance?
Businesses with fewer than 50 full-time equivalent employees are not required to offer health insurance under the ACA. Businesses with 50+ FTE employees must offer coverage to full-time employees (30+ hrs/week) or face the employer shared responsibility payment.
What's the difference between a 1099 contractor and a W-2 employee?
Classification depends on the economic reality — not what you call them. Key factors: who controls how work is done, whether the worker uses their own tools, and whether the work is integral to your business. Misclassification exposes you to back payroll taxes, penalties, and wage claims. California, Massachusetts, and New Jersey use especially strict tests.
What HR records must I keep and for how long?
I-9s: 3 years from hire or 1 year after termination. Payroll: 3 years (FLSA), 4 years (IRS). Time records: 2 years. OSHA logs: 5 years. FMLA: 3 years. Personnel files: 7 years after termination is best practice. Some states require longer.
Is workers' compensation required?
Yes, in almost every state. Texas is the only state where it's technically voluntary for private employers — though non-subscribers lose important legal protections. Most states require coverage from the first employee. Penalties for non-compliance include fines and personal liability for workplace injury claims.
What's the most common HR violation for small businesses?
The top violations are: misclassifying employees as independent contractors, failing to pay overtime to nonexempt employees, late final pay at termination, incomplete I-9 forms, not displaying current required workplace posters, and missing state-specific required notices at hire. Most are correctable before an audit — run a
free compliance check to identify your gaps.
What payroll taxes am I responsible for as an employer?
Federal employer taxes: FICA employer share (6.2% Social Security + 1.45% Medicare), FUTA (6% on first $7,000 per employee — reduced to 0.6% with state credit for most employers). State: unemployment insurance (rate varies by experience), plus state-specific employer taxes (California SDI, New Jersey disability, etc.).