Conscious Stewardship

End-of-Year HR Checklist for Small Businesses (2023)

2023 end of year hr checklist for small businesses
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The employment and labor law changes never cease, and 2024 is providing no shortage of HR updates for small businesses! Thankfully, Return to Eden Consulting has you covered with an end-of-year HR checklist for your small business with the most important items related to payroll, benefits & compliance to help you end the year well and prepare for a great new year ahead.

end of year hr checklist for small businesses

End-of-Year HR Checklist for Small Businesses

PAYROLL

  1. Address/Personal Info Updates: Remind Employees + Contractors to verify or update their address and contact info, if needed, by December 31. You can do this through your company’s HRIS/Payroll Provider (we’re huge fans of BambooHR Gusto). It’s important this information is accurate so W2 + 1099 forms are provided with accurate information to the correct address.
  2. Prepare W2 + 1099 Forms: If you have employees, prepare all W2’s and deliver no later than January 31. If you paid any contractor $600 or more, a 1099 must be provided to these individuals by January 31 as well. BambooHR or any other HRIS/Payroll provider should prepare these for you & allow you to review for any errors prior to being mailed and/or e-mailed out.
  3. File Year-End Payroll Tax Returns: Hopefully, you’re utilizing a great HRIS/Payroll provider because if so, they provide this service for you! If not, make sure all payroll tax returns are processed and submitted by you or your tax professional by December 31.

BENEFITS

  1. Affordable Care Act (ACA) Reporting: If you employ more than 50 full-time employees, or if you sponsor a self-insured group health plan, you’re likely required to file a 1095-B, 1095-C and/or a 1095-B form with the IRS in any state where you have employees.
  2. Finalize Open Enrollment Elections: If you offer health benefits and are on a calendar plan year, your updated benefit plans will start as of January 1. Be sure your team knows the Open Enrollment Deadline so they submit their benefits elections before the plan year starts!
  3. 401k Program Registration: 15 states now require employers of any size to provide a 401(k) program to their employees. California, for example, required those with 5+ employees to register for the CalSavers program (a state run program) or offer their own retirement plan no later than December 31, 2022. CA businesses with less than 5 employees have until December 31, 2025 to get on board.
  4. 401k Catch-Up Contributions: Some employees may want to contribute an “extra” 401(k) contribution to their account to contribute the max amount allotted by the IRS. Be sure your employees know the last date to make changes to the final payroll of the calendar year so they don’t miss out on this opportunity.

MINIMUM WAGE/SALARY CHANGES

  1. Review Updated Minimum Wage: 16 states are set to increase their minimum wage as of January 1. On top of that, several local cities/counties have made the decision to surpass the state minimum wage. Connect with your People Ops team to see if any changes impact your business. If so, share these changes with your team & update your HRIS/Payroll system before the 1st paycheck of 2024.
  2. Review Updated Minimum Salary Requirements: States may also have their own minimum salary requirements for exempt employees. Starting January 1, 2024, California, for example, has a minimum exempt salary threshold of $66,560 for employers of all sizes. California also has a minimum exempt salary threshold of $115,763.35 for Computer Software employees. Connect with your People Ops team to see if there are any required changes to salaries for your team.

LEGAL COMPLIANCE

  1. Review Harassment Training Requirements: Several states require businesses to provide harassment training to their employees and people managers. Ensure your team has completed all required training before the end of the year. Also, look ahead to see if any one is due for a required training update in the new year.
  2. Review Updated Labor Laws: A slew of labor + employment law changes across several states will occur once January 1 hits. If you have even 1 employee in any of these affected states, you’ll need to ensure you’re providing updated info. Connect with your People Ops team to ensure your brand is legally sound (aka compliant) with any requirements. Below are only a few examples of changes happening January 1 –
    • California
      • SB497 – Creates an automatic presumption of retaliation if an employee is disciplined or discharged within 90 days of a complaint involving certain Labor Code provisions or unequal pay. This one is a BIG deal and truly highlights the importance of leading with purpose to cultivate a conscious, healthy business. The law also adds a civil penalty of up to $10,000 per employee for each violation.
      • SB848 – Employers must allow eligible employees to take up to five days of leave following a reproductive loss event, which is the day or final day of a failed adoption or surrogacy, a miscarriage or stillbirth, or an unsuccessful assisted reproduction.
      • SB616 – Revises the state’s paid sick leave law by increasing the yearly accrual cap from 48 to 80 hours (i.e. from 6 to 10 days of paid sick leave) and the yearly usage limit from 24 to 40 hours (3 to 5 days).
      • SB700 – Makes it unlawful under the Fair Employment and Housing Act (FEHA) for an employer to discriminate against a job applicant based on information regarding prior use of cannabis that is learned from a criminal history. After January 1, 2024, employers will no longer be allowed to request information from an applicant for employment relating to the applicant’s prior use of cannabis. 
    • Colorado
      • Paid Medical + Family Leave – if an employer does business in Colorado, they were required to pay into Colorado’s Paid Medical + Family Leave program starting January 1, 2023. Employees are able to take this paid leave starting January 1, 2024.
    • Illinois
      • SB3616 – Amended the states’ Human Rights Act, which prohibits employers from engaging in discrimination based on numerous protected characteristics, including race. This amendment expands the definition of “race” to include traits associated with race, including but not limited to hair texture and protective hairstyles such as braids, locks, and twists.
      • Paid Leave for All Workers Act – requires employers to provide up to 40 hours of paid leave during a 12-month period starting January 1, 2024
    • Massachusetts and Maryland
      • Both Massachusetts and Maryland will increase requirements for their respective Medical + Paid Family Leave contribution and maximum weekly benefits, starting January 1, 2024. This impacts employees and the backend of your payroll systems so ensure your contribution rate + withholding amounts are correct in your system.

Proactively Update Employee Handbook + Policies

As a result of these upcoming HR changes, now is a great opportunity to review your Employee Handbook or team policies + procedures to ensure your business is protected and your team is supported. If you don’t have an Employee Handbook yet, Return to Eden Consulting has you covered! Within our Restorative Business Transformation offering, in just 3 months we will craft the unique People Ops/HR foundation that speaks to the mission, vision + values of your growing brand, while also ensuring the needed legal requirements you have as a small business are buttoned up tight – including a personalized + branded employee handbook!

Finish Well

As you close out the year, refer back to this end-of-year HR Checklist for your small business to make sure nothing is left out. If you’re ready to consciously scale your brand in 2024, Return to Eden will partner with you to ensure this happens from a proactive and restorative space. We’d love to create a purposeful People Ops strategy that supports the holistic growth of your business.

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ADVENTUROUS, 3/5 MANIFESTING GENERATOR, WIFE + MAMA, QUESTIONER, NATURE LOVER. 

Hey, I'm Dominique.
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I believe entrepreneurs are vision holders for creating an authentic and deeply meaningful human experience. I love to partner with creative business leaders who choose to be disruptive in the way they nurture growth for their brand, their team + the greater collective.

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DISCLAIMER: The content of www.returntoedenhr.com and any HR support provides practical and HR best practice information/recommendations and is not legal advice. This website is solely intended for general information purposes. Nothing on this site should be taken as legal advice for any individual, case, or situation. No past results serve in any way as a guarantee of future results. Return to Eden Consultingᵀᴹ, LLC does not provide legal advice or other professional services. While every effort is made to provide accurate and current information, laws change regularly and may vary depending on the state and/or the municipality your business operates in. The information provided from Return to Eden Consultingᵀᴹ,LLC is not a substitute for legal advice or your professional judgement. You should review applicable, federal, state and municipality laws in your jurisdiction and consult with legal counsel as you deem necessary.

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