As the year winds down, there’s no better time to reflect, regroup, and get things right for the road ahead.
For small businesses, a little preparation now can keep you from facing bigger headaches later. At Employers Advantage, we understand the unique challenges small businesses face, and we’re here to help, so grab a warm beverage, pull up a chair, and as we chat, we will unwrap the top 10 HR compliance mistakes to not make in 2025.
1. Misclassifying Employees - Don’t Wing It – It’s not worth that lump of coal!
Let’s all agree, small businesses owners know a good deal when we see one, but cutting corners on classifying employees can land you in hot coals faster than chestnuts roasting on an open fire. Whether it’s exempt vs. non-exempt or independent contractors, make sure everyone is labeled correctly.
GOLD STAR Practice:
· Review those job duties like Santa’s checking his list —thoroughly and often twice!
· When in doubt, consult with the HR experts to double-check your classifications as that is much easier than a post-holiday audit.
2. Skipping Required Training: It Isn’t Optional so Don’t be a GRINCH!
Sure, it’s been a busy year, and yes, sometimes costs are associated, but some things just can’t be put off. If your state requires training on topics like harassment prevention, missing it can leave your business vulnerable to fines—and worse, bad public relations. It is equally as important as the holiday office party, if you skip it, you will regret it later.
GOLD STAR Practice:
· Schedule annual training like you’d schedule spring planting or end of year celebrations — it must become part of the routine.
· Keep records to show you’ve done your due diligence.
· Use online platforms to make it easier for your employees to participate
· And don’t forget to make sure you pay the employees for their time spent attending training!
3. Sloppy Record-Keeping: Tidy Up Before the New Year
You wouldn’t forget to put fresh sheets on the guest bed or leave the house undecorated for the holidays, don’t let your employees’ records stay a mess. Missing or incorrect records can cause a heap of trouble come audit time, please don’t neglect your employee documentation.
GOLD STAR Practice:
· Audit your files like you’d inventory the pantry before a holiday feast or like you are checking off gifts on your shopping list.
· Invest in a user-friendly HR software to keep everything neat and tidy – it will keep your employee records as tidy as your well-organized decoration bins.
4. No Handbook? Bless Your Heart – This isn’t last minute gift shopping.
Running a business without a clear employee handbook is like cooking without a recipe or arriving at a gift exchange without a gift—sure, it might turn out okay, but why risk it? Often, it simply becomes awkward and can lead to trouble. Your team deserves clear guidance.
GOLD STAR Practice:
· Draft a handbook that lays out everything from PTO to workplace etiquette.
· Update it annually—just like your holiday card list.
5. Ignoring Wage & Hour Laws: Don’t Get Caught Short – No one likes a Scrooge!
Nobody likes shortchanging a good day’s work. But without tracking hours and overtime correctly, you could be doing just that—and risking a legal showdown. Paying employees correctly is more than just nice—it’s required. Ignoring wage and hour laws could leave you handing out apologies instead of holiday bonuses.
GOLD STAR Practice:
· Use reliable timekeeping tools, not sticky notes.
· Make sure your managers understand wage laws like the back of their hands.
· Handle Travel time correctly with your non-exempt employees
· Don’t forget to claim those holiday bonuses and other benefits provided on employee W2’s.
6. Mishandling Leave Requests: Know the Rules and Keep the Spirit of Generosity
The holiday season reminds us to show kindness, and that extends to properly handling employee leave under laws like FMLA or state-specific rules. In the South, we pride ourselves on hospitality, but even the best intentions won’t save you if you mishandle employee leave.
GOLD STAR Practice:
· Brush up on federal laws like FMLA and any state-specific leave requirements.
· Create a simple and streamlined process for employees to request leave—think easy as pecan pie.
7. Overlooking Anti-Discrimination Policies: Set the Standard
The holiday spirit is all about inclusion, so make sure your anti-discrimination and harassment policies reflect that. Clear policies create a workplace where everyone feels welcome. We all know the Golden Rule: Treat others as you’d like to be treated. But a strong anti-discrimination policy isn’t just polite—it’s the law.
GOLD STAR Practice:
· Put clear policies in writing, and don’t be afraid to enforce them.
· Train your team to speak up when they see something wrong.
· Consider an outside third-party reporting option such as the Employers Advantage Offering of our Speak Up Hotline Partnership.
8. Falling Behind on Legal Updates: Stay Sharp and Don’t get left in the cold!
The laws change faster than holiday gift trends (remember that mounted singing fish or how about ugly sweaters?). Staying updated is critical to avoid unwelcome surprises in the new year.
GOLD STAR Practice:
· Subscribe to updates from trusted HR resources.
· Sign up for HR Newsletters or attend webinars to stay informed.
· Bring in an expert when you’re not sure about a change in the rules.
9. Messy Terminations: Handle With Holiday Cheer
No one likes saying goodbye, but when it comes to letting employees go, you’ve got to follow the right steps—or risk a bigger mess than Aunt Bethany’s Jello mold disaster. If you are ending the year with a termination, we all know that is never ideal, but if it’s necessary, handle it with care and professionalism. Forgetting documentation or mishandling the process can lead to trouble.
GOLD STAR Practice:
· Document everything, from performance reviews to termination reasons.
· Follow a consistent, lawful process.
· Ensure that conversations are respectful and compliant with the law-think of it as giving closure, not coal.
10. Neglecting Workplace Safety: Safety First, Y’all
Around here, we believe in looking out for one another, and that includes keeping the workplace safe. OSHA rules exist for a reason and ignoring them is asking for trouble. The last thing you need during the festive holiday season is an OSHA violation or a workplace accident. After all, the fall doesn’t kill you it’s that sudden stop at the end! Poor humor attempt for sure, but seriously please do not attempt to make safety a laughing matter this year.
GOLD STAR Practice:
· Host regular safety training and make it as engaging as a good story at Sunday supper.
· Document attendance for all safety training sessions.
· Keep records of safety checks and incident reports.
· Review your safety protocols as part of your year-end checklists.
· Don’t forget to include emergency responses to natural disasters and potential workplace violence as well when reviewing your safety protocols.
Closing Thoughts
As the year comes to a close, let’s make a resolution to keep our businesses running smoothly and in compliance. Tackling these HR challenges now will save you from playing catch-up later and start the year on the right foot!
Need a Helping Hand?
If this sounds overwhelming, don’t fret. Employers Advantage is here to be your trusted HR partner. Contact us today and here’s to a new year filled with success, growth, and compliance done right!
Cheers, y’all to a safe, successful, compliant, and joyful 2025!
