HR Compliance: What You Don’t Know Can Hurt You

Employment laws change constantly. Are you keeping up?

Many businesses unknowingly violate labor laws, exposing themselves to lawsuits, fines, and reputation damage.

HR compliance is more than just paperwork—it’s business protection. A single misclassification, unpaid wage, or improper termination can lead to costly legal battles.

Are you confident your business is 100% compliant?

3 Major HR Compliance Risks (And How to Fix Them)

1 Employee Misclassification: 1099 vs. W-2 Workers

• Independent contractor or employee? Misclassifying workers can trigger IRS penalties and back taxes.

• Many businesses misclassify workers to save on benefits—but the Department of Labor (DOL) is cracking down.

• Penalty: The IRS can fine up to $50 per W-2 not filed, plus additional taxes and interest.

Solution: Ensure correct classification & contracts for all employees. Conduct regular workforce audits to confirm compliance with federal and state regulations.

2 Wage & Hour Violations: Overtime & Minimum Wage Errors

• Unpaid overtime, miscalculated wages, and labor law noncompliance lead to lawsuits.

• The Fair Labor Standards Act (FLSA) requires proper tracking of employee work hours, breaks, and overtime pay.

• Penalty: Companies violating wage laws face fines of up to $1,100 per violation and possible class-action lawsuits.

Solution: Conduct payroll audits, track hours properly, and ensure fair overtime practices. Investing in HR technology (such as time-tracking software) can automate compliance and prevent costly errors.

3 Termination & Disciplinary Risks: Wrongful Termination Claims

• One wrongful termination lawsuit can cost a business over $125,000 in legal fees alone.

• Employers must document performance issues, follow due process, and ensure proper termination protocols.

• At-will employment does NOT mean you can fire employees without cause.

Solution: Implement structured performance management with written warnings, progressive discipline, and clear policies to prevent disputes. Always conduct exit interviews and document the reasons for termination.

Is Your Business at Risk for HR Compliance Issues?

If your company is experiencing:
* Unclear classification of employees vs. contractors
* Payroll or overtime errors leading to complaints
* No structured performance documentation for employee terminations
* Outdated HR policies that don’t align with current labor laws

It’s time to proactively fix compliance gaps before they cost you.

Tag us in. Let’s protect your business from compliance risks. Book an HR audit today.

HR COMPLIANCE MISTAKES CAN COST YOU.

Did you know misclassifying employees, ignoring overtime laws, or failing to document performance issues can lead to major lawsuits?

* Avoid compliance risks with proactive HR policies.
* Stay ahead of labor law changes before they cost you.
* Protect your business from fines, penalties, and legal claims.

Let’s make sure your business is HR-compliant.

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