2023 HR year-end checklist to finish the year strong

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Preparing for employment law changes, finalizing next year’s hiring and recruiting strategy, restructuring employee benefits packages… The end of the year is a busy period for the HR department.

With so many items on their to-do list, it’s easy for HR professionals to miss something important from the many tasks they have to complete by December 31st. We have compiled a detailed HR year-end checklist to make sure you’re all set up for the new year.

End-of-year HR checklist: reminders to employees

As the year comes to a close, it’s not just the members of the HR team who have things to do, but also the employees. To make sure employees don’t forget about their year-end tasks, HR needs to send out several reminders . This includes reminding employees to:

• Take their unused vacation days if the PTO policy doesn’t provide for PTO roll-over,
• Check and update their personal information if needed,
• Use up any outstanding ancillary benefits that will expire by the end of the year,
• Familiarize themselves with any changes to their insurance and benefits plans,
• Submit receipts for work-related expenses for reimbursement, and
• Provide any additional information needed for end-of-year tax reporting.

HR year-end checklist: payroll tasks to complete

Depending on whether payroll reports to HR or Finance in your organization, the HR department might also have to take care of all the year-end tasks relating to payroll . This includes:

• Confirming and scheduling year-end bonuses,
• Double-checking filing requirements (federal, state, and local requirements)
• Gathering the necessary forms for filing payroll taxes or registering for electronic tax filing,
• Checking for any outstanding payments ,
• Verifying employee and employer information, such as employer tax number and social security number, employee names and addresses, and more,
• Recording special tax items, such as fringe benefits, employee expense reimbursements, stock options , bonuses and commissions ,
• Reconciling wages and taxes, bank statements, accounts payable, third-party payments, and the entries in the general ledger account,
• Confirming next year’s payroll schedule and sharing the dates of the different pay periods with employees,
• Running a year-end payroll audit to ensure that all your payroll data , processes, and records are in order,
• Finalizing your tax reporting, including the preparation of fourth-quarter payroll tax returns and annual tax reports, such as payroll summary report and employee summary report, and
• Preparing for the first payroll run in the new year.

The complete year-end payroll checklist

HR compliance checklist: final check before the end of the year

The end of the year is the perfect opportunity for businesses to run an in-depth compliance assessment in their HR department. Aspects to check include:

• Worker classification: Use the end of the year to review the classification of your workers to mitigate disguised employment risks and prevent employee misclassification penalties.
• Active employees: Throughout the year, the number of employees on your payroll changes as new employees join the company and others leave to retire or start a new position elsewhere. Joiners and leavers should be properly recorded and removed from/added to the payroll in a timely manner.
• Legal changes: Changes in employment, taxation, and payroll laws often happen around the turn of the year. Therefore, a crucial task on any business’s year-end checklist for HR is to check if there are any impending legal changes and make the necessary preparations.
• Overtime stats: Overtime is often subject to legal limits and special pay rates. Checking employee overtime hours and payments is an important part of your end-of year HR compliance check.
• Employee files: HR needs to keep and record all employee-related information, data and files. The end of the year is a good time to go through your records and make sure everything is in order.
• Employee benefits: Statutory benefits requirements change frequently. Make sure to include a review of your employee benefits policies and related payroll processes in your HR year-end checklist.
• Pay rates: Changing minimum wage rates and compensation rules require businesses to constantly adjust their pay rates. A final review at the end of the year is mandatory.
• Non-discrimination tests: Conducting non-discrimination tests is a great way of reviewing the fairness of diverse HR processes and initiatives. This includes fairness in the hiring and recruiting process, employee benefits packages, employee compensation (e. g. gender pay gaps ), and more.