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Don’t FALL Behind – Be Proactive on Year End HR Processes!

Sep 28th, 2023

Don’t FALL Behind – Be Proactive on Year End HR Processes!

The last quarter of the year always seems to fly by! Don’t be left unprepared! Take a look at your year-end responsibilities early so you have a smooth transition into the new year!

Verify Employee Information BEFORE Year-End tax or Benefits Forms Go Out.

Avoid the influx of panicked calls from your employees right as the tax or benefits deadlines hit! Communicate with employees now!

  • Validate employee addresses. Start communicating with employees now to update their address, contact, and beneficiary information. Incorrect information could delay receipt of W-2 forms for some employees and create waste for your business with the printing and mailing.
  • Verify all Social Security numbers or federal employer identification numbers (FEIN). Missing or incorrect information could result in a penalty by the Internal Revenue Service (IRS) for each W-2 returned.
  • Check your records for employees who left the company during the year to make sure their employment status was correctly updated. This will help you avoid incorrect forms going out.

Remind Employees of Year End Deadlines

Do you have policies or benefits that end in December? Send out a reminder now to avoid last-minute outreach.

  • Flexible Spending Account Deadlines – most FSAs have a “a "use-it-or-lose-it" policy. Does your plan offer a grace period into the new year? Send out reminders to employees so they can use up any funds that still remain.
  • Review Employee Time Off - If you have a self-service portal, remind employees to review their vacation, holiday, sick, and paid-time-off banks, especially if you have a "use-it-or-lose-it" policy (where permitted) or caps on carryover amounts. If your business tracks this for employees, you may wish to notify them about their balances. This will help avoid an influx of requests in December.
  • Performance Reviews – is the end of the year performance review season? Ensure communication goes out to employees and managers in advance so performance reviews are given enough attention and don’t feel rushed.

Important Compliance Deadlines and Areas to Review

  • Filing W-2s - Generally, by Jan. 31, employers must provide Form W-2 to employees so that they can file their federal and state taxes. A copy of each employee's W-2 must also be sent to the Social Security Administration (same deadline).
  • Affordable Care Act (ACA) reporting - Applicable large employers must furnish Form 1095-C to applicable employees by March 2, 2024. The employer process has changed for 2024 and most businesses will now be required to file electronically – make sure you are prepared!
  • Review Wage and Hour Updates - If your applicable state or local minimum wage rate is increasing as of Jan. 1 or on a different date in 2024, ensure the updated rate is reflected for applicable employees' pay as of the effective date. In addition, review your obligations under applicable state and/or local laws with respect to wage and hour matters.
  • Review Coverage Plans and Health Insurance Policies – do your group health plans renew Dec1 or Jan 1?
    • Review coverage plans and pricing to determine if changes are needed.
    • Prepare communications with employees and schedule informational meetings for Open Enrollment.
  • Medicare Part D Notice of Creditable Coverage – Employers must deliver notice to plan participants by October 13th.
  • Confirm Year-End Bonuses - If your business awards year-end discretionary bonuses, work with your payroll provider to issue the checks, either as a separate line item or in separate checks (additional bonus taxation may apply).

Other Compliance Considerations

Update Your Employee Handbook - An annual review of your employee handbook should be included in your year-end checklist. All new policy updates should be included in the handbook and communicated to employees.

Compensation Policy Review - The new year is a great time to review employee compensation to make sure you are competitive with the 2024 hiring market.

Training Review – Do you require annual training for your employees? Ensure all staff are up to date on required or job-related training.

Document Retention – do you have any documents or files that are hitting their retention deadline? Mak sure to purge documents as they age out. (think about a possible Personnel File Audit or an I-9 audit to ensure you’re not out of compliance!)

Not sure where to start? Reach out to one of our HR Experts and let us help you get ahead!

This information is provided for informational purposes only and should not be taken as legal advice. The O’Connor Group makes no representations as to the completeness, suitability, or validity of any information contained herein and will not be liable for any errors or omissions.

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