2022 HR Compliance: 5 Critical Considerations for Employers

Employers and HR leaders should use the same basic strategies to maintain compliance every year: perform a compliance audit and update their employee handbook, ensure compliance with all relevant state, federal, and industry rules and regulations, and train managers to consistently carry out policies. Additionally, HR departments should be updated on compliance requirements and employment laws to pay special attention to every year. Here are the top HR compliance considerations for employers in 2022.

5 Top Considerations for 2022 HR Compliance

1. Whenever filing with the IRS, e-file and request direct deposit.

As HR teams, payroll departments, and CPAs prepare to complete IRS activities such as ACA reporting and filing taxes, they should choose to e-file or direct deposit when applicable. Due to budget cuts, the pandemic and related staffing shortages, as well as the popularity of the Employee Retention Credit (ERC) program, the IRS is more short-staffed than ever in 2022. Companies will avoid the possibility of erroneous late fees, having important documentation lost, or long turnaround times for processing their taxes and refund requests.

2. Focus on retaliation and payment practices to prevent Department of Labor investigations.

This year, the Department of Labor is on track to hand out a record number of fines and penalties. They seem particularly concerned with retaliation and payment practices. Retaliation claims right now commonly pertain to COVID, including requests for accommodations under the Americans with Disabilities Act (ADA) and sick time. Payment practices are frequently related to employees who claim they aren’t being compensated for all hours worked. This can be particularly challenging when employees are working from home. Employers should also note their whole company and all its practices may be investigated once they’re investigated for one complaint. Some employers have undergone investigations for one infraction, but then incurred steep penalties and fees for many other violations the DOL also found.

3. Prioritize safety to prevent OSHA investigations, especially due to COVID complaints.

OSHA has notably been active in responding to COVID safety claims from workers. If it’s not already a top priority on their HR compliance checklist, employers should give COVID safety more consideration. Even if an organization isn’t subject to any federal law surrounding COVID safety, it may still be subject to state or city laws and regulations. Many states and cities are developing their own COVID safety regulations. Employers with remote employees or multiple states where employees perform work will be subject to compliance with more regulations. Additionally, ensure your employees are aware of all COVID safety measures you’re taking. Many OSHA investigations are a result of an employee complaint.

4. Ensure compliance with all relevant state laws.

More companies are allowing remote work, full-time or hybrid. Because remote employees perform their work where they live, employers must maintain compliance in remote employees’ home states. Many states have varying laws, especially regarding their approach to COVID. Some have masking mandates; others have mandates against masking requirements. Some have COVID leave programs, which require employers to offer paid time off for vaccination and illness. These programs frequently reimburse employers for this paid time off. In addition to COVID, these are some of the trends in state compliance laws in 2022:

• Limitations or bans on non-compete agreements
• Natural hairstyles added as a protected class
• Disability protections extended to people associated with disabled people (generally to benefit caretakers)
• New laws requiring employers to compensate employees at their overtime rate when they miss a mandatory meal break
• The states that are most active in creating new labor laws are: California, Oregon, and Illinois

5. Properly classify all employees and independent contractors.

This year, the DOL will be taking more action to reinforce and regulate how independent contractors are classified. They will examine and update the classification rules and exact more penalties for misclassifying workers. In addition to maintaining compliance with the NLRB’s rules, employers should also be motivated to avoid legal action. Recently, more employees have been suing employers over misclassification, especially regarding how they’re paid and the protections they’ve received during the pandemic. Employers should note that through the pandemic and labor shortages, many of their workers who were previously salaried and exempt may have taken on non-exempt job duties. These changes may jeopardize their exempt status. Misclassification of workers is a hot-button issue employers should avoid.