In today’s rapidly evolving regulatory landscape, maintaining compliance is one of the most significant challenges for employers. With varying state and federal requirements, ensuring your organization meets all necessary guidelines can be daunting. During a recent virtual panel, HR experts from MP shared their insights on mantaining compliance in 2025, focusing on critical areas such as the Affordable Care Act (ACA), Equal Employment Opportunity (EEO) reporting, and the complexities of multi-state employment. 

Understanding the Evolving Compliance Landscape 

Regulatory frameworks continue to evolve, requiring employers to stay vigilant and adaptable. In 2025, businesses face increasing scrutiny in several areas, including health coverage, workforce demographics, and remote work compliance. Failure to meet these requirements can lead to legal challenges, financial penalties, and reputational damage. 

Employers must adopt a proactive stance, utilizing technology and expert guidance to navigate these complexities. As regulations shift, organizations that prioritize compliance and maintain accurate documentation will be better equipped to manage audits and regulatory inquiries. 

Navigating ACA Compliance 

One of the most pressing issues facing employers is compliance with the Affordable Care Act (ACA). As companies grow and employee demographics shift, many organizations struggle to determine if they qualify as an Applicable Large Employer (ALE). Employers with 50 or more full-time equivalent employees must offer affordable health coverage that meets minimum value standards. 

A common pitfall occurs when employers overlook part-time and seasonal employees in their calculations. For example, an employer with 80 part-time employees may still meet the ALE threshold, triggering ACA reporting requirements. HR professionals emphasize the importance of monitoring employee hours and understanding measurement periods, including: 

• Measurement and Look-Back Periods: Tracking hours to determine full-time status. 

• Providing Necessary Notices: Such as the notice of health insurance marketplace coverage and summary of benefits. 

• Annual Reporting: Completing forms like 1094-C and 1095-C, which must be provided to employees and filed with the IRS. 

In addition to traditional health coverage, some employers are adopting the Individual Coverage Health Reimbursement Arrangement (ICHRA). This alternative allows businesses to reimburse employees for health insurance obtained independently. However, ICHRA adds complexity to ACA compliance and reporting, requiring precise documentation to avoid legal and tax complications. 

The Risks of Non-Compliance 

Failure to comply with ACA requirements can lead to substantial financial penalties. The government primarily monitors two key areas: 

1. Affordability: Ensuring employee premiums meet affordability thresholds, which change annually. 

2. Coverage Offerings: Confirming that employees receive offers of qualified health coverage. 

Penalties can escalate quickly, particularly if an employer fails to offer coverage to eligible employees. Regular audits and working closely with HR professionals can help identify gaps and mitigate risks. For instance, in 2025, the IRS is expected to increase enforcement efforts, making it even more critical for employers to stay on top of their obligations. 

Leveraging Technology for Compliance 

Compliance becomes more manageable with the right tools. For instance, platforms like iSolved from MP offer large employer compliance test reports, which track part-time employees and alert businesses as they approach the ALE threshold. Implementing such solutions provides a proactive approach to ACA compliance. 

Technology also facilitates accurate record-keeping and streamlined reporting. Automated systems reduce human error, ensure deadlines are met, and provide audit trails for future reference. Investing in compliance software can save time and protect your organization from costly mistakes. 

EEO Reporting and Compliance 

Another critical area is Equal Employment Opportunity (EEO) reporting. Employers with 100 or more employees must submit annual EEO-1 reports detailing workforce demographics by job category, race, ethnicity, and sex. With a deadline of June 4, 2025, organizations should begin tracking employee data well in advance. 

HR professionals recommend that businesses start monitoring workforce demographics when their employee count reaches 85 to 90. This proactive approach ensures readiness should the organization surpass the 100-employee threshold. Multi-state employers must also consider whether their collective workforce triggers reporting obligations. 

Beyond compliance, EEO reporting supports diversity, equity, and inclusion (DEI) initiatives. Accurate data allows businesses to assess workforce representation, identify gaps, and implement targeted strategies to foster an inclusive environment. 

Managing Multi-State Compliance 

The rise of remote work continues to create new challenges for tax and employment law compliance. When employees move across state lines, employers must navigate varying state tax laws, benefit requirements, and leave entitlements. Key considerations include: 

• Work Location vs. Home Location: Determining where the employee primarily works influences tax withholding and unemployment insurance. 

• State-Specific Policies: Some states have unique payroll taxes and leave laws that apply to remote employees. 

• Timely Reporting: Notifying relevant state agencies when employees move to ensure compliance. 

HR experts advise prompt communication when employees relocate to ensure compliance with new state regulations. This proactive approach prevents issues with tax filings, benefit eligibility, and employment protections. Additionally, multi-state employers should establish standardized processes for managing remote work policies and tracking employee locations. 

Preparing for Pay Transparency Laws 

Another emerging issue is the expansion of pay transparency laws, which vary widely by state. These laws may require employers to disclose salary ranges in job postings, provide pay scale information to current employees, and maintain records of pay equity. Staying informed of state-specific requirements and adapting internal processes accordingly will be crucial in 2025 and beyond. 

Employers should regularly audit pay practices to identify and address potential inequities. Transparent communication about compensation policies fosters trust and aligns with broader DEI objectives. As more states adopt these regulations, businesses that prioritize pay transparency will enhance their employer brand and reduce legal risks. 

Partnering with HR Professionals for Success 

Given the complexities of modern compliance, having experienced HR professionals on your team is invaluable. Whether working with internal HR staff or external partners, businesses benefit from expert guidance and up-to-date knowledge of regulatory changes. Regular audits, leveraging technology, and maintaining open communication channels ensure that your organization stays ahead of compliance challenges. 

If your organization needs assistance navigating ACA reporting, EEO compliance, or multi-state regulations, don’t hesitate to reach out. Staying proactive and informed is the key to achieving and maintaining compliance in 2025. 

Make sure to subscribe to MP’s blog and stay on top of the most up-to-date news and trends in the business realm.