518-373-4111
As 2025 draws to a close, small businesses face a critical window to tidy up HR operations and prepare for the year ahead. While larger organizations may have dedicated teams for each HR function, small businesses often rely on lean teams or even single individuals to manage everything from compliance to employee engagement. That’s why having a clear, actionable year-end checklist is essential.
Small businesses should consider prioritizing the following HR activities before the end of 2025 to stay compliant, support their workforce, and set the stage for a successful new year:
1. Complete performance reviews
Use this time to formally evaluate employee performance, set goals for the upcoming year, and identify opportunities for growth or training. In small businesses, these reviews can be especially impactful for retention and morale, as they provide personalized feedback and recognition.
2. Update staff directory
Ask employees to verify and update their contact details, emergency contacts, tax withholding forms, and beneficiary designations. Keeping this information current helps avoid issues with payroll, benefits, and compliance.
3. Back up HR and personnel data
Data security is crucial, especially for small businesses that may lack dedicated IT support.
4. Review hiring and recruitment plans
Assess what worked well in your hiring processes this year and what didn’t. Consider your staffing needs for the upcoming year and create a plan for recruiting, onboarding, and budgeting for new roles.
5. Establish HR budget and resource allocation
Plan your HR budget for the next year, including costs for recruitment, training, benefits, and employee engagement initiatives. Small businesses can benefit from proactive budgeting to avoid unexpected expenses.
6. Conduct workforce analysis
Evaluate your current team’s strengths, gaps, and areas for potential improvement. This can help you identify key talent, plan for succession, and ensure your workforce is aligned with business goals.
7. Conduct a compliance audit
Review employee classifications, labor law postings, personnel files, and policy documents to ensure everything is up to date and legally compliant. Address any gaps before the new year begins.
8. Collect employee feedback
Distribute engagement or satisfaction surveys to gather insights into what’s working and where improvements are needed. Use this feedback to guide changes in policies, communication, or workplace culture.
9. Update policies and employee handbooks
Review and revise policies to reflect legal changes or internal updates. Confirm that employees have signed the latest versions of handbooks, ethics policies, and conflict-of-interest forms.
Conclusion
Year-end activities can seem limitless, leaving HR professionals and business owners feeling overwhelmed and potentially overlooking some tasks. By preparing early, businesses can wrap up this year properly and set their organizations up for success in 2026.
© 2025 Zywave, Inc. All rights reserved.
GTM Can Help with Your Year-end HR Compliance
If you don’t have the time or staff resources to manage any or all of these checklist items, the HR consulting experts at GTM can help. We can create and implement performance reviews, conduct an HR audit to identify compliance issues, conduct a cultural review to gather unbiased employee feedback, create or update your employee handbook, and much more.
Fill out the brief form below to learn more.
