As 2014 comes to a close HR also has year-end responsibilities. The most important year-end preparation revolves around compliance, benefits, and payroll administration. Ensuring that the following list is completed at the end of each year allows you to start off the new year with a clean slate and also allows you to keep track of when these tasks are completed so that you stay up-to-date:
Overall HR Compliance – In HR, compliance encompasses many things. To prepare for the new year your policies and procedures must be up-to-date. To stay compliant review the following:
- Policies and procedures – Ensure that all policies and procedures still apply and comply with changes to regulations that changed throughout the year. If you are not sure about changes specific to your state KPA can provide you with a list of changes and necessary updates.
- Complete an HR audit – Have a 3rd party conduct an HR audit to ensure that your record keeping systems are compliant.
- Audit your records – Dispose of appropriate records before the new year.
- Update your calendar – Review upcoming HR regulation and reporting deadlines for the coming year and add them to your calendar.
- Prepare for updates – Note and prepare for regulatory updates that go into effect January 1st.
Benefit Plans – Benefits compliance and reporting can be complicated, so begin this process early to make sure that you and all dealership employees are properly covered. Make certain to:
- Incorporate all new plans – Ensure that new disclosure requirements and summary plan descriptions for both retirement and health plans have been incorporated into your benefits package.
- Review deferred compensation limitations – Once you have reviewed the limits check for excess contributions to qualified plans.
- Report Taxable Imputed Income – For employees who have life insurance over $50,000, report taxable imputed income for taxable group term life insurance.
- IRS Reporting - Review and prepare for new reporting requirements including:
o You must withhold and report an additional 0.9 percent on employee wages or compensation that exceed $200,000.
o You may be required to report the value of the health insurance coverage you provided to each employee on their Form W-2.
o Effective for calendar year 2015, you must file an annual return reporting whether and what health insurance you offered your employees. This rule is optional for 2014.
o Effective for calendar year 2015, if you provide self-insured health coverage to your employees, you must file an annual return reporting certain information for each employee you cover. This rule is optional for 2014.
Payroll and Salary Administration Assessment – Make certain that you have all of the paperwork you need and relevant employee information to conclude the year:
- W4 review – Have employees review their W4s if they have changed their status during the year, or have made any other changes that would affect payroll withholding.
- Update employee information – Update records for employee addresses, demographic, and emergency information.
- Discuss salary changes – Discuss salary changes with each employee, and provide discussed compensation in writing.
- Issue year-end paychecks – These paychecks should include year-end bonuses and holiday/overtime pay.
- Adjust payroll - Any changes such as salary/wage adjustments, merit increases, and minimum wage increases must be reflected on payroll.
While the main focus of preparing for year end focuses on compliance, payroll, and benefits, there are additional optional tasks that can also be tackled to help the new year begin smoothly:
Complete an I-9 Audit – The end of the year is an ideal time to review your I-9 folder. Confirm that all of your I-9s are separated from your personnel files and kept in one binder for easy access. Check that you do not have any missing I-9s and review each I-9 for errors.
Archive Terminated Employee Folders – Whether you file them in a separate file cabinet or box them all up, the end of the year is a good time to archive your terminated employee folders. You are required to maintain the folders for 7 years, but removing them from your current employee folders will help streamline your processes. No matter where you move them, make sure that they are easily accessible if you need them.
Update Labor Law Posters – Both Federal and State labor law posters need to be checked yearly. If any of the information on them has been updated, your posters must be replaced with the current versions.
Review Job Descriptions for Personnel Files – Throughout the year, many employees may have taken on new roles or responsibilities. Check that each employee has an up-to-date and signed job description in their file to ensure that you are protected in the event of a lawsuit.
Update Employee Forms –This is also a good time to complete an employee address review, so that you have the correct mailing address for W-2s.
Review the Employee Handbook – Have any of your company policies changed? They must be noted in the handbook. Make sure that each employee acknowledges receipt of the handbook too. Completing this task annually at year end will guarantee that this task doesn’t slip through the cracks.
Depending on the size of the dealership, the time it takes to complete year-end tasks may vary. Make sure to start as early as possible so that you have adequate time to fully prepare for the year end.
Do you have a question about preparing for the year end at your dealership? Contact your Human Resource Management advocate or email [email protected].
About the Author
Kathryn Carlson is the Vice President, HR Management Products for KPA, LLC. KPA provides loss control, risk management, information security and HR management software and professional services for over 5,100 dealerships, collision centers and service companies. Kathryn has over 27 years of Human Resource Management, HRIS product management, and product marketing experience and is a certified HR professional (SPHR). Kathryn’s focus at KPA is developing and managing HR software and HR compliance programs that improve efficiency, reduce risk, and ensure compliance for companies ranging from small businesses to international corporations.
KPA is a business services provider for more than 5,100 automotive, truck and equipment dealerships, and service companies. KPA provides Environmental Health and Safety (EHS) and Human Resource (HR) Management software and consulting services. KPA’s solutions have been embraced by leading auto dealers, including eight of the 10 largest dealer groups in the United States, and endorsed by 26 dealer associations from around the country. KPA joined the Inc. 500/5000 list of fastest growing companies in 2012. To learn more, visit www.kpaonline.com or call 866.356.1735.