HR Year-End Checklist: 10 Key Areas to Assess

Quick look: As each year comes to a close, many business owners and human resources (HR) managers take time to review what’s working and spot areas that need improvement. This end-of-year HR checklist makes that easier by covering key tasks, from compliance updates and tax filing deadlines to setting performance objectives for the new year. Explore the highlights below, or download the full, printable version to plan with ease.

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The end of the year can be busy. Between holiday celebrations and project deadlines, your calendar fills up fast, and staff time off adds another layer to plan around.

Meanwhile, HR teams have a long list of tasks to finish so the business stays compliant and running smoothly in the year ahead.

To help support them, we’ve created an HR year-end checklist that outlines key to-dos across these 10 categories:

1. Compliance and legal updates
2. Employee records
3. Payroll
4. Employee benefits and compensation
5. Performance management
6. Financial planning
7. Strategic planning
8. Employee engagement and culture
9. Administrative tasks
10. Miscellaneous

Below, we’ve highlighted two important tasks in each area. You can also download the complete checklist to use as you work through your year-end responsibilities.

1. Compliance and legal updates

Employment laws change often, and new requirements can take effect with the start of a new year. A year-end compliance review gives you time to identify changes that may impact your business and address any necessary updates before January.

Two critical tasks:

• Review legal and regulatory changes: Check for new labor laws or industry-specific requirements that take effect in 2027.
• Acquire labor law posters: Confirm you have all required 2027 posters and display them in common areas so employees know their rights and your company’s policies.

Disclaimer: The laws mentioned in the checklist are not an exhaustive list. Please refer to your regional and industry-specific legal guidelines or consult your legal counsel for detailed and specific information.

2. Employee records

Updating and maintaining current employee records is more than just a housekeeping routine. Year-end is a good time to check that your information is current and that older records are being handled according to your company’s retention policies.

Two critical tasks:

• Update employee information: Keep personal information up to date, including contact details and emergency contacts.
• Archive old records: Store or securely dispose of records in line with your data retention policies and legal requirements.

3. Payroll

Closing the books on payroll is a year-end must. Confirming accurate payroll data and completing necessary forms helps you stay compliant, maintains financial precision, and builds employee trust. Addressing discrepancies now can help you avoid corrections and delays later.

Two critical tasks:

• Verify year-end payroll: Confirm bonuses and commissions are accurate and corrections are applied. Reconcile payroll with your accounting books, and match your W-2 totals to your quarterly Form 941 filings.
• Complete and distribute required forms:
  • Tax documents: Get W-2s and 1099s to the right people on time.
  • Agency filings: Send Form W-3 to the Social Security Administration, and Forms 941 and 940 to the IRS where applicable.

4. Employee benefits and compensation

Managing employee benefits and compensation takes a lot of coordination. A year-end review of enrollment information and planned expenses makes sure employees’ coverage is in place and your business is ready for upcoming obligations.

Two critical tasks:

• Review benefits enrollment: Confirm that benefits changes for the new year were processed correctly.
• Complete Affordable Care Act (ACA) reporting: Where applicable, provide employees with Form 1095-C and file Forms 1094-C and 1095-C with the IRS.

5. Performance management

Year-end performance management conversations give managers and employees an opportunity to reflect on the past 12 months. Pairing reviews with forward-looking goals encourages your employees’ individual growth and keeps everyone working toward the same targets.

Two critical tasks:

• Conduct year-end reviews: Evaluate each employee’s performance for the year.
• Set goals for next year: Use those conversations to shape goals and objectives for 2027.

6. Financial planning

Numbers tell a story, and reviewing your HR budget and performance data each year can help you identify where resources are being used and where adjustments may be needed.

Two critical tasks:

• Budget review and planning: See what worked in this year’s HR budget, then build the following year’s, including salaries, benefits, and any other planned expenses.
• Analyze HR metrics: Review key HR metrics, including turnover rates, hiring statistics, and employee satisfaction scores.

7. Strategic planning

Strategic planning turns year-end into a springboard for what’s coming. Before finalizing your 2027 strategy, consider whether your current staffing structure supports your goals and where you may need additional talent or leadership coverage.

Two critical tasks:

• Revisit your workforce plan: Compare current staffing levels with future hiring needs.
• Pair it with succession planning: Identify key roles and potential internal candidates through succession planning.

8. Employee engagement and culture

Employee engagement remains an important consideration heading into 2027. According to a 2026 Gallup report, just 20% of employees globally were engaged in 2025, the lowest figure since 2020. Manager engagement also declined, falling to 22% from 27% in 2024.

These findings are a good reminder to check in with your team and consider new ways to invest in your culture.

Two critical tasks:

• Plan recognition programs: Prepare recognition events, year-end awards, or bonuses.
• Get feedback from your team: Use an employee survey to see how people feel and where you can improve.

9. Administrative tasks

Your HR systems and vendor contracts deserve a regular checkup. Use the end of the year to check whether your current tools and agreements still meet your business needs.

Two critical tasks:

• Update outdated software: Make sure all HR systems are current.
• Review vendor agreements: See whether each contract still fits your needs, and renew or renegotiate as needed.

10. Miscellaneous

Some tasks, like preparing for audits and scheduling key dates, span several categories depending on how your business is structured.

Two critical tasks:

• Put important dates on the calendar: Map out 2027 deadlines, holidays, and performance review cycles.
• Get audit-ready: Organize your files ahead of any upcoming internal or external audits.

Close out 2026 with a plan for what’s next

The final stretch of the year is a time to pause and prepare. Some tasks may take only a few minutes, while others require coordination across departments or additional planning.

Working through these 10 areas can help you catch outstanding items before January and establish priorities for 2027. You don’t have to complete everything at once. Start with the deadlines and responsibilities that need immediate attention, then revisit the remaining items as your schedule allows.

Looking for some HR help in the new year?

Year-end is a lot easier to tackle when you’re not doing it alone. A professional employer organization (PEO) takes on much of your business’s administrative tasks, so you can spend more time growing it.

For example, ExtensisHR supports small and mid-sized businesses (SMBs) with a range of HR solutions, including employee benefits, payroll, compliance, and recruiting. Each client receives a dedicated HR Account Manager and HR Business Partner, while Payroll Specialists keep every pay cycle on track. Plus, our Employee Solution Center gives your employees a place to get support with their questions, with phone calls answered in under 15 seconds and 90% of cases resolved the same day.

The result is simpler HR, all year long.