HR Compliance Audit

Attorneys generally qualify under the learned-professional exemption (29 CFR §541.304). Confirm each licensed attorney's primary duty is the practice of law and that they are paid on a salary basis above the threshold. Contract attorneys paid hourly through a staffing agency are a common gray area — flag them for separate review.

Paralegals are presumptively non-exempt under DOL Opinion FLSA2005-54 — even those with advanced degrees or specialized certifications. If any paralegal is currently classified as exempt, document the specific duties supporting the classification or flag for reclassification.

Calculate back-pay exposure for any misclassified position over the past two years (three under willful violation) and bring options to the managing partner. Reclassification carries downstream effects on benefits eligibility, overtime budgeting, and time-tracking workflows.

Apply the IRS three-prong control test (behavioral, financial, relationship) to every contract attorney and per-diem reviewer. A 1099 contractor who works exclusively for the firm, uses firm equipment, and is supervised on day-to-day work is almost certainly an employee under federal and many state tests (CA AB-5).

Update job descriptions for attorney, paralegal, legal assistant, billing clerk, intake specialist, and administrator roles. Each description should map to the FLSA duties-test outcome from the prior steps and reflect current responsibilities — not language copied from five years ago.

Pull every active employee's I-9. Verify Section 1 was completed on day one, Section 2 within three business days of hire, and that List A or List B+C documents are recorded. Correct errors with a dated note in a different ink color — never backdate. ICE penalties run $281–$2,789 per form for paperwork violations.

ADA requires medical records (FMLA paperwork, accommodation requests, workers' comp) be kept separate from the general personnel file. I-9s and any harassment-investigation files belong in their own folders as well — co-mingling these with the personnel file is a routine audit finding.

Pull current bar status for each licensed attorney from the state bar website and confirm CLE compliance period and ethics-hour requirement is on track. A suspended attorney still seeing clients is a malpractice and Rule 5.5 problem; the firm administrator catches this before the bar does.

Cross-check the signed acknowledgment list against the active-employee roster. Anyone hired since the last handbook update needs the current version on file with a signature dated after the revision date — older signatures don't cover new policies.

Check federal, state, and any city or county minimum wage. Local rates often exceed state (Seattle, NYC, San Francisco). New rates typically take effect January 1 or July 1 — confirm payroll reflects the current rate for every non-exempt staff member in every jurisdiction the firm employs in.

Pull twelve months of timesheets for every non-exempt staff member. Confirm overtime was paid at 1.5x for hours over 40 in a workweek (over 8 in a day in CA). Trial-prep weeks are the high-risk windows — paralegals working 60-hour weeks during trial without recorded overtime is the textbook claim.

Replace expired posters in the breakroom or other conspicuous space. Required: federal FLSA, EEOC, FMLA (if 50+ employees), USERRA, plus state-specific notices. For remote employees, post electronically in the firm intranet or HRIS.

State definitions of harassment and protected classes change frequently. NY, CA, IL, CT, and several others mandate specific policy language and training cadence. Confirm the policy lists all current protected classes for every state where the firm has employees.

NY and CA require annual training; IL and CT every two years. Track completion per attorney and staff member with date and certificate. Don't forget contract attorneys and per-diem staff if they meet the state's threshold.

The written process should name at least two intake channels (so an employee with a complaint about their direct supervisor has an alternative), define timelines for acknowledgment and investigation, and address retaliation protection. Partner-level allegations need a defined external-counsel referral path.

Place a test call to the vendor (NAVEX EthicsPoint, Lighthouse, or similar) and verify the report routes to the designated firm contact and a backup. Confirm the number is published in the handbook, on the intranet, and on the breakroom poster.

Use the rolling 12-month look-back method consistently — switching methods mid-year creates eligibility gaps and is a common audit finding. Confirm the FMLA poster, eligibility notice, and rights-and-responsibilities notice are all current.

If the firm has 50+ FTEs, the lowest-cost employee-only plan must come in at or below the IRS affordability threshold (8.39% of household income for 2024). Confirm 1095-C codes match actual offers — incorrect Line 14/16 codes are the most common ACA penalty trigger.

State paid-sick-leave laws (CA, CO, NY, NJ, MA, etc.) set minimum accrual rates and carryover requirements. Confirm the payroll system's accrual matches the most generous applicable rule. Unused PTO payout at termination is a state-by-state variable — confirm policy language matches current law for every state the firm operates in.

Several states (NY, NJ, CA, MA, CT, OR, WA, CO) run paid family leave programs with their own eligibility and benefit rules — confirm the firm's policy interacts cleanly with the state benefit. Bereavement leave is mandated in CA and IL; document the qualifying relationships and duration.

Even office-based law firms with 11+ employees in non-exempt SIC codes maintain the 300 log. The 300A annual summary posts February 1 through April 30. Recordable injuries at law firms are usually slip-and-fall, repetitive strain, or commute-related events that meet the work-relatedness test.

Walk every floor: blocked exits, expired fire extinguishers, exposed cords, overloaded power strips under desks, ergonomic risks at workstations. Records rooms with overstacked file boxes are the most common finding at law firms.

Assign each finding an owner and a target close date. Document remediation with a dated photo or work-order receipt and re-inspect. Open findings carrying over to the next annual audit are a red flag if OSHA arrives on an unrelated complaint.

Confirm the EAP names current floor wardens, the assembly point, and the call tree. Run a tabletop or live evacuation drill annually and document attendance. Update for any office moves or significant headcount changes since last year.