HR compliance checklist 2025 | Sage Advice UK

Whatever the size of your company, you have any number of contracts, wage laws, workplace policies, and data protection rules to keep track of.

To bring order to this web of requirements there’s nothing better than a good checklist.

It’s a great tool for spotting gaps that could develop into serious problems if they go unnoticed.

Use this article, and our HR compliance checklist, to stay organised and keep your business on the right side of the law.

Here’s what we’ll cover:

What is HR compliance?

HR compliance means making sure your staff management practices stay up to date with the law and follow it correctly.

Compliance in HR touches on a wide range of legal areas—employment contracts, minimum wage, leave entitlements, fair hiring, safe working conditions, and more.

In the UK, HR compliance is shaped by key legislation including the Employment Rights Act 1996, the Working Time Regulations 1998 (WTR 1998), Equality Act 2010, and the Data Protection Act 2018.

Compliance also covers data protection rules like the UK version of GDPR.

You’re responsible for keeping staff information secure, and for being transparent about how it’s used.

If you track absences, performance, or payroll details, those records must meet privacy standards.

Health and safety is part of human resources compliance as well.

You need to assess risks and provide a safe work environment, whether your team is on-site or remote.

On top of legal requirements, you’ll also want to align internal HR policies—like grievance procedures and staff handbooks—with employment law and best practices.

This helps ensure fair treatment for all employees.

Why HR compliance matters more than ever

With the world becoming more digital and employees growing more informed, governments have introduced new rules to protect rights and regulate workplaces.

That includes employment law, which continues to evolve with updated wage thresholds, right-to-work rules, and workplace safety standards.

At the same time, expectations around diversity, data security, and ethical conduct are higher than ever.

The ever-changing rules and responsibilities mean HR compliance has become more complex in 2025, especially for small businesses and startups in the UK.

Aside from presenting a legal risk, falling short on compliance can disrupt operations, damage morale, and harm your reputation.

A single error in hiring, pay, or employee records can trigger an audit—or even a tribunal.

One safeguard in this confusing landscape is to use an HR compliance checklist so you avoid oversights and stay consistent.

Who is responsible for HR compliance?

Big companies tend to have professional HR teams and it’s part of their job to maintain compliance.

But if you’re running a small business, people from various departments may have to pitch in and share the load.

Founders, managers, and even office assistants have been known to juggle HR tasks alongside other duties—but this can lead to confusion over who handles what.

Without clear ownership, key steps can fall through the cracks.

If one person is managing contracts and tracking working hours, someone else should take charge of responding to staff concerns and updating policies, for example.

It depends on each team member’s workload and skillset.

The most important thing is clarity and structure around HR compliance roles and responsibilities.

When assigning HR duties make sure each person understands what’s expected and what resources they can use—like compliance checklists or access to compliant HR software.

HR compliance checklist for employers

Here we break down the checklist into seven key areas to focus on:

1. Employment documentation

When you bring new people onboard, setting clear expectations will keep many other processes on track throughout the employee lifecycle. Chief among these early-stage records and formalities are:

• Employment contracts. These should outline job role, pay, and working hours at the very least.
• Right to work checks. Verify that every new hire is legally allowed to work in the UK.
• Job descriptions and offer letters. Use these to confirm duties, reporting hierarchy, and pay terms before you sign contracts.
• Staff handbooks and HR policies. Outline company rules, benefits, and how you handle issues like grievances or misconduct.

2. HR reporting and recordkeeping

Good recordkeeping doesn’t stop with the onboarding process. There are plenty of other instances where records need to be updated as employees progress through their roles.

• Absence logs. Track sickness, holidays, and unpaid leave to spot trends and meet legal requirements. This should include unauthorised absences.
• Performance documentation. Keep notes from appraisals and improvement plans to support decisions around promotion, guidance or dismissal.
• Training records. Log completed skills training, onboarding sessions, and refresher courses.
• Safety records. Maintain up-to-date logs of health and safety checks, risk assessments, and incident reports.

3. Payroll and benefits compliance

Among the primary considerations for applicants and ongoing employees alike.

Mistakes in payroll compliance can lead to penalties, not to mention broken trust.

• PAYE setup. PAYE rules require registration with the tax office HMRC and deduct tax and National Insurance contibutions correctly.
• National minimum wage. Check that pay rates meet or exceed legal thresholds for each age group in your roster.
• Statutory sick and parental pay. Ensure your system is set up to calculate the correct leave and pay in cases of sickness, maternity, paternity, and shared parental leave.
• Pension auto-enrolment: Enrol eligible employees into a workplace pension and ensure that your payroll software deducts the required contributions.

4. GDPR and data protection

Another way to build trust is to let employees know you adhere to these legal duties.

• Employee privacy policy. Explain how you collect, use, and store personal data, including descriptions of what data is included.
• Data processing records. Keep a log of the data you hold, why you hold it, how it’s processed and where it’s stored.
• Secure file storage. Use encrypted systems or password-protected files for storing sensitive information.
• Subject Access Requests (SARs). Know how to respond when an employee requests access to their personal data.

5. Workplace policies

The whole point of policies is consistency and transparency, helping to prevent misunderstandings and clarifying employees’ rights.

Your policies should cover all nine protected characteristics under the Equality Act 2010, including age, disability, race, and sexual orientation.

Pay special attention to:

• Grievance and disciplinary policies. Set out fair procedures for dealing with complaints or misconduct, with ample opportunities for each party to make their case.
• Anti-discrimination and equal opportunity statements. Show your commitment to fair treatment and inclusive hiring.
• Absence and flexible working policies. Explain how leave is handled and outline the process staff should follow for requesting flexible or remote work.

6. Health and safety compliance

Any shared workspace or use of equipment naturally introduces risks—whether from human error, miscommunication, or something breaking down.

• Risk assessments. Identify hazards in the work environment and assess how to manage them.
• Health and safety lead. Appoint someone to take responsibility, even in a small team.
• Safety training. Give staff the right training to handle equipment, emergencies, and daily risks.
• Fire drills: Run regular drills so your team knows what to do in an emergency.
• First aid kits: Make sure kits are available, stocked, and easy to find in every location.

7. Remote and hybrid compliance considerations

All these legal responsibilities apply equally for staff who work remotely or in the field—but that can make it harder to manage.

When team members work in different locations you lose visibility over how, where, and when work is being done.

Here are four areas where you need to pay particular attention:

Health & safety

You’re still responsible for your team’s working conditions, even at home.

That includes making sure they have a safe setup, take proper breaks, and understand how to use equipment safely.

You can’t look over their shoulder, so you’ll need to rely on home workstation assessments, regular check-ins, and clear health and safety training.

Employment eligibility

Right-to-work checks are required for new hires no matter where they work.

But this is solved by digital checks, perhaps involving video calls, the use of scanned documents, or ID verification tools.

However, be sure to follow approved procedures—get it wrong and you could face penalties for employing someone illegally.

Tech systems

The good news is that many corporate systems now run on cloud-based platforms with secure login functionality.

It’s common for hybrid or remote staff to access systems from home networks or personal devices.

The training for data handling and rules on file sharing or storage are often the same for in-house staff.

Logging hours

Finally, just because someone’s not in the office doesn’t mean Working Time Regulations don’t apply.

Use tools to log hours and help staff manage their time without slipping into overwork.

How to stay on top of HR compliance all year round

Laws can shift from one year to the next. People join and leave your organisation. Policies often need refreshing.

To avoid slipping out of step, there are ways to build HR compliance into your ongoing routines:

• Set a regular schedule for reviews. A quarterly HR audit can help you spot issues early—before they become problems. Use this time to review contracts, check training logs, and revisit policy documents. If any laws have changed or staff needs have shifted, this is when you can catch it.
• Monitor employment law updates. Modern HR software can keep you up to date with the latest changes to employment law, health and safety regulations through automatic updates, dedicated HR advice resources and direct access to HR experts. If you work with an accountant or legal advisor, ask if they offer alerts too.
• Use quality HR software. Good systems don’t just store documents—they track expiry dates, send reminders, and help you report on key compliance areas automatically.

How Sage can help you stay compliant

Managing compliance on your own can be time-consuming and stressful, but a lot of the administrative burden can be automated.

HR software helps you deal more efficiently with admin and adhere to legal obligations. It offers a centralised and secure platform for managing employee records, which is a crucial step for data protection.

You can store and manage documents like contracts, job offers, and right-to-work proof in one secure location.

Customisable templates also let you standardise important documentation and templates across your organisation, ensuring a consistent and compliant approach.

The platform also streamlines the distribution of policies, so all your colleagues receive the latest version, and you can keep a record of who has seen and acknowledged it.

HR tools such as Sage HR also helps you stay on top of things with automated alerts for important deadlines, such as contract renewals, training deadlines, or policy updates.

This, and centralisation of tasks, reduces the risk of human error and helps your business maintain HR compliance.

Final thoughts

Staying legally compliant in HR matters can be a minefield, particularly as the legislative landscape is constantly changing.

However, with a proactive strategy—including regular audits, continuous learning, and the use of smart HR technology—you can easily take charge of the admin required.

With compliance taken care of, and built into your everyday processes, you’ll spend less time chasing paperwork and more time focusing on your people.

Get expert advice and guidance

Talk to a CIPD-qualified HR consultant, who can explain the law updates and translate what these changes mean specifically to your business.

Solutions like Sage HR Advice provide SMBs access to cost-effective, reliable advice to keep their businesses compliant.