Texas Small Business Compliance & HR Checklist (2023–2027)

Your Step-by-Step Planning Guide

 

Welcome to this comprehensive guide tailored for Texas small business owners, especially those with 1 to 150 employees. As we navigate changing state and federal laws related to HR, benefits, insurance, and reporting from 2023 to 2027, this resource will help you stay compliant and build a successful work environment. We’ve broken down each year into actionable steps with clear, simple explanations to make it easy for you to implement the needed changes.

 

2023 Action Items

1. HR & Compliance
   • Ensure all city-specific employment policies, such as sick leave, are removed due to HB 2127, promoting uniformity in labor practices.
   • Update grooming policies to embrace natural hairstyles in accordance with the CROWN Act (HB 567), fostering a more inclusive workplace.
   • Carefully review job responsibilities for minors, as HB 2459 introduces higher penalties for non-compliance.
   • Start accommodating pregnancy as a protected condition as mandated by the PWFA (federal law), reflecting your commitment to support all employees.
   • Provide private space and adequate break time for nursing mothers as required by the PUMP Act (federal), ensuring comfort and compliance.
2. Insurance & Benefits
   • Verify that your health plan aligns with the new 12-month contraceptive supply rule established in HB 916, enhancing your benefits offerings.
3. Reporting & Administration
   • Update your breach notification protocols to ensure the Attorney General is notified within 30 days if a data breach affects 250 or more Texans, as outlined in SB 768.
   • If your revenue is $2.47 million or less, you can discontinue franchise tax returns; however, don’t forget to file the Public Information Report as required by SB 3.

2024 Action Items

4. HR & Compliance
   • Remove any COVID-19 vaccine mandates from hiring policies in accordance with SB 7, reflecting the evolving landscape of workplace safety.
   • By March, be sure to post the Workplace Violence Hotline notice (with a poster from the Texas Workforce Commission) in compliance with HB 915.
   • All I-9 forms completed remotely during COVID require in-person follow-ups by August 30, 2023.
5. Insurance & Benefits
   • Assess the optional Paid Family Leave Insurance available under HB 1996 to consider adding value to your employee benefits.
   • Prepare for the removal of pre-deductible telehealth services in 2025 if you offer an HSA/HDHP plan.
6. Administration & Taxes
   • Keep an eye out for 1099-K forms from platforms such as PayPal or Venmo for payments exceeding $600, following IRS changes.
   • If using E-Verify, familiarize yourself with the new remote I-9 inspection process being rolled out.

2025 Action Items

7. HR & Compliance
   • Be prepared for virtual workers’ compensation hearings beginning in June as detailed in HB 2488.
   • Monitor hours for part-time staff; those working 500+ hours per year for two consecutive years will be eligible for 401(k) benefits under SECURE 2.0.
8. Insurance & Benefits
   • Implement auto-enrollment for any new 401(k) plans created after January 1, 2025, as per SECURE 2.0 rules.
   • Enroll qualifying part-time employees into the 401(k) plan starting January 1, 2025, adhering to the two-year eligibility requirement.
9. Administration & Privacy
   • If your business handles consumer personal data, verify whether the TDPSA privacy law pertains to you (most likely exempt if you are a small business).
   • Ignore the FinCEN BOI report requirement if your company is U.S.-formed; this rule will be paused in 2025.

2026 Action Items

10. Workers’ Compensation & Insurance
    • Get ready for a potential surcharge on your workers’ compensation policy under SB 1455, as there may be a slight increase in premiums.
    • Confirm that your insurance provider notifies you of any policy declinations as specified in HB 2067.
11. Retirement Plans
    • Ensure that employees earning over $145,000 who make age 50+ catch-up contributions adhere to Roth rules under SECURE 2.0.
    • Confirm by January 1, 2026, that your 401(k) plan enables Roth contributions.
12. Lending & Applications
    • Prepare to supply demographic information when applying for loans, as new CFPB rules will start phasing in on July 1, 2026.

2027 Action Items

13. Retirement Plans
    • Inform your employees about the new Saver’s Match program, which offers a 50% match up to $1,000 from the IRS under SECURE 2.0.
14. Lending & Applications
    • Brace yourself for ongoing demographic data reporting requirements for loan applications (CFPB Tier 2: January 1, Tier 3: October 1).

Planning Tips

1. Conduct annual training for managers on updated HR rules related to pregnancy, hairstyle, and other accommodations.
2. Review your employee handbook each year with your HR or benefits advisor to ensure it stays current.
3. Update your website and notifications if you handle personal data or offer new benefits.
4. Communicate any changes, like the new 401(k) Roth rules and benefits updates, to your team.
5. Work closely with your vendors—401(k) providers, insurance brokers, and payroll systems—to ensure a smooth transition and compliance with retirement and benefits updates.

This checklist is here to help you minimize risk, avert penalties, and cultivate a positive workplace culture while staying compliant with relevant Texas and federal laws. Embracing these changes not only enhances your operations but also supports a great working environment for you and your valued employees compliant with Texas and federal law.

 

Helpful Resources for Texas Small Business Owners

• Governor’s Small Business Handbook – The most comprehensive statewide guide for small business planning, compliance, and resources (updated March 2025).
  https://content.govdelivery.com/accounts/TXGOV/bulletins/3d1ca83
• Starting a Business in Texas (Texas.gov) – Official seven-step roadmap from business planning to licenses and taxes.
  https://www.texas.gov/starting-business-texas/
• Texas Secretary of State – Business Resources – Guidance on filings, entity registration, and trademark basics.
  https://www.sos.state.tx.us/corp/do-business.shtml
• Business Planning Support – Governor’s Office & SCORE/SBDC – Templates and mentor-led assistance in crafting business plans.
  https://gov.texas.gov/business/page/write-a-business-plan
• Texas State SBDC – Startup 101 Tools – On-demand workshops and resources for essential business startup topics.
  https://sbdc.mccoy.txst.edu/Starting-A-Business.html