An HR Year in Review: Key Updates in 2025

The unpredictability of 2025 has been an uphill trek for HR teams across the U.S. This year brought substantive employment compliance changes to policies that have been in force for decades. 

This article breaks down the key issues we saw in 2025 including: 

• Federal mandates were upended in the beginning of 2025, but requirements for disability & veteran and EEO reporting still stand.
• States enacted new pay transparency laws and higher overtime thresholds.
• DEI faced major scrutiny, pushing employers to update and refine programs.
• AI exploded into HR, adding new compliance rules and hiring challenges
• Immigration enforcement surged, making "airtight" Form I-9 processes essential.

With federal deregulation, new state mandates, changing expectations around DEI, and the seemingly overnight explosion of AI, HR teams have been working through one of the most transformative years in recent memory. 

Just in the first eight months of 2025, more than 180 executive orders hit the books, some rescinding long-standing requirements, others restructuring compliance in ways that beg the question, "So what still applies?"   

Let’s walk through the biggest developments of 2025, what changed, what remains the same, and what HR should be preparing for next. 

No Longer Required: Certain Federal Contractor Obligations

For federal contractors, one of the biggest shakeups came with the removal of several long-standing reporting and program requirements, including: 

• Affirmative Action Programs (AAPs) for minorities and women are no longer required.
• The annual pay equity report requirement was rescinded.
• Certain federal labor law postings, such as the Pay Transparency Non-Discrimination Notice and the Federal Contractor Minimum Wage Notice, are no longer necessary.

Some companies are struggling with the question: If these programs aren’t required, should we continue them in some way, shape or form? The answer for many is still yes, with some caveats, because eliminating them could raise questions about equity commitments, internal accountability, and risk exposure under other federal and state laws. 

Still Required: Core Compliance Isn't Going Anywhere

Despite rumors and misunderstandings earlier this year, several requirements are still very much intact and required. HR must continue to complete: 

• Section 503 compliance for individuals with disabilities.
• VEVRAA compliance for protected veterans, with updated hiring benchmarks.
• EEO-1 Component 1 Reports.
• VETS-4212 Reports.

In other words, while minority and women AAPs are no longer required, compliance requirements and AAPs for individuals with disabilities and protected veterans remain unchanged.

Upcoming Requirement: Anti-Discrimination Certification

One of the most notable upcoming developments is a new federal certification confirming that contractors comply with all anti-discrimination laws. The fine details are still being developed, but many predict this will mirror existing government attestations, similar to the annual OFCCP certification we’ve seen in the past.  

It is critical HR is prepared for this certification because falsely certifying could put you at risk for a False Claims Act violation which can rack up significant penalties or even potential jailtime in egregious cases.  

HR should expect increased documentation, recordkeeping, and policy validation efforts as agencies roll out more guidance. Stay tuned. 

DEI in the Spotlight

If 2020–2023 were the years DEI programs expanded, then 2025 was the year they were put directly under the spotlight and examined with increased scrutiny.   

Executive Order 14173 prompted employers to reevaluate their diversity, equity, and inclusion efforts. The objective was not to eliminate them, but to help ensure programs do not violate federal anti-discrimination requirements.  

The pressure is particularly intense for federal contractors. Companies may face steep consequences under the False Claims Act if DEI initiatives are found to violate federal requirements, and you have certified they do not. The bottom line? DEI isn’t disappearing. It’s changing and becoming more data-driven and evidence-based. 

New Pay Transparency Laws

Pay transparency laws continued to be a focus across the country in 2025. This year alone, new pay transparency laws were enacted in several states, including: 

• Massachusetts 
• New Jersey 
• Minnesota 
• Vermont 
• Illinois 

Note that each state law comes with its own nuances, such as salary range disclosure rules, recordkeeping requirements, job advertisement expectations, and penalties for noncompliance.  Because federal pay equity reporting was rescinded, states may increase their own oversight. For multi-state employers, pay transparency laws have become one of the biggest compliance “puzzles” of the year. OutSolve’s State Pay Transparency Law Guide can help eliminate some of the confusion. 

Overtime Exemptions

Speaking of compensation, five states will have minimum salary requirements for overtime exemption that will increase on January 1, 2026, and will exceed the federal level of $684 per week. Those states are California, Colorado, Maine, New York and Washington. Federal law sets a baseline, but states with higher minimums create higher and separate thresholds. HR needs to monitor these thresholds to avoid misclassifying employees, which can lead to potential penalties.  

AI Meets HR

If you thought HR tech was complicated before, then you haven’t seen anything yet! Welcome to the new era of AI regulation. HR now needs to juggle things like new AI laws, requirements around algorithmic transparency and bias audits, managing the rise of AI-generated or AI-assisted “fake” candidates, and even monitoring vendor tools to ensure  they’re compliant, and whether vendors will certify that in writing. 

The White House also issued a new presidential action, Eliminating State Law Obstruction of National Artificial Intelligence Policy, which reinforces federal authority over AI governance and limits conflicting state requirements. For HR teams, this signals that AI oversight will continue to centralize at the federal level and that employers should prepare for national standards that affect how recruitment, monitoring tools and automated systems can be used. 

Recruiting teams are feeling the brunt of this new pressure. From verifying identities to avoiding screened candidates being unfairly excluded by biased algorithms, AI has added a level of complexity that wasn’t even on HR’s radar just a few years ago. 

Heightened Immigration Enforcement & Increased Importance of Form I-9 Compliance

Another major shift this year happened with increased immigration enforcement and compliance. There are now more frequent ICE audits and workplace raids, targeted enforcement in specific industries such as manufacturing, hospitality, and agriculture, and a heightened focus on states with historically high rates of unauthorized workers. 

This has placed tremendous pressure on HR to tighten I-9 verification processes, conduct internal audits, review visa sponsorship considerations, and help ensure that onboarding processes meet all federal requirements. Employing one undocumented employee could mean fines in the thousands.