HR Compliance Mistakes Are Expensive: Here’s How OutSolve Keeps You Covered

HR compliance mistakes are one of the biggest and most avoidable drains on your budget. A single error—whether a missing Form I-9, an outdated poster, or a misstep in pay transparency—can lead to fines, lawsuits, reputational damage, or even lost contracts. Enforcement agencies are stepping up audits across industries, and penalties are higher than ever. 

One Denver cleaning company was fined more than $6 million in 2025 after ICE found repeated violations of knowingly hiring and employing at least 87 unauthorized workers.  It was one of the largest enforcement actions in recent years—and a warning to any employer that underestimates Form I-9 compliance. 

The message to leaders is clear: Every HR process must be accurate, consistent, and audit ready. Along with following best practices, you can reduce HR compliance risk by outsourcing to qualified providers such as OutSolve. 

Stay Compliant with Pay Transparency in Hiring 

In 2025, more than a dozen states—including California, New York, Washington, Massachusetts, and Minnesota—require salary ranges in job postings, promotions, or transfers. Additionally, many states require disclosure of benefits or prohibit salary-history questions during job interviews. With each state enforcing its own rules, compliance has quickly become one of the most pressing challenges for HR professionals, especially those operating in multiple states. 

The regulatory requirements extend throughout the hiring process. Job postings that say “salary negotiable” without a stated range can trigger penalties, while many states ban interview questions such as “What was your last salary?” Each noncompliant posting or misstep can be treated as a separate violation of employment law. 

Employers operating in multiple jurisdictions must carefully track pay transparency laws by state.  Inconsistent processes or untrained interviewers can create systemic risk across recruiting teams. Additionally, failing to include salary ranges in job postings can lead to job seeker disregard—candidates are increasingly bypassing listings that lack pay transparency in favor of those that clearly state compensation, reducing your reach to top talent. 

 OutSolve reduces this exposure by offering pay transparency consulting that includes standardized job description templates, compliance training for hiring managers, and expert guidance on multistate requirements. By helping employers align with federal, state, and local laws, OutSolve supports consistent, legally compliant job postings and interview practices across your organization. 

Pay Transparency Penalties by State (2025) 

State	Penalty Per Violation	Who it Effects
California	$100–$10,000	Employers based in California with 15+ employees.  Employers based outside California that have at least 1 employee working in California.
Connecticut	Civil action for compensatory and punitive damages (plus costs)	Employers with 1 or more employees in Connecticut
Colorado	$500-$10,000	Employers with operations in Colorado or with employees working in the state
Hawaii	Civil action for compensatory and punitive damages (plus costs)	Employers with 50 or more employees
Illinois	$500-$10,000	Employers with at least 15 employees
Maryland	$300 (2nd), $600 (subsequent); warning for first offense	All public and private employers in Maryland
Massachusetts	$500-$25,000 (severe/repeat); warning for first offense	Employers with 25 or more employees
Minnesota	Penalties unspecified	Employers with 30 or more employees
Nevada	Potential civil action and fines up to $5,000	All employers
New Jersey	$300 (1st), $600 for subsequent violations	Employers with at least 10 employees over 20 calendar weeks
New York City	Up to $250,000 (severe breaches); No fine if resolved in 30 days	Employers with 4 or more employees or 1 or more domestic workers
New York State	$1,000 (1st), $2,000 (2nd), $3,000 (subsequent)	Employers with 4 or more employees
Rhode Island	$1,000–$5,000	All state employers
Vermont	Penalties unspecified	Employers with at least 5 employees physically located in Vermont or with remote roles tied to a Vermont based office
Washington, D.C.	$1,000 (1st), $5000 (2nd), up to $20,000 (repeat offenses)	All employers (except federal and D.C.)
Washington State	$100–$5,000 (1st), Up to $5000 with damages and legal fees (repeat)	Employers with 15 or more employees

 

Onboarding Done Right: I-9 Compliance 

The Form I-9 may look simple, but the risks of getting it wrong are severe. Employers must verify the identity and work authorization of every employee hired in the U.S., and they must complete and retain I-9 forms for every current employee. Additionally, there are strict retention timelines for how long employers must keep Form I-9s for terminated employees on file. Remote verification adds complexity, as HR managers can struggle with Section 2 completion when employees work outside of central offices. 

The penalties are steep. Paperwork violations alone range from $288 to $2,861 per form, while knowingly hiring or continuing to employ unauthorized workers can cost up to $28,619 per employee. In 2025, ICE increased audits nationwide, with some employers facing millions of dollars in fines after widespread violations were alleged . As outlined in the penalties for Form I-9 violations,  enforcement agencies calculate penalties on a per-form, per-employee basis. That means a small mistake like a missing signature can be multiplied across dozens or even hundreds of employees, quickly escalating into six- or seven-figure fines. 

OutSolve’s I-9 employment eligibility verification solutions includes built-in logic to prevent errors, supports E-Verify case creation and tentative nonconfirmation escalation, and enables secure remote Section 2 completion and verification with trained I-9 authorized representatives. Status dashboards and proactive monitoring help organizations meet compliance requirements by outsourcing the complexity of I-9 management, ensuring accuracy across every new hire. 

Government Reporting Without the Guesswork 

Federal and state reporting is one of the most complex areas of HR compliance. Private employers with 100+ employees must file annual EEO-1 reports, as must federal contractors with 50+ employees and contracts of $50,000+.  

Contractors with contracts of $150,000+ must file VETS-4212 annually, and those with 50+ employees and contracts of $50,000+ are further covered by Section 503 and VEVRAA, which require affirmative action plans and outreach to individuals with disabilities and protected veterans. 

Noncompliance can quickly shut down opportunities for contractors. If the government notices an error, debarment from contracts is one risk. Once debarment is proposed, contractors may be ineligible for new federal contracts or grants. The Federal Acquisition Regulation (FAR) blocks new awards, renewals, or extensions unless an agency head finds a compelling need. With the Office of Federal Contract Compliance Programs (OFCCP) winding down and states cross-checking pay data for inconsistencies, loss of eligibility for future contracts is a real risk. 

However, manual tracking of compliance obligations is a tough ask for multi-state employers. OutSolve streamlines federal reporting requirements by preparing and filing EEO-1 and VETS-4212 reports, and by developing and maintaining compliant Affirmative Action Plans (AAPs) under Section 503 and VEVRAA. OutSolve keeps deadlines on track, records accurate, and programs aligned with changing federal and state rules. 

Who Must File? 

Don’t Overlook Labor Law Posters & Workplace Notices 

Labor law posters may seem minor, but failing to keep them current is a costly compliance gap. Employers must display the latest federal, state, and local notices, including: wage and hour laws, the Family and Medical Leave Act (FMLA), and regulations issued by the Occupational Safety and Health Administration (OSHA) and the Equal Employment Opportunity Commission (EEOC). Employers must also provide digital labor law posters for remote staff. 

Requirements are not one-size-fits-all. Certain industries, such as healthcare, construction, and transportation have additional, industry-specific postings. Federal contractors and public agencies must also meet unique federal requirements. Many jurisdictions require postings in the primary languages spoken by employees, most commonly English and Spanish, and sometimes additional languages based on workforce demographics. 

Common mistakes include outdated posters, missing state- or city-specific notices, and failing to make postings accessible to remote and hybrid workers.  

Penalties vary: $216 per FMLA violation, $680 under EEOC rules, as much as over $26,000 under the Employer Polygraph Protection Act (EPPA), and up to $16,550 per OSHA poster. Many states also add $100–$1,000 fines per poster, per location. For multi-site employers, these costs escalate quickly. See our guide to multi-state labor law posters to learn more.  

HR compliance solutions can help solve these compliance challenges. OutSolve’s labor law poster subscription monitors federal, state, and local changes, then delivers updated print and digital posters tailored to each worksite, industry, and required language. The service ensures remote employees receive current notices electronically and keeps postings accessible and up to date. With our compliance guarantee, required replacements are issued promptly, reducing the risk of fines and disruptions.

The OutSolve Advantage 

Managing HR compliance across pay transparency, I-9 verification, state and federal reporting, and labor law posters is challenging, especially for multi-state employers facing shifting rules and rising penalties. OutSolve provides integrated, expert-led HR compliance solutions that simplify regulatory compliance.  

Think mobile-friendly I-9s with remote Section 2 handled by trained agents and E-Verify case management, a single secure data pull for full-service EEO-1 and VETS-4212 filing, practitioner-written AAPs under Section 503 and VEVRAA, and turnkey preparation and submission of pay data reports. 

By combining technology with hands-on expertise, we help employers minimize risk, meet deadlines, and stay audit ready. The result is peace of mind, with HR leaders free to focus on people and strategy rather than regulations. 

Don’t Pay the Price for Compliance Gaps 

The cost of compliance mistakes is measured not only in fines but also in lost contracts, lawsuits, and damaged reputations. Reduce HR compliance risk by outsourcing to trusted compliance experts who can strengthen your processes, safeguard your business, and help you move forward with confidence. 

Speak to an OutSolve compliance expert today to learn how our HR compliance solutions can help your organization stay protected. 

Beth Montgomery

Beth has over two decades experience in HR compliance consulting and non-discrimination planning. She currently serves as Senior Director of Operations at OutSolve. Beth combines her experience as a hands-on federal contractor with her knowledge of regulatory requirements to provide support to her clients in designing and monitoring their non-discrimination programs, providing guidance on Form I-9 compliance, and conducting proactive Form I-9 audits. Beth also partners with Talent Acquisition Teams to help maximize the impact of strategic disposition reasons and advises how to monitor these results in combination with recruitment sources to get the best ROI. Prior to joining OutSolve, Beth was a Director of Affirmative Action for a Fortune 300 federal contractor where she managed a non-discrimination program for 100,000+ employees and successfully coordinated hundreds of audits. Beth is a graduate of the University of Louisville.