What does a California HR compliance check-up cover for a 10-to-50-person company?

Why is 10 to 50 employees the risk zone?

Between 10 and 50 employees, a company crosses most of California’s employment thresholds while HR is still a side job for a founder, an office manager or an operations lead. At 5 employees, the full FEHA discrimination rules, CFRA leave and harassment prevention training begin. At 15, pay scales must appear in every job posting. The headcount hub lists every line. A check-up confirms that your paperwork crossed each line when your headcount did.

1. Worker classification

Every contractor gets tested against the ABC test, and every salaried employee gets tested against the exempt duties and salary rules. Misclassification is the most expensive single finding in most small-company reviews, because it reaches back into overtime, meal and rest breaks, expense reimbursement and wage statements at once.

2. Pay practices and wage statements

• Itemized wage statements with every item Labor Code 226 requires, including the legal name and address of the employer.
• Daily overtime over eight hours, not only weekly overtime.
• Meal and rest break scheduling and premium pay when a break is missed.
• Final pay timing on termination and resignation.
• Paid sick leave accrual and the balance shown on each statement.

Two pay practices carry the largest penalties: final pay on time and meal and rest break premiums, which PAGA can multiply across a whole staff.

3. Postings and pay scales

At 15 employees, every job posting needs a good-faith pay scale, and you must keep title and wage history records. Under 15, you still owe the range to any applicant who asks. Here is what small employers owe. The check-up also confirms the required state and federal workplace notices are posted where employees see them, including remote employees.

4. Leave policies

The handbook should match current law: CFRA, pregnancy disability leave, bereavement leave, reproductive loss leave, paid sick leave and any Bay Area city rules that go further (how the main three fit together). Outdated leave language is one of the most common findings, because the rules change almost every January.

5. Required training

At 5 employees, harassment prevention training is due every two years: two hours for supervisors, one hour for everyone else, and within six months of hire or promotion. The check-up confirms who was trained, when, and that you kept the records. Here is how the training works for small employers.

6. Written safety plans

• An Injury and Illness Prevention Program under Labor Code 6401.7.
• A written workplace violence prevention plan under Labor Code 6401.9, with training and an incident log, for most employers.

7. Personnel and I-9 files

I-9s kept separately from personnel files, completed on time and retained correctly. Personnel files and payroll records that an employee can inspect on request within the legal deadlines. Offer letters, handbook acknowledgments and policy sign-offs on file for everyone.

How long does a check-up take?

For a company of 10 to 50 people, the document review takes about a week once the files are in hand: handbook, offer letters, a recent payroll register, a sample of wage statements, job postings, the contractor list and training records. A working session then walks through the findings with whoever owns HR, so the fixes have a named owner before the meeting ends. Nothing in the review requires you to stop hiring or change systems first.

What do you get at the end?

A ranked list, not a binder. Items that carry penalties or back pay go first. Items that only need a policy update go last. Each item names the fix, the owner and the deadline. If the list is long and nobody on staff owns HR, that is the point to look at what fractional HR costs against the cost of the findings.

McKinley holds a J.D. but is not a licensed attorney. Articles here are general information, not legal advice. For your specific situation, talk with an employment attorney.

Data current as of September 2026. Sources are linked where each figure appears.