So, your organization is growing? That’s great and something most organizations plan for; however, this accompanies legal requirements that creep up often faster than leaders expect. Employment laws, benefits requirements, and reporting obligations are frequently triggered by employee count, making growth an exciting but risky phase if compliance isn’t planned for in advance. Understanding which requirements apply at each stage of growth allows employers to prepare, avoid costly mistakes, and build a strong HR foundation that supports both the business and its employees.

First Employee: Compliance begins with your very first hire. Make sure you have I-9 Verification and have filled out an I-9 form. Ensure you have proper new-hire reporting and Workers’ Comp Insurance. You are required to be compliant with Wage and Hour Laws, regarding things like minimum wage, overtime pay, and record keeping. You must be compliant with the FLSA and PUMP Act, which provides lactation protections, as well as OSHA. This is a good time to write policies around time keeping and pay practices, work schedules, attendance, and standards of conduct, as well as include an at-will employment disclaimer.

5-10 Employees: In this early growth stage, you should start writing a formal employee handbook that includes anti-harassment and discrimination policies, a complaint reporting procedure, a disciplinary process, remote work policy if applicable, and supervisor training. There are also state regulations that start at this threshold, like paid sick leave and workplace poster requirements, so be sure to ensure compliance with the states you operate in.

15 Employees: At this threshold, you must be compliant with Title VII and the complaint reporting process. You must include an investigation process, disciplinary process, and a no retaliation clause in this policy. You are required to post EEO Posters, and you must abide by the ADA Reasonable Accommodation Process as well as the Pregnancy Discrimination Act. An update or creation of your anti-harassment and EEO policies is imperative at this stage for legal compliance.

20 Employees: As you continue to grow and reach this number of employees, you need to comply with the ADEA (Age Discrimination in Employment Act) as well as COBRA, which allows terminated employees to continue to receive health benefits for a period of time after their employment has ended. At this stage, you should be including benefit offerings and eligibility information in a policy in your handbook and ensure these policies, as well as your leave policies, are compliant with ADEA.

25-49 Employees: At this milestone, leave tracking becomes more complex as state and local leave laws often apply before federal ones. As stated before, you should check the parameters for where you are operating and where you have employees to remain compliant. This is also a great time to formalize your job descriptions and audit FLSA exemption statuses while you centralize employee records. Handbook policies to include at this stage are paid sick leave, PTO administration rules, performance management procedures, and formal attendance and scheduling policies.

50 Employees: This is a crucial growth milestone for compliance. Employers must now comply with the FMLA (Family and Medical Leave Act), which allows eligible employees to gain up to 12 weeks of unpaid, job-protected leave for medical or family reasons during which they can also keep their benefits. There is an ACA (Affordable Care Act) mandate at this level that states the employer must offer affordable health insurance to 95% of full-time employees or face IRS penalties. This is required for all ALEs (Applicable Large Employers). ALEs must file Form 1095-C with the IRS and provide copies to employees to document health coverage offers. At this milestone, you have additional COBRA obligations and need to issue the required notices. You also need to have processes for tracking hours and maintaining leave documentation. If you are a federal contractor, your EEO-1 reporting requirements kick in at this threshold. You must have an FMLA policy in your handbook, and your accrual and tracking language should coordinate with any state leave laws as well.

100 Employees: Once you have reached this threshold, you are now required to do EEO-1 Reporting. You are also subject to follow the WARN Act, which requires a 60-day advance notice for mass layoffs or plant closings.

Other Milestones: Aside from just headcount growth, there may be other milestones you reach that trigger compliance pieces. You will need to look out for multi-state law compliance when you hire in a new state, remote or hybrid workforce changes, major benefits changes, restructuring/reorganizing, and union activity.

Growth is a positive thing, but most of these milestones are predictable, so waiting until after you cross a threshold is costly and ill-advised. Proactive HR planning allows for fewer surprises and better risk management. Make sure things like your handbook and supervisor policies evolve with you as you grow. If your handbook hasn’t been reviewed since your organization last crossed an employee count threshold, it may no longer reflect your current legal obligations or operational reality. A regular handbook review at key growth stages helps ensure compliance and improve consistency. By anticipating these milestones and updating your policies along the way, you position your organization to grow confidently and safely, and support employees at every stage.

ASE Connect

Compliance Milestone Checklist: ASE’s Compliance Milestone Checklist for Growing Organizations breaks down key requirements by headcount and flags non headcount events that should trigger a compliance review. Download it here.

ASE Handbook Services: For help updating or creating an employee handbook, please contact Lauren Cromie.

Sources: greaterhuman.captital; irs.gov; dol.gov; uscis.gov; eeoc.gov; Ibmcep.com