This update highlights payroll and classification risks that continue to affect employers across the Southeast. Leaders should focus on confirming payroll threshold accuracy, reviewing benefit administration practices, and ensuring worker classifications are applied consistently across locations. Action required this week is to review payroll settings for higher earners and confirm classification decisions are documented and defensible.

Employment and Payroll Compliance Items Leaders Should Review This Week

February 9, 2026

For business owners across the Southeast, compliance risk this quarter continues to come from how payroll and employment practices are carried out rather than from new legislation. Federal thresholds have shifted again, and the Social Security taxable wage base is now 184500 for 2026. This change affects higher earning employees and makes it important for owners to confirm that payroll systems are stopping deductions at the correct limit.

Health insurance and benefit administration remain another area where small inconsistencies can create larger problems. Employer sponsored health plan costs continue to rise between 7 and 8 percent annually, and enforcement activity around mental health parity is increasing. Business owners should understand how benefits are administered in practice and be prepared to explain how behavioral health benefits are handled compared to medical benefits if questions arise.

At the state level, most Southeastern states including Texas, Florida, Georgia, Alabama, and North Carolina continue to follow the federal minimum wage. Even so, enforcement activity in the region is focused less on hourly rates and more on classification and overtime practices. Independent contractor use and exemption decisions remain common problem areas, especially in healthcare, logistics, and construction. Virginia continues to stand apart with a minimum wage of 12.41 per hour and a scheduled increase to 15, which may require compensation or role adjustments.

For owners operating in more than one state, the biggest risk often comes from assuming that pay practices and classifications are being applied the same way everywhere. Without regular review, small differences in how managers apply pay rules or exemptions can lead to meaningful exposure over time. Leadership involvement is often what determines whether these issues are caught early or discovered through enforcement.

Action item for this week is to review payroll settings for your highest paid employees and confirm that Social Security withholding stops at the correct limit and that exemption classifications are documented.

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Employment and Payroll Compliance Items Leaders Should Review This Week

Employment and Payroll Compliance Items Leaders Should Review This Week

Payroll Tax Accuracy and Benefits Enrollment Gaps Leaders Need to Address

Wage Rates and Health Insurance Premium Changes Across the Southeast

Why AI Generated Employee Handbooks Create More Risk Than They Solve

Increased productivity starts with a simple conversation.
‍Reach out and a Marvel HR team member will be in touch ASAP!

Employment and Payroll Compliance Items Leaders Should Review This Week

Employment and Payroll Compliance Items Leaders Should Review This Week

Payroll Tax Accuracy and Benefits Enrollment Gaps Leaders Need to Address

Wage Rates and Health Insurance Premium Changes Across the Southeast

Why AI Generated Employee Handbooks Create More Risk Than They Solve

Increased productivity starts with a simple conversation. ‍Reach out and a Marvel HR team member will be in touch ASAP!

Increased productivity starts with a simple conversation.
‍Reach out and a Marvel HR team member will be in touch ASAP!