For family offices, HR compliance isn’t just about avoiding legal trouble—it’s about protecting the family’s reputation, creating a respectful workplace for employees, and staying aligned with your values. Whether you’re managing household staff, investment professionals, or philanthropic teams, understanding HR compliance for family offices is essential.

This guide breaks down exactly what family offices need to stay compliant—and what you can do today to mitigate risk.

Why Compliance is Different in Family Offices

Family offices may not look like traditional businesses, but they’re still employers—and subject to the same local, state, and federal labor laws. In fact, family offices often face more complexity, due to:

  • Informal or legacy employment arrangements
  • Multi-state operations (e.g. staff in multiple homes or states)
  • Privacy concerns around employee records
  • A mix of personal and professional roles on staff

Even if your office is small, HR compliance issues can result in lawsuits, penalties, or damage to the family’s reputation if not handled correctly.

1. Know Your Legal Obligations as an Employer

Family offices must comply with the same baseline employment laws as any other business:

  • Fair Labor Standards Act (FLSA) – Defines minimum wage, overtime, and exempt vs. non-exempt employees.
  • Occupational Safety and Health Administration (OSHA) – Requires safe working conditions, even in private homes.
  • Title VII of the Civil Rights Act – Protects employees from discrimination based on race, gender, religion, etc.
  • Americans with Disabilities Act (ADA) – Requires reasonable accommodations for qualifying disabilities.
  • State-specific employment laws – Often more protective than federal regulations.
  • Non-Disclosure Agreements (NDA’s) – If discretion is an expectation in your family office, NDA’s should cover all the key areas that you expect discretion around. This should be a part of every employee’s onboarding paperwork and crafted with the help of the family office’s lawyer

If your family office hires domestic staff (nannies, chefs, estate managers), you may also be subject to state and local domestic worker bills of rights.

Action Step: Conduct a full audit of your employment practices with an HR compliance checklist or professional review. This is something Red Clover HR can help with.

2. Create (or Update) Your Employee Handbook

Many family offices either don’t have a handbook or use one borrowed from a corporate template. That’s a mistake.

A well-written, custom HR handbook sets expectations, defines policies, and protects both the employee and the family.

Key policies to include:

  • At-will employment status
  • Paid time off, sick leave, and holidays
  • Privacy/confidentiality policies
  • Workplace conduct and harassment policies
  • Social media
  • Termination procedures

Action Step: If you don’t already have one, create a custom handbook for your family office that’s reviewed by a qualified HR professional.

3. Get Clear on Worker Classification

Misclassifying employees as independent contractors is one of the most common (and costly) HR compliance issues.

In a family office, this often happens with:

  • Personal assistants
  • Drivers or security staff
  • Housekeepers or estate managers

These workers are usually employees, not contractors—especially if you control their hours, location, and work responsibilities.

Misclassification can trigger back taxes, penalties, and fines.

Action Step: Review all contractor agreements. If you’re unsure, Red Clover HR can help you determine correct classification.

4. Comply with Payroll, Taxes, and Wage Notices

You must:

  • Pay at least minimum wage (federal or state—whichever is higher)
  • Pay overtime to non-exempt employees
  • Provide wage statements and notice of pay rate
  • Withhold and remit payroll taxes (Social Security, Medicare, federal and state)
  • Comply with household employer rules if applicable

Many family offices outsource payroll to avoid errors—but even outsourced payroll needs internal oversight.

Action Step: Partner with a payroll provider experienced in private family staff AND have your HR team review your payroll setup annually.

5. Train Your Staff on Harassment and Workplace Behavior

Even small teams need policies—and training—on what’s acceptable behavior.

A harassment claim from a personal assistant or executive assistant, even if informal, can create a legal and reputational nightmare.

Your responsibilities include:

  • Creating a harassment and anti-discrimination policy
  • Offering training for staff and family members
    • Note: Certain states have requirements for mandated training that has to be administered, especially regarding harassment. Check your state’s labor laws to know what you are required to deliver.
  • Providing confidential reporting mechanisms
  • Taking complaints seriously—even in informal roles

6. Document, Document, Document

Lack of documentation is a major compliance liability.

  • Keep written offers, contracts, NDAs, and handbooks on file
  • Maintain performance notes and disciplinary actions
  • Ensure termination paperwork and severance agreements are stored securely

Bonus: If you ever need to terminate someone, documentation will help you do it fairly—and protect the family legally.

7. Don’t Forget Multi-State or International Issues

Many family offices employ people who work in different states—or even internationally. This complicates HR compliance significantly.

You may need to:

  • Register to pay taxes in multiple states
  • Follow multiple state PTO or sick leave rules
  • Comply with foreign employment laws for international hires

Action Step: Have an HR expert conduct a multi-jurisdiction compliance review annually.

Conclusion

HR compliance isn’t just a box to check—it’s a critical layer of protection and professionalism in your family office. From proper worker classification to harassment policies, payroll compliance to multi-state law management, your ability to stay compliant impacts both your staff and your family’s reputation.

The good news? You don’t have to do it alone. Red Clover HR offers discreet, strategic outsourced HR for family offices, including compliance audits, custom policy development, and hands-on guidance through every stage of the employee lifecycle.