What is an HR checklist for startups?

An HR checklist for startups includes the most important functions of the HR department like: hiring, onboarding, and compensation and benefits for employees without overshooting your startup’s budgetary restrictions. 

This also includes compliance and audit stages of the HR function like candidate tracking processes, forms, and policy upkeep, as well as employee data collection and storage. The HR checklist aids in achieving your business goals through optimal employee management. 

So here is the ultimate 8-point HR checklist to make sure your HR department is at its best to enable success across your startup:


1. Start with a hiring plan and selection process

Before you do anything else, the most important thing on the HR checklist is to create a hiring plan. Ask yourself the following questions:

Answering these questions helps create detailed and precise job descriptions that help you understand what sort of candidates you are looking for, and how important the roles are. Learn how to create a complete hiring plan here.

2. Create an organizational structure 

The first 10 hires for your startup can make or break the growth trajectory, so here’s our pick on the first 10 most important roles to fill when you’re hiring for your startup:

Once you’ve decided the roles you want to fill first, you need to collaborate with your hiring managers, if any, and come up with a recruitment budget. 

3. Decide your HR budget in 3 stages

Not planning the HR budget is one of the top 20 reasons why startups across the world face challenges like over-hiring/under-staffing, inability to attract the right talent, high employee turnover rates due to insufficient compensation, etc. 

But you can side-step those issues easily by understanding the components of your HR  budget—and then optimizing the spending for each component. Here are the 3 main components:

You need to decide what channels of recruitment you’re going to use to hire your first team. Your recruitment budget includes: Spending on sponsored job postings, tools required to manage the hiring process, employee referral budget, external hiring agency costs, if any, background verification and assessment costs, etc. Know the 9 steps to reduce your recruitment costs here.

You need to train and onboard your new employees, and also set aside a budget to help your employees reskill/upskill themselves regularly for a healthy and productive workforce, and of course, lower employee turnover rates. This includes budgeting for:

This budget varies on the number of employees you hire and lose periodically. Still, you can allocate funds based on your projected hiring requirements without historical turnover data to compare. 

With the Great Resignation phenomenon still raging, compensation remains a differentiator for companies to hire and retain the best employees. You can decide on this budget by understanding how much you want to spend on:

4. Create a recruitment funnel

For a startup to scale quickly, its recruitment funnel needs to be well-planned and smoothly executed. Here are the 5 stages that make up a recruitment funnel:

Stages of a recruiting funnel Stages of a recruiting funnel

What are the channels you’re going to use to attract your ideal candidates? Which job boards have given you the best ROI so far? How much are you willing to spend on these channels?

How can you create interest among the right candidates? By creating precise and detailed job descriptions that tell the candidates exactly what they need to bring to the table and why they would benefit by joining your company. This also involves creating better career sites and improving employee reviews on platforms like Glassdoor.

This is the stage where you induce the candidate to submit their resume for the job—and the best way to ensure this is by making the application process smooth and short. The more the number of steps, the less likely a candidate will complete the application process.

This is a crucial stage where you test if a candidate is the right fit for the role as well as your startup. Creating proper screening, assessment, background verification, and interview processes will help you identify and hire the perfect candidates. Using the right ATS can improve this entire process exponentially. 

Persuading the best candidates to accept your job offer and making sure there aren’t a lot of drop-offs at this stage is crucial. Salary benchmarking, easy offer management process, quick offer rollout—all of these play a major role in whether you convert your favorite candidates into your employees or not. 

Here’s the complete guide to creating a smooth and solid recruitment funnel.


5. Do away with the sub-par onboarding experience


When you visualize employee onboarding, it’s hard to think of anything other than mounds of paperwork and boring formalities that just need to be gotten over with—but this is the mistake that costs most companies dearly. A good onboarding process not only helps bring new employees up to speed improving their productivity, but it also helps them fit in with the company better and envision long-term career milestones with your startup. In other words, a good onboarding process helps improve employee retention rates. Here are the steps to create the perfect onboarding process:

6. Check for compliances

What is an HR compliance checklist?

An HR compliance checklist helps ensure that all the required information is collected and stored in a streamlined manner—and also ensures that all parties are informed about the relevant processes and regulations. A detailed compliance checklist helps with a smoother HR audit process. 

The HR compliance checklist changes based on your startup’s size, location, and field of operation. But here are some broad aspects that your HR compliance checklist should include:


7. Pick the right HRIS

Picking the right software that compliments your hiring and employee management needs can be a true game changer. But the hesitation is understandable. Getting new software would mean setting aside a budget to buy it, loads of comparison, getting trained to use the software, onboarding your HR department as well as other employees to the software, making sure that they continue using the software, and so the list goes on. 

But honestly, it doesn’t have to be that tough. When you find the right software, you’ll realize it requires very little budget, no need for training, and a simple UI that enables your employees to use it on a daily basis without any need for onboarding and consistent enforcement. Here are the top 5 features you need to look for when choosing your HRIS. 

Does it help you create your own custom career site? Can you post to multiple job boards with one tool (and save more than 80% of your costs)? Can you schedule interviews and screen resumes? Can you automate most of your hiring process? The right ATS will help you do all of the above, and a lot more. 

Good HRIS helps you create quick, secure, and paperless onboarding and offboarding processes with automated workflows. This minimizes manual effort as well as errors, creating a better experience for your employees.

Look for HRIS that enables you to track, manage, and approve employee time-off requests while also letting employees view their leave balances, all from a single platform. This also enables more employee self-service which frees up time for your HR department to focus on more important tasks.

Choose HRIS software that comes with built-in HR reporting features to track important HR metrics like time taken to hire, application dropout rate, employee productivity, etc. 

These HRIS reports are crucial to understanding which processes are working for your startup and which aren’t, and more importantly, how you can fix them. Your HR team can also understand how their work has impacted the startup’s growth and find areas where there’s scope for improvement. 

Update and track employee information in a centralized manner with good HRIS software. Employee portals store information that can be accessed by members of the startup, but good HRIS software enables employees to protect their privacy by hiding certain fields in their profile from public access too.

8. Prepare for audits

What is an HR audit checklist?

The HR audit checklist gives you an overview of or a roadmap of your HR audit. An HR audit is a complete review of your startup’s HR policies, procedures, documents, and more. The HR audit checklist helps you investigate and understand processes and systems that are working for you, and identify the ones that you should fix or stop. 

Here’s an HR audit checklist to help you assess all your HR processes thoroughly:

An HR checklist encompasses all the major functions of the HR department, and each of the 8 points is an equally important part of the HR function that contributes to the overall employee experience and candidate hiring experience as well.