Industry Trends

HR For Startups & Modern Companies: All You Need To Know

Karolina Kulach
Senior Content Marketing Expert (HR & Payroll)

Launching a startup or running a growing company is no easy task, especially in the current economic recession. Implementing modern HR processes can be overwhelming, too.

But here’s the thing:

This article will help you align your people strategy with business goals. You’ll learn about:

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Click the links below to go directly to the HR topic of your interest*:

Recruitment, hiring, onboarding, and layoffs
Employer compliance, policies, documentation, HR audits, and payroll
HR Tech and HRIS
Building a company culture
Employee engagement and retention
Employee training, development, and performance management

*The information, data, and guidance provided in this article is for general information purposes only and does not constitute professional or legal advice.

HR for startups: recruitment, hiring, onboarding, and layoffs

As a startup, you may only need a few employees at first. But if you’re growth-minded, this may change quickly.

Therefore, it’s important to establish recruiting and onboarding procedures. You should have an idea about how you’ll make hiring decisions, post open positions, and onboard new employees. Even for your current employees, you need to have a number of critical elements in place.

Additionally, you must take care of all the necessary paperwork, documents, and templates: offer letters, legal employment verification, employee data for payroll purposes, employment agreements, or equity paperwork. The list is not exhaustive.

You must also classify your workforce correctly and follow relevant laws, e.g. full-time, part-time, temporary and seasonal employees, contractors, consultants, etc. Misclassification can be a costly mistake with potential penalties.

Check out Symmetrical’s HR Checklist to make sure you’re on top of your HR and people strategy.

Your hiring forecast and recruitment and onboarding plan

A hiring forecast will help you avoid gaps in essential staffing as your company grows. To forecast staffing needs, make sure you understand your company’s strategic goals and fundraising plans.

Consider which roles you plan to hire, when, projected salaries, and benefits. For that, collect data from various departments (current staff) to understand their current objectives, obstacles, expansion plans, and future needs.

Try to have 3-month and 6-month projections that you can revisit and adjust.

A simple recruitment and onboarding plan

  1. Create a recruitment funnel. It needs to be well-planned and work smoothly for your startup to scale quickly. Ensure proper screening, assessment, background verification, and interview processes. Use the right ATS.
  2. Create a great candidate and onboarding experience. Make talent acquisition repeatable and scalable.
  3. Create an employee handbook: a living document that grows with you and answers many basic employee questions, which saves your HR department’s time. The handbook ensures employees aren’t confused about policies and procedures.

Hiring at startups: who should you hire first?

When hiring your first employees, consider building your team from the top down. The following order can work well:

The first 10 hires for your startup are likely to include (depending on your needs):

  1. CFO (Chief Financial Officer)
  2. COO (Chief Operations Officer)
  3. CTO (Chief Technology Officer)
  4. Product Manager
  5. Head of Sales
  6. Head of Marketing
  7. Head of Content
  8. Graphic/UX Designer
  9. Head of Customer Success
  10. Human Resources Manager

After you’ve decided which roles you want to fill first, come up with a recruitment budget.

What are the right candidates for your startup?

On top of experienced employees, make sure you also consider high-potential candidates who are eager to learn. At startups, on top of hard skills, soft skills such as collaboration, adaptability, agility, and a passion for learning are essential. Always ensure an employee-organization fit.

Additionally, choose the right candidates for senior and leadership roles. On top of professional experience, people management skills are mandatory. Enthusiasm and charisma are also desirable characteristics.

Finally, Kasia Gorska, Head of People & Culture at Symmetrical, stresses the importance of hiring the right HR expert.

Your (first) HR employee should have a strong skill set and a sense of ownership. It’s absolutely necessary when you build HR processes and people strategy from scratch. But they also need to feel comfortable doing “the dirty work” and numerous tedious tasks. Operational work is part of the package, even if you’re an experienced senior employee.

Kasia Gorska, Head of People & Culture at Symmetrical
Kasia Gorska, Head of People & Culture at Symmetrical

Attracting the right talent: recruitment challenges for startups

Startups and fast-growing companies need high-performing talent, especially during the hyper-growth stage, to drive high performance and rapid output.

Therefore, startups can’t afford to waste resources and constantly replace employees.

Many startups fail because they don’t hire the right people.

Startups need the best people for the job. But here’s the thing: the same people are probably wanted by other companies (recession or not).

Unfortunately, it’s not easy for many startups to compete for top talent against bigger brands. In the early stages, offering all employee benefits, competitive salaries, or a consistent company culture is difficult.

But above all, when you’re new on the market, people may not recognize your brand. As a result, attracting top candidates may be practically impossible, especially in the economic downturn.

Candidates realize there’s a big risk of being hired and fired in the same month, and many will think twice before leaving their current employer.

If you’re experiencing issues with attracting the right talent when you’re a young company, referrals may be an easier way for you to attract top employees.

Additionally, you can use HR and employer branding experts to help you:

A positive candidate experience is key: it may be the reason a candidate accepts one offer over another. Additionally, always take the time to thank unsuccessful candidates and appreciate their interest in your company.

Onboarding at startups

Great onboarding improves employee engagement, performance, and retention. Additionally, new hires can be useful for your company from day one.

Having limited resources is no excuse for a poor onboarding process. Failing to provide direction to new staff is very unprofessional. This also puts an employer’s reputation at risk. For example, potential candidates may think your organization is too disorganized to be worth their time.

For this reason, do your best not to look confused or too casual while onboarding employees. Giving them a laptop and taking them to lunch is not enough. It’s ok to let them explore some things on their own. However, there must be some structure and plan to it.

A good onboarding process helps:

Consider creating an onboarding guide (employee handbook) to educate new employees.

Among other things, educate new hires about:

Employee onboarding often brings to mind excessive paperwork and boring formalities. But it doesn’t have to be this way.

Tips to improve your onboarding process

  1. Keep track of all onboarding tasks with automated checklists and alerts assigned to relevant employees.
  2. Develop a repeatable onboarding process (orientation, documentation, and progress tracking) to minimize manual effort and errors and to create a better employee experience.
  3. Create quick, secure, and paperless onboarding processes with good HRIS and automated workflows.
  4. Make sure your document signing process is secure and remote-friendly.
  5. Avoid overwhelming new employees with too much information so they don’t feel confused.
  6. Determine what's essential to communicate right now and what can wait.
  7. Send welcome packs and show your kindness every step of the way.
HR & payroll automation saves time & reduces manual work: unhappy & happy HR employee

Layoffs at startups

What is the best way to handle layoffs at startups?

Running companies is not only about hiring but also firing. This can be a very sensitive topic in startups and small teams. Employees tend to be close to each other and often treat one another like family members.

Unfortunately, sometimes you have to let an employee go, not only in the Great Layoffs season. If this happens, remember to provide a warning before termination. Don’t let firing be a surprise, and give your staff a chance to correct their actions or behavior.

Furthermore, firing an employee should be an objective, performance-based process. It should be thoroughly documented, for instance by keeping detailed records of warnings and a corrective action plan.

It’s never easy to let an employee go. However, do your best to handle terminations with grace and dignity. Wish leavers good luck and, if appropriate, offer writing recommendations for them.

The way you treat your leaving employees shows your stay team how much you care about employees as human beings.

HR for startups: employer compliance, policies, documentation, HR audits, and payroll

When it comes to HR strategy for startups, employer compliance is your bare minimum stage. You have a moral and legal responsibility to comply with relevant local, regional, and national labor regulations.

Furthermore, a safe, healthy workplace and fair employment practices have a critical impact on employee productivity. Thus, ensure your work environment is safe for employees and meets legal regulations.

To stay compliant, make sure you:

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Start with establishing areas to evaluate and verify for compliance (HR audit), for instance company policies, documents, workplace safety, organizational strategy, recruitment, benefits, payroll, salary structure, or employee relations.

For example, workplace safety requirements include emergency action plans, sufficient emergency exits and routes, medical and first aid supplies, safe working surfaces, etc.

Make sure you don’t forget psychological safety! Your employees should enjoy a safe and nurturing work environment where they feel comfortable expressing themselves.

[Important] Labor and employment regulations can change. Thus, stay on top of changing regulations to remain compliant.

Company policies

Company (HR) policies are mostly invisible. However, HR policies:

Company policies usually relate to time off, expenses, benefits, equal opportunity, sexual harassment, employee evaluations, dress code, and so on.

To create HR policies, check out templates available online. Liaise with your lawyer or legal team to ensure they comply with the law.

Consistent HR communication is key. Thus, communicate company policies to employees, and ensure they know where they can find them.

[Important] HR in a startup needs to provide some much-needed structure to improve operations and employee experience and to help you minimize risks. However, flexibility, especially for your employees, is key.

Remember that many employees choose to work for startups as they’re not into strict corporate environments. Therefore, HR in startups should create a flexible environment that allows your company to operate in an agile way.

Keep startup HR simple:

Company documentation

When you’re assembling your HR department, start with the following documents:

You may only need a few rules and policies at the initial stages of development for your company. This changes, however, when you grow.

Hence, adopt a policy mindset when your business is young. ‍Implement essential organizational policies like timing, breaks, gender equality, DEI (diversity, equity, and inclusion), non-harassment, etc.

Creating a draft in the very beginning will save you a lot of time and hassle later on.

HR audits

Startups are not exempt from national and local labor regulations. Thus, stay prepared for HR audits that will review your company’s HR documents, policies, procedures, etc.

Create an HR audit checklist (HR compliance checklist) for a smoother HR audit process. It should give you a roadmap for your HR audit and ensure all stakeholders know the applicable regulations and rules.

An HR audit checklist will help you understand which processes and systems work for you and identify the ones you must fix or stop.

An HR audit checklist helps you assess compliance related to:

The list is not exhaustive and depends on the size, location, industry, etc.

Check out this 15-Point Payroll Checklist.

15-Point Payroll Checklist: Assess Your Payroll Performance

Systems and administrative processes for payroll

When your workforce starts growing, the lack of streamlined tasks, procedures, and policies during high growth equals excessive admin. And let’s face it: you don’t have time for that.

Managing data for 50 employees in Excel sheets may be easy. However, this is different with 200+ employees.

When doing payroll manually isn’t sustainable anymore, and you’re a tech-savvy startup, implementing modern HR and payroll tech seems obvious.

To simplify your HR and payroll processes:

Managing HR and payroll admin efficiently is key. HR personnel usually spend too much time doing redundant tasks, such as follow-ups, paperwork, etc. Therefore, it’s worth automating as much as possible and investing in the tools to create efficient processes early on.

Waiting to make software-buying decisions until it becomes an absolute necessity costs companies money.

Symmetrical recommends you invest in automation combined with dedicated payroll support. In the long run, it can dramatically reduce the time and money you spend on payroll processing.

This will also free up plenty of time for more strategic HR & payroll planning and building a thriving company culture.

Check out the latest payroll statistics and payroll facts.

HR For startups: HR Tech and HRIS

The HR software market is growing. So is the role of HR technology.

HR statistics: Global HR software market 2020-2028 (chart)
HR statistics: automated HR process growth (chart)

Using HRIS (Human Resource Information System) software is the easiest way to streamline your tasks and keep everything in one place in a secure way. It can also prevent costly mistakes and save you time and money.

Streamlining processes can help HR focus on improving employee engagement and maximizing human capital.

HRIS is especially helpful for startups with limited HR and payroll-related resources. It often makes sense to invest in an all-in-one solution capable of managing diverse functionalities, automating admin tasks, onboarding new employees, etc.

Modern HRIS software is a holistic system that also allows you to:

Furthermore, HR technology helps you manage a large remote workforce. It enables you to deal with complexities, such as time zones, varying labor laws, tax forms from multiple countries, etc.

Finally, many HR and payroll solutions offer mobile and employee self-service access options.

Common objections to investing in HRIS

If you don’t know which HR and payroll provider to choose (or whether you should invest in HR tech), your hesitation is understandable. Getting new software means getting trained to use it, and an initial extra cost. However, consider this:

What’s the main source of problems in using HR tech? Good people using the wrong systems.

So make sure you choose your HRIS solution carefully:

Your HR and payroll software should significantly minimize your manual work and, thus, business costs. For instance, consider the high cost of running payroll manually. Your automated payroll service shouldn’t be an extra cost but a money saver that reduces your manual work.

Automating administrative tasks can be one of the biggest game changers when reducing startup costs and giving more time to HR professionals.

HRIS vs. the size of your startup

If your startup employs below 20 employees and your HR department is tiny (or doesn’t exist), HR technology can help you with:

When your startup reaches the 20-employee threshold, consider the following HR tools:

If your startup employs over 50 workers, consider the following HR tools:

If your startup employs over 100 people, consider the following HR tools:

HR for startups: building a company culture

How do you create a good startup culture?

First, let’s start with some myths. Top management in startups often assumes that a company culture will form on its own and that the founders’ values automatically become company values and culture, too.

This is not how it works. Imagine you employ a number of individuals of various backgrounds in a dynamic workplace environment with constantly changing priorities. If your work culture forms on its own, it’s likely to be chaotic and random. For this reason:

Building your company culture must be intentional and relate to the founders' personalities. Creating a healthy company culture is critical for every organization. Don’t leave it to chance!

Building the right culture in fast-growing organizations is challenging. But it will help keep your employees engaged and focused on the company vision and a common goal.

Now let’s dispel another myth. Culture isn’t about stickers on laptops and posters hanging over water coolers. Your company culture is a set of core values that affect your employee’s choices, decisions, and performance. It also impacts your employer branding.

That said, your company culture will help you evaluate whether a candidate is a good “value fit” with your company. Your job descriptions, benefits, policies, and HR department should reflect your company values to attract and keep the right employees.

Crucial steps to build a great company culture

Focusing on product development and business numbers in startups is critical but not enough. Building a company culture impacts the ROI in the long term.

Modern HR is not only about numbers and charts for the top management. Above all, it’s about human beings working with other human beings towards a common goal. Every number, chart, and financial success has a human behind it.

Kasia Gorska, Head of People & Culture at Symmetrical

Crucial steps to build a great company culture:

There’s a myth that the company will develop a culture and values on its own, and everything will be ok. This rarely happens. That’s why you need conscious efforts as well as intentional policies and decisions.

Startup HR: employee engagement and retention

As you grow, you need to drive high performance and recognize and reward your employees for their effort. You can’t afford to lose momentum due to disengaged employees.

According to Gallup:

Disengaged employees mean:

Therefore, building a high-performance culture that drives employee engagement is key for growing companies.

Your people are your biggest asset. Never doubt whether investing in your employees and their well-being is worth it.

The reasons for employee disengagement at startups include:

And here’s the thing: don’t wait until it’s too late. Speak with each team member regularly to understand their satisfaction level and make improvements where necessary.

Failing to address people issues on time will negatively impact your company’s culture, employee satisfaction and well-being, and overall business growth.

Engage your employees throughout the year with our 2-in-1 HR Calendar & HR Planner 2023!

Employee Engagement Calendar 2023: download now

Employee retention ideas for startups

Retaining high performers isn’t about ‍quick fixes or one-off financial incentives. You need a regular reward structure to reward top employees on time and motivate them to improve.

Here are some employee retention ideas for startups:

  1. Promote work-life balance and healthy lifestyle, e.g. by giving generous time-off.
  2. Build a recognition policy to minimize attrition.
  3. Give your employees meaningful responsibilities.
  4. Offer monetary incentives and shares in the company, but also rewards that aren’t monetary.
  5. Establish a system for gathering employee feedback.
  6. Use surveys and analytics to better understand workplace sentiment.
  7. Make sure you know how to handle potential employee concerns.
  8. Don’t wait to address workplace conflicts, complaints, and concerns.
  9. Collect employee feedback after resolving the problem.
  10. Celebrate your employees.

HR for startups: employee training, development, and performance management

Learning and development are important at companies of all sizes. Training and up-skilling your current employees work to your advantage by saving you the time and cost of hiring new employees.

According to various employment and HR statistics:

Unfortunately, learning and development may be easily overlooked, especially when you’re getting your business off the ground.

However, if you wait too long to establish a training plan for your staff, you risk issues with employee retention and losing your top employees. Hiring top employees doesn’t mean they don’t want to learn new skills!

According to IBM’s study, employees are 12 times more likely to quit a job if they aren’t getting the training and development they need. Remember:

It’s costly to replace every employee who leaves: it can be up to 30% of the position’s salary.

Therefore, to retain your high-performing employees, you need to provide them with growth and development opportunities. Create a culture of learning with training programs. Keep your employees’ skills sharp.

Finally, the truth is that the Great Resignation is not a myth, even in the Great Layoffs time. Thus, resist the temptation of treating training as an unwarranted expense.

What if your budget is currently limited? How to save on training?

Train people well enough so they can leave, treat them well enough so they don’t want to.

Richard Branson

HR for startups: performance and feedback

Provide your employees with opportunities for personal and professional growth, but also with constructive feedback for improvement.

Performance tracking should start with creating transparent performance standards and expectations.

Do your best to align individual employee strengths and day-to-day tasks with business goals. Setting OKRs (Objectives & Key Results) and KPIs can be extremely helpful here.

Startup HR: conclusion

While startups focus on product innovation, it is their employees that fuel success. Business growth depends on a highly engaged and productive team.

So it’s in your interest that your employees are satisfied and happy with their workplace.

Therefore, put people first. Employees who feel valued and cared for are more productive, creative, and motivated. This improves your key metrics but also your reputation as an employer.

About Symmetrical

Symmetrical is a better way to run payroll and HR admin. It enables fast-paced companies to onboard at scale and run their payroll invisibly. To run your payroll hassle-free and on autopilot, contact Symmetrical’s experts to learn more!


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Karolina Kulach
Senior Content Marketing Expert (HR & Payroll)
I'm a non-fiction writer, content manager and a passionate digital content creator. I have a huge interest in topics related to employee experience and employment trends in the world of Payroll & HR. I'm also a well-travelled individual with international education and work experience gained in London, Scotland, Poland and Germany. In my spare time I buzz with creative content ideas, including funky rhyming poems.

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