3 Ways HR Tech Impacts Startups

HR Tech Outlook | Thursday, August 29, 2019

For startups, human resource management (HRM) is responsible: Recruitment, payroll and benefits, training, employee retention, and communication across the organization.

FREMONT, CA: Human resources are often considered the gatekeepers who impact a company's journey by deciding whether or not a job application will progress. However, they have a far greater role to play apart from their role in the hiring of new candidates. They act as an ally as well as a coach to the new hire, assisting them in learning their role and understanding the organization. Even the tenured employees see HR as being responsible for their continued motivation, development, wellness, and safety. The role of HR becomes even more important in the case of startups.

Let’s get into some more detail over the role of human resources for startups and the requirements for setting up strong HR practices. In case of startups, human resource management (HRM) is responsible for the following: Recruitment and hiring, payroll and benefits, training and development, creating a safe, productive, and health environment, employee retention, and communication across the organization.

When HR is performing its job, employee outputs, loyalty, and commitment increases which helps the business to achieve its goals. Several statistics demonstrate the importance of an effective HR for startups. Here are a few of them:

• Organizations can increase their quality of hire by 70 percent by investing in strong candidate experience.

• 75 percent of employee tend to spend more time in the organization that addresses their concerns

• Disengaged resources are around twice more likely as engaged ones to seek new jobs

Taking the above facts into consideration, here are the human resources needs for startups:


Human resources act as the bookkeepers of a company’s workforce. It maintains all the paperwork that is required to ensure that the business is compliant with the local laws and is immune to disputes. In general, each of the startups should ensure the following paperwork on each employee:

• Medical file, including disability information (if applicable)

• I-9 form to ensure that the employee is eligible to work in the U.S.

• Employee file, which should include a resume, training verifications, reviews, payroll details, W-4 forms, and any other data which documents a resource’s tenure with the business.


Documentation must be complemented with compliance. There are several labor laws and regulations with respect to the workplace. HR teams must be aware of the following:

• Wage and hour laws, and in particular the Fair Labor Standards Act (FLSA), and the individual state laws with respect to minimum wage.

• Anti-discrimination laws, including Americans with Disabilities Act (ADA), Title VII, and the Age Discrimination in Employment Act (ADEA).

• Leave laws, in particular, the Family and Medical Leave Act (FMLA), and the state laws.

• Immigration laws, including the Immigration Reform and Control Act (IRCA), Immigration and Nationality Act (INA), and the Illegal Immigration Reform and Immigrant Responsibility Act (IIRIRA).

• Benefit laws, which include the various required benefits that employers must provide. However, these vary according to the size as well as on the region of business.

•Safety laws, to ensure that the business is compliant with the Occupational Safety and Health Administration (OSHA).

• Union laws which require a business to be compliant with the National Labor Relations Act (NLRA).

Recruitment and Hiring

As mentioned earlier, recruitment and hiring extend beyond writing a compelling job description and sharing it on various platforms where the probable candidates can find them. Some regulations must be adhered to while hiring, such as Equal Employment Opportunity (EEO) laws.

As per a survey from CareerBuilder, the average cost of a bad hire is around $17,000 annually in lost outputs, cost, and time of hiring and training a replacement. Moreover, these are the people who will work with others every day, so it’s essential that they are a good fit for the company.

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