HR Setup Checklist for Startups

Apply for an EIN from the IRS which is required for hiring employees, filing taxes, and opening business bank accounts.

Set up state income tax withholding, unemployment insurance, and disability insurance accounts in every state where employees will work.

Obtain workers compensation insurance as required by your state, even before making your first hire.

Register with your state's new hire reporting agency to comply with federal and state mandates for reporting new employees.

Identify all states where your company will have employees and understand each state's unique employment law requirements.

Create essential policies covering at-will employment, equal opportunity, anti-harassment, and workplace safety as your baseline framework.

Develop standardized offer letter templates that include compensation, at-will language, equity details, and contingencies for background checks.

Draft templates for confidentiality agreements, invention assignment clauses, and non-solicitation provisions appropriate for your industry.

Define criteria for classifying workers as employees versus contractors and exempt versus non-exempt to prevent misclassification risks.

Establish a secure, organized system for storing personnel files, I-9 forms, and confidential employee documents separately.

Establish a compensation strategy with preliminary salary ranges for key roles that aligns with your budget and market rates.

Work with legal counsel to create a stock option plan including vesting schedules, exercise windows, and option pool allocation.

Select and configure a payroll provider that handles tax calculations, withholdings, filings, and direct deposit for your team.

Explore group health insurance plans, SHOP marketplace options, or health reimbursement arrangements suitable for small employer budgets.

Define your paid time off structure including vacation, sick leave, holidays, and any state-mandated leave requirements.

Research simple IRA, SEP IRA, or 401(k) options to determine the most cost-effective retirement benefit for your startup stage.

Develop job description templates that include essential functions, qualifications, physical requirements, and equal opportunity language.

Establish a system for tracking candidates through the hiring pipeline, whether using software or a structured spreadsheet process.

Create consistent interview guides with role-specific questions and evaluation criteria to ensure fair and effective candidate assessments.

Select a background screening vendor and create compliant authorization forms, adverse action procedures, and individualized assessment processes.

Design a comprehensive onboarding workflow covering paperwork, equipment setup, orientation, and first-week training milestones.

Obtain and display all federal and state-mandated employment law posters in physical workplaces and distribute electronically for remote teams.

Implement harassment prevention training that meets state requirements and establish a schedule for initial and recurring training.

Develop basic safety procedures, designate a safety coordinator, and establish injury reporting and OSHA recordkeeping processes.

Create a compliant personnel file structure with separate storage for general records, medical information, and I-9 documents.

Compile your core policies into a handbook with an at-will disclaimer, acknowledgment form, and review it with employment counsel.

Create a calendar tracking recurring compliance obligations such as poster updates, training deadlines, and filing due dates.