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The small business HR setup checklist

The small business HR setup checklist

You do not need an HR department to run HR well. You need clear records, rules everyone can see, and one agreed way of getting things approved.

This checklist covers the setup work that most small and growing businesses skip or leave half done. Work through it in order, or pick the section that is causing you the most trouble today. Each item is one decision or one task. Tick it when it is done and written down, not when it is "roughly agreed".

Rules on leave, attendance, records and employment vary by country and sector. Where a decision touches the law, check your local labour law and get advice from a qualified adviser. This checklist is a practical guide, not legal advice.

1. People records

  • [ ] Every current employee is on one list, one row per person
  • [ ] Each employee has a unique employee ID that is never reused
  • [ ] Names are spelt the way each person spells them
  • [ ] Work email and mobile number are recorded in one consistent format
  • [ ] Department and designation names are standardised (one spelling each)
  • [ ] Each employee's manager is recorded by the manager's employee ID
  • [ ] Joining date and employment type are recorded for everyone
  • [ ] Emergency contact details are recorded and up to date
  • [ ] People who have left are removed from the active list or clearly marked

2. Working week and holidays

  • [ ] Your working week is written down (which days are working days and which are off)
  • [ ] Shift start and end times are defined, and each employee is assigned a shift
  • [ ] This year's public holidays you observe are listed
  • [ ] Any extra company holidays are added and announced
  • [ ] The holiday calendar is shared with all staff at the start of the year

3. Leave rules

  • [ ] Every leave type is named, with who it applies to
  • [ ] For each type, you have decided whether balances are given upfront or build up over time
  • [ ] Carry-over rules and any limits are decided
  • [ ] Notice periods for planned leave are decided
  • [ ] Half-day rules are decided for each leave type
  • [ ] Evidence needed for sick leave, and from when, is decided
  • [ ] Blackout periods (if any) are named in advance
  • [ ] Opening balances for every employee are agreed and recorded
  • [ ] Who can adjust a balance, and how the reason is recorded, is decided

4. Attendance rules

  • [ ] Grace time before someone is marked late is decided and written down
  • [ ] Late, half day and absent are each defined with times
  • [ ] Rules for early leaving are decided
  • [ ] Work places (office, factory, site, warehouse) are listed with addresses
  • [ ] Rules for field staff and travel days are decided
  • [ ] A correction process exists, with a reason, evidence and an approver
  • [ ] A cut-off date for corrections each month is set

5. Approvals

  • [ ] The default approval path is agreed (for example: manager, then HR)
  • [ ] Who approves managers' and senior staff requests is agreed
  • [ ] A backup approver is named for when the usual approver is away
  • [ ] A target reply time for approvals is agreed
  • [ ] Every rejection must include a reason

6. Requests and letters

  • [ ] The letters and requests staff ask for most are listed (salary certificate, employment certificate, bank letter, travel NOC and so on)
  • [ ] One responsible person is named for each type of request
  • [ ] Standard templates exist for the letters you issue regularly
  • [ ] A copy of every letter issued is kept, with who asked and who signed

7. Documents

  • [ ] One folder structure and file-naming rule is used for every employee
  • [ ] Identity, joining and contract documents are collected for every employee
  • [ ] Expiry dates are recorded for passports, visas, licences and certificates
  • [ ] Reminders are set well before each expiry date
  • [ ] How long to keep each type of record is checked with your adviser

8. Policies

  • [ ] Your key policies (leave, attendance, code of conduct) are written in plain language
  • [ ] Each policy has a version number or date
  • [ ] Every employee has acknowledged each policy, and you have a record
  • [ ] A yearly review date is set for each policy

9. Communication

  • [ ] Staff have been told how to apply for leave, check in and ask for letters
  • [ ] Managers have been briefed before staff, and apply the rules the same way
  • [ ] One official channel is used for HR announcements
  • [ ] Staff know who to contact with HR questions
  • [ ] The date when WhatsApp and paper requests stop being accepted is announced

10. Security and access

  • [ ] Only the people who need it can see salary and personal information
  • [ ] Sensitive records (national ID, passport, medical documents) are stored privately
  • [ ] Admin accounts use two-factor sign-in
  • [ ] Access is removed on the day someone leaves
  • [ ] HR data is backed up regularly, and you have checked you can restore it
  • [ ] Employee documents are not shared over chat apps

How PeopleMotive helps

  • People records

    import your employee list from Excel or CSV with a validation report that shows problems and duplicates before anything is saved. Employee IDs are numbered per company and sensitive fields are encrypted.

  • Working week, holidays and leave

    set your own working week, holiday calendar, blackout periods and leave types with your own rules for accrual, carry-over, half days, notice and sick-leave documents. Every balance keeps a full ledger.

  • Attendance

    shifts, grace time, late and early-leave flags, phone check-in confirmed against your work places, and corrections with a reason and evidence.

  • Approvals

    one approval path for leave, corrections, HR requests and profile changes, with delegation when approvers are away. Rejections need a reason and every decision is recorded.

  • Requests, announcements and policies

    twelve request types with their own forms, announcements with read tracking, and a versioned policy library with acknowledgements.

  • Documents and expiry (optional)

    private document storage with expiry reminders.

  • Security

    two-factor sign-in and passkeys, role-based access, an audit log and daily encrypted backups.

PeopleMotive HR is built for owner-run businesses of roughly 15 to a few hundred people. It covers most of this checklist in one place, on the web and the Android app:

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