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HR Policies for startups

Essential HR Policies for a Startup Company

HR Policies for startups

Human Resources (HR) is an important department for every profitable business. The human resource department forms the organization's backbone by hiring suitable people. The success of any business enterprise is measured in terms of staff satisfaction and work performance.

The Human Resource (HR) Department undeniably plays a vital role in any organization, whether a startup or a multinational. In a startup, HRs are responsible for supporting the growth of the business by defining and attracting the ‘right’ talent, determining the organizational structure, creating clear communication channels, framing the code of conduct, and so much more.

HR Policies for a Startup in India

  • Code of Conduct: The code of conduct HR policy consists of the aim, vision, and mission of any startup. It also helps to build and maintain the right workplace for the employees. Most importantly, it contains rules and regulations for the employees to abide by.
  • Leave Policy: This is one of the most important policies for any employee of the organization as it outlines the various types of leaves an employee can avail in different situations like maternity leave, female-day care leave, casual leave, sick leave, annual leave, and more. Many organizations have a non-paid leave policy as well depending on the situation where the salary of the employee will be deducted.
  • Employee Appraisal and Promotions: This is another policy company that stands as one of the important HR policies for a startup. In this, the founders, and the top-level management evaluate the employee’s performance over a period of six months or annually and provide them critical feedback on their performance, and then reward them accordingly with an increase in salary and promotions.
  • Rewards & Recognition: When the employees are appreciated, they tend to work better. As part of many HR policies, this policy states how the employees must be rewarded based on values, goals, and priorities. Many companies reward employees quarterly with monetary rewards or gift vouchers to boost employee morale.
  • Work from Home Policy: Ever since the novel coronavirus hit the globe, various organizations have shifted away from the traditional way of only working from the office to working from anywhere i.e. working from home. Some startups are working completely remotely whereas others are insisting their employees come to the office full-time, or a fixed number of days a week.
  • Health and Safety Policy: For any startup, the well-being of its employees is the foremost concern. It includes not only physical well-being but also mental and emotional well-being. Hence, the HR department frames various health and safety policies for the employees to ensure that every employee is provided with the best work environment at the workplace.
  • Employee Separation Policy: When the employee decides to leave the organization, once again the role of HR comes into place where various documentation work is exchanged amongst the employees and the employers. There are various exit formalities that are to be cleared by the employees before the company in order to avail the full & final payment, relieving letter, or experience letter.
HR Policies Checklist for a startup
Types of HR policies in India

Why does a startup need an HR policy?

There are various reasons why a startup needs an HR policy. Listed below are a few reasons:

  • In a startup, clear-cut HR policies help to treat employees fairly across the organization.
  • Such HR  policies serve to preempt various misunderstandings between employees and the employer regarding employees' rights and obligations in the workplace.
  • These policies help early-stage & growth-stage startups in saving valuable time and resources.
  • The absence of clear HR policies leads to a decline in employee morale, deterioration in employee loyalty, and increased vulnerability to even legal penalties.


This blog gives an overview of any organization's most commonly used policies. These policies majorly depend on the company size, type, and industry, and these policies must come into action based on the same. When framing the HR policies and procedures, it is imperative for the Human Resource team of every organization to keep in mind all the business practices and all the applicable national, state, and local laws.

Essential HR Policies for a Startup Company

HR Policies for startups

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