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Forms and Documents you Need for Setting up HR Department


Many of us still make a checklist before we start packing for a holiday or a work tour. Such a checklist helps immensely in life, be it professional or personal.

Human Resources Forms Documents

Developing a Human Resource (HR) department within an already established organization or a new company usually takes a lot of work.

However, with the help of a well-made plan and the checklist that will be given here, it can be done. The only loophole about this list is that it is a general one and is not industry-specific.

1. Begin with Job Profiles:

Make a profile for every role within your organization and the employee who fits in it. As little or as much information as you would like, can be included.

But, if you include more info, you might be able to utilize it for future hiring and multiple other projects.

2. Use the Job Profiles to Build a Hierarchy in your Organization:

The new-age startups do not believe in hierarchy. So, while trying to build a hierarchal ladder, one might face some resistance.

However, a hierarchal structure helps immensely in workforce planning, outsource planning, and succession structure. This structure can also be used to determine salary grading and reporting, in the long run.

3. Develop a Business Staffing Plan:

This might not seem important when your organization is recruiting just some principal positions. But, a ready plan is helpful for reference, when the business grows.

You need to interact with Product Development, Operations, Sales, and Marketing. These teams or employees are supposed to have a proper idea about the number of contracts they might wish to sign or the number of widgets they wish to create. And, the manpower that you need to recruit is an integral part of that plan.

Get a clear idea about what the teams would be doing over the next 1 year. This will help you figure out your hiring needs. It will be an added bonus if you are also able to calculate the direct as well as indirect costs of a lost employee.

4. Make Use of a System:

Most small-scale companies begin their journey with some haphazard emails and a spreadsheet. This, however, makes absolutely no sense today, as there are a number of excellent software available now.

You can start with a scalable and solid applicant tracking system that has been specifically built for an SMB. Having a ready staffing plan helps you assess new products to make sure that they meet your requirements.

Staying in touch with a large number of candidates and keeping track is going to be an integral part of your everyday routine. An effective applicant tracking system would help you and the entire team immensely.

5. Create a Document for Salary Structure:

In case of small or medium businesses, the most overlooked document is a salary structure document. This should not happen.

Salaries should be discovered for different functions within the organization. Those should be compared to fair market value for same kind of positions. The salary structure should be revised every 6 months, in order to stay competitive.

If you plan to offer other types of compensation, you should keep them segregated from a salary structure document.

6. Develop a Benefits and Compensation Document:

New organizations might not offer the conventional benefits. But, there can be various benefits to offer. Creativity is the key.

You can offer your employees the benefits of working from home. A bit of research can help in creating a benefits plan that is striking and different.

7. Create a Leaves Document:

An organization should be clear about its time-off policy, sick policy, holiday policy, and vacation policy. The requirement for notices and permissions should be clearly spelled out. Job-specific time-offs should be mentioned.

It should also be pointed out whether and when exchanging schedules with another employee is permitted. A recording system must be used for keeping track.

The leaves document should have a list of the holidays the organization observes and also the holidays that are position-specific.

8. Have a Document to Appraise Performance:

Usually, the department head measures performance. While creating a job profile, how each employee measures his success should be found out. Those measurements should be written down.

The important thing is measurable and constant feedback. In due time, a performance evaluation program should be devised.

9. Create a Document for Tracking Expenses and Travel:

A small or medium organization needs a simple policy and an easy-to-use application that helps in tracking travel and expenses.

There are a number of consumer-oriented apps that can be used optimally by small or medium companies.

10. Have a Document for Attendance and Time:

The modern principles of HR are considerably less concerned about “Time In” and Time Out” recordings. However, there are a number of workplaces where tracking the attendance of some of the employees is necessary.

Whether you use a traditional register or a modern application, ensure that every policy is clearly explained to an employee before their first day at work.

If your industry needs to use overtime frequently, your documents should also include an overtime structure.

11. Create a Document for Terminations and Resignations:

Resignations and terminations will be there and they need to be addressed. It is up to the HR head to decide whether an exit interview will be conducted.

It also needs to be decided whether a formal process should precede the termination of an employee. Maintaining a document and making these decisions beforehand is going to make things less complicated.

12. Employment Contract:

An employment contract is a contract signed by an employee and the signing authority of the organization.

This contract is a written document that states the principal terms of an employment relationship.

Why is an Employment Contract Important?

This contract is important as it is one of the most critical documents in the HR department. It helps when the things get sour after the honeymoon gets over.

This contract is significant as it clarifies the do’s and dont’s during and following the period of employment.

It helps if the contract comprises defamation, confidentiality, and non-compete clauses.

How to Make a Contract Agreement:

An employment lawyer with the required specialization should be consulted. The lawyer will help you in creating the contract agreement templates that can be reused.

Employment contracts vary from one type of employee to another and also from one industry to another.

For example, the employment agreement of a construction worker should include safety clauses. Employment agreement of a salesperson should include vital clauses regarding commission structures.

13. Recruitment Processes:

The HR department should have documented processes relating to the HR functions mentioned below:

  • Advertising the vacancy
  • Explaining the position
  • Tracking candidates
  • Interviewing
  • Checking references for prospective new employees

Hiring new talent is a priority while doing it with competence is quite challenging. A documented process provides the recruitment managers and the HR department with step-by-step guidance.

Access to standardized and additional resources like spreadsheets, manager guides, and forms are helpful.

Why is a Documented Hiring Process Important?

  • A documented process ensures that the same process is followed, thus maintaining consistency.
  • The hiring process gets a completeness, as documented steps are not missed out.
  • A documented process ensures clarity as checklists, accountability, and responsibilities are defined for almost every activity. It helps everyone comprehend the role that a HR manager or a recruitment manager plays in the hiring process.
  • A documented process makes sure that the hiring manager does their homework prior to opening a vacancy and recruiting the eventual candidate.
  • Documentation ensures that the recruiting manager offers a good first impression of the company. It guarantees a professionalism that treats every applicant with respect.
  • Compliance to the documented process makes sure that the employment standards and legislated requirements are adhered to.
  • A documented process ensures that a manager with no prior experience cannot embark on the task of recruiting a new employee.

How to go about it?

Determination, communication, and documentation of the processes needed for hiring can be effectively used by anyone in the organization who plans to hire a new worker.

14. A Handbook for Employees:

An employee handbook is a manual that documents the principal employee programs, human resource programs, procedures, and policies of an organization.

The HR department can make good use of an employee handbook to save themselves from various kinds of lawsuits.

Why is an Employee Handbook Important?

  • The handbook acts as a book of rules that defines a code of conduct for all employees. It communicates the guidelines about what will be accepted and what will be unaccepted in the organization.
  • An employee, by signing on this manual, gives consent that he would abide by the guidelines that help in preventing “No One Told Me I Could Not” excuses.
  • The handbook protects employees from autocratic and ruthless managers as well as problematic co-workers. It helps everyone comprehend the acceptable behaviors and the result of non-compliance.
  • It helps in fast tracking orientation and saves time by preventing employees from asking the same questions again and again.
  • It is often kept as an addendum to the employee contract. Often, employees are made to sign it every year.

How to create a handbook?

Employee handbook topics are almost the same for all organizations in a particular jurisdiction. A handbook template can be purchased from a renowned vendor before establishing the policies.

Other expensive ways are hiring a HR consultant or an employment lawyer to create an employee handbook.

15. Guides for Managers:

These are documents provided to the managers. These documents contain resources, detailed procedures, and how-to guides on HR areas that concern managers, e.g. performance management and hiring.

Why Is Such a Guide Important?

  • This guide provides managers with a step-by-step procedure so that they are aware of the action they need to take at a certain point.
  • An inexperienced manager can use this guide as a help.
  • It makes sure that every manager is executing HR programs and policies in the same manner.
  • The guide protects the organization as it helps managers understand the various limitations that surround most HR decisions.
  • It trains the managers and communicates how things should be done.
  • It makes sure that the managers adhere to the values and culture of the organization.

How to Create a Guide: An HR consultant or an HR professional should be hired. He will study the employment philosophies of the organization and make a manager guide accordingly.

16. Reporting of Employee Data:

This document would record, maintain, and report all employee data.

Why is it needed?

As the organization grows, the ability of the HR department to accurately and quickly access employee data becomes crucial.

This is because the senior management team and the CEO would want to know the employee headcount, the employee turnover, the number of active employees etc.

They would also need to know the number of inactive employees or number of employees on leave, and the cost of compensation.

Employee data should also let them know about the frequency at which it changes like relocations, promotions, and transfers take place. The management needs to analyze employee data for making well-informed HR decisions.

How to Start?

All kinds of employee data can be included in an Excel workbook. This enables the HR department to quickly find any necessary information.

It also helps in analyzing and reporting. By having Excel as the employee database, money can be saved on unwieldy systems.

  • The process should begin with the payroll provider. The present available data like employee name, date of hiring, salary, etc should be downloaded and a spreadsheet should be created.
  • A form should be created with other updated employee data one requires. Such data includes level of education, emergency contacts, etc. This form should be circulated among employees who need to input the data.

With the above-mentioned documents, you can start a competent and efficient HR department.