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Still thinking HR technology is a"nice-to-have" in a startup?

Updated: Oct 7, 2021

Many start-ups I’ve worked with over a 20-year career often don’t bother much with an HR database. Information about their people will be in a variety of spreadsheets, paper files, or, in many cases – there’s hardly any record of someone’s employment beyond a few old payslips. Some businesses say that’s sufficient for them.

But what happens when the start-up grows?

And what are the legal requirements of employing people?

I’ve worked with many companies who are experiencing “growing pains” e.g. they now employ 20+ people and are growing rapidly but still have the culture of a start-up in a back bedroom. All too soon, the current paper/spreadsheet/filing cabinet system becomes difficult to manage and keep on top of. Even more so now where more people will be working remotely, and having a few paper records in a filing cabinet isn’t the most efficient way of being able to access data when you need it.

Here’s where using some smart technology can really help you, and if you put this in place now, it’s far quicker than waiting until everything gets out of control and trying to gather data from various manual sources.

Legally you should store specific documents relevant to someone’s employment in a secure location and in a way that’s compliant with the General Data Protection Regulations.

Relevant documents that you should store could include:

  • Job Application Form, CV, Job description

  • Offer Letter and Contract of Employment

  • Emergency Contact Information

  • Training Records

  • Copies of certificates/qualifications relevant to the role

  • Payroll and benefits information

  • Annual Leave & Sickness records

  • Proof of right to work in the UK

  • Disciplinary/Grievance Records

  • Copies of resignation letter

Here’s where having an HR database can really help you as you are able to access key information about your employees from anywhere, and it can help to automate previously labour-intensive tasks, and can also be used to give you key insights about your workforce.

There are lots of different products on the market and not all options have to be expensive. As a start-up, you don’t also have to buy systems with lots of features that you’ll never use due to your size.

However, here’s a checklist of things to think about when purchasing a system:

1 · Consider what you want it to actually do; who will use it and how they will access it.

2 · Look at whether you want it to link in with or be part of a wider payroll system, or if these two systems will be kept separate. There are arguments for and against either option.

3 · Go through a proper tender/bid process with 2-3 of your favourite systems before making a final decision.

4 · Get the salesperson to demonstrate the system to you by getting them to talk you through how they would deal with a particular scenario that you will use the system for. Many people will tell you the system can make the tea if they think it will get you to buy – so don’t just sit there stunned during a demonstration – have lots of questions ready.

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