UAE Startup HR Setup: Complete Guide to Building HR from Scratch 2025

Corporate bank account is critical with variable cost. WPS registration is critical and free with bank. Health insurance provider is critical with quote-based cost. HR file system is high priority at free to AED 200 per month. Standard templates are high priority at free to AED 5,000.

Requirements include trade license, Memorandum of Association, passport copies of shareholders, and proof of address. Timeline is 2-8 weeks depending on bank. WPS capability must be confirmed that bank offers WPS services. Recommended banks for startups: RAKBANK good for SMEs, Mashreq has Neo options available, Emirates NBD has largest network, CBD has competitive fees.

Before hiring get quotes from 3+ providers, compare coverage versus cost, understand DHA or DOH minimum requirements, choose provider, and know enrollment process. Minimum coverage requirements include inpatient care, outpatient care usually, emergency services, and maternity for female employees.

Google Drive or Dropbox is free and best for 1-3 employees. Basic HR software at AED 100-300 per month for 4-15 employees. Full HRMS at AED 300-1,000 per month for 15+ employees. Folder structure should be HR with subfolders for Employees containing name folders with Contract, Visa Documents, Performance, and Leave Records, plus Policies, Templates, Payroll, and Compliance folders.

Offer letter template for standardized offers. Employment contract for MOHRE compliance. Employee data form to collect all info. Onboarding checklist for consistent process. Leave request form to track time off. Expense claim form to process expenses. Exit checklist for proper offboarding.

Must have policies: Working hours covering 8 hours per day, 48 hours per week, and Ramadan reduction. Leave policy covering annual, sick, maternity or parental, and other. Probation covering terms, evaluation, and termination. Code of conduct with basic expectations. Can wait but draft soon: overtime policy, remote work policy, expense policy, performance review process, grievance procedure.

Monthly steps: Calculate pay by 25th including basic plus allowances, overtime if any, and deductions. Generate SIF file by 28th using bank portal or HR software and verify employee details. Transfer salaries by 30th or 1st through WPS before 15th of following month. Distribute payslips via email or HR system and keep copies.

At this stage you need HR software with basic HRMS, structured onboarding with documented process, policy documentation in basic employee handbook, and performance process with regular check-ins.

Key features for startups: UAE compliance with WPS, gratuity, and leave rules. Employee self-service to reduce admin time. Leave management for accurate tracking. Payroll or integration for error reduction. Mobile access for on-the-go management. Scalability to grow without switching. Budget: Basic tier AED 200-500 monthly for core HR and leave. Standard tier AED 500-1,000 monthly adds payroll and attendance. Premium tier AED 1,000-2,000 monthly adds performance and recruitment.

Contents for early stage: Welcome and company overview. Employment terms covering contract types, probation period, and working hours. Compensation covering pay schedule and overtime. Time off covering annual leave, sick leave, and public holidays. Workplace conduct covering expectations and dress code if any. Leaving the company covering notice periods and exit process. Length of 10-15 pages is sufficient at this stage.

Quarterly check-ins cover: Wins asking what went well. Challenges asking what was difficult. Goals for next quarter priorities. Development for skills to build. Documentation uses simple form or notes in HR system.

Components needed: HR ownership by assigning HR responsibility even if part-time. Complete policy set. Integrated HR platform. Documented procedures.

Founder handles at time cost is not recommended at this stage. Office manager plus HR at AED 8,000-12,000 salary for dual role. Part-time HR at AED 4,000-8,000 for limited needs. HR generalist at AED 8,000-15,000 salary for full focus. Outsourced HR at AED 3,000-8,000 for variable needs.

Required policies: Employment terms, compensation and benefits, leave policies all types, working hours and overtime, code of conduct, anti-harassment, grievance procedure, disciplinary procedure, health and safety, termination and resignation, data protection. Good to have: Remote work policy, travel and expense, training and development, social media, confidentiality.

When approaching 50 employees: Start planning at 40 employees. Track headcount monitoring skilled employee count. Register with Nafis creating employer account. Start hiring Emiratis before mandatory. Use subsidies up to AED 8,000 per month per Emirati. Track compliance with monthly monitoring.

Documents use Google Drive free. Spreadsheets use Google Sheets free. Communication uses WhatsApp or Slack free. Contracts use Word or Docs templates free. Payroll uses bank WPS plus spreadsheet free. Total AED 0 per month.

HR system uses basic HRMS at AED 200-500. Leave tracking included in HRMS. Document storage included or Drive. Communication uses Slack or Teams at AED 0-200. Total AED 200-700 per month.

Full HRMS comprehensive platform at AED 500-1,500. Payroll included or integrated. Attendance integrated. Recruitment ATS basic at AED 200-500. Total AED 700-2,000 per month.

Enterprise HRMS full suite at AED 1,500-5,000. Advanced analytics included. Performance included. Learning LMS at AED 500-1,000. Total AED 2,000-6,000 per month.

Mistake is verbal agreements or delayed contracts. Impact is no legal protection and visa issues. Solution is register contracts before work starts.

Mistake is CEO doing payroll at 20 employees. Impact is founder time wasted and errors increase. Solution is hire or outsource by 10-15 employees.

Mistake is no provisions for gratuity. Impact is cash flow crisis when employees leave. Solution is provision 5.8% of basic monthly.

Mistake is different rules for different people. Impact is legal exposure and morale issues. Solution is document and apply consistently.

Mistake is paying late due to cash flow. Impact is WPS violations, fines, and complaints. Solution is payroll is priority number 1.