Last Updated on September 4, 2026 by
What to ask any HR vendor before you sign – 2026 edition
*By HRTailor – the online HR department for startups & SMEs*
Use this before you commit to any HR outsourcing / payroll / compliance provider. If a vendor
can’t answer these clearly, keep looking.
1. Scope & ownership
- Do I get one named HR Manager, or a rotating support desk?
- Who is my point of contact, and what are their response times (SLA)?
- Is the scope end-to-end (setup + monthly ops + compliance), or only payroll?
- What is explicitly NOT included? (Get it in writing.)
- Who owns my data and documents if I leave? How is handover done?
2. Pricing transparency
- Is pricing fixed and published, or “custom quote” (a red flag for SMEs)?
- Are there setup fees, per-employee fees, or per-payslip charges?
- What triggers a price increase (headcount bands, add-ons)?
- Are statutory filings included, or billed per challan?
- Minimum contract term and exit notice period?
3. Statutory compliance (India, 2026)
- Do they handle PF, ESIC, PT, and LWF registration *and* monthly filings?
- Are they current on the 4 Labour Codes (in force since Nov 2025)?
- Do they ensure wages are structured ≥50% basic (Code on Wages)?
- Do they issue appointment letters (now mandatory)?
- Who bears the penalty if a filing is missed – them or you?
4. Payroll
- Cut-off dates, payslip delivery, and bank-upload process?
- TDS computation and Form 16 – included?
- Full & final settlement turnaround for exits?
- Can employees self-serve payslips / tax declarations (HRMS)?
5. Technology
- Is an HRMS included in the fee, or a separate licence?
- Attendance, leave, expenses, onboarding – all in one system?
- Can you export your data anytime, in standard formats?
6. People operations
- Onboarding & exit handled end-to-end?
- Grievance handling and POSH/ICC support?
- Policy framework + employee handbook setup?
- How are escalations handled when your manager is on leave?
7. Proof
- References from companies your size (1–100 employees)?
- Years in operation and penalty/dispute track record?
- Go-live timeline – and what happens if they slip?
How HRTailor answers all 21
One dedicated HR Manager + a 5–6 person pod + Cloud HRMS included, end-to-end setup
to monthly ops, fixed pricing from ₹10,000/month, full PF/ESIC/PT/LWF + Labour-Code compliance,
go-live in ~3 weeks. No hidden fees, no surprise compliance bills.
Book a 30-min call → hrtailor.com/contact-us/
Fill in your details and we'll email the checklist - 21 questions to ask any HR, payroll or compliance vendor before you sign. By downloading, you agree to receive occasional HR insights from HRTailor - unsubscribe anytime.
What the HR outsourcing buyer’s checklist covers
A shortlisted HR outsourcing provider looks great in a sales meeting. Six months in, missed EPF filings, contractor liability spillover and slow response times cost far more than the monthly bill. This checklist gives you a structured way to evaluate any Indian HR outsourcing partner before you sign.
The 5 evaluation areas inside
- Compliance coverage - Which states can they file in? PF, ESIC, PT, LWF, TDS, Shops & Establishment, contract labour? Track record on inspections?
- Technology & data - Do they run their own HRMS or use yours? Data ownership? Migration path if you switch later?
- Team & accountability - Named delivery lead? Backup coverage? Response time SLAs? Escalation matrix?
- Pricing transparency - Per-employee-per-month vs fixed? Onboarding/exit charges? Hidden costs?
- References & case studies - At least 3 SME references in your headcount band. Client tenure. Recent inspection wins.
The 3 biggest red flags
1. No compliance certificates from their own contractors. If they can’t produce monthly PF/ESIC certificates for their own team, they can’t guarantee it for yours.
2. Vague delivery lead. “Account team” or “customer success” without a named person means no one is accountable when payroll misses the 15th.
3. Cheapest quote wins. The Indian HR outsourcing market has a floor: below Rs 40 per employee per month, corners get cut. Below Rs 25, expect missed filings.
How to use this checklist
Download the PDF, use it as a scorecard when meeting 2 to 3 shortlisted partners, and require written answers to each question before the second meeting. Vendors who take a week to answer basic compliance questions are showing you what year-2 will look like.