When should we plan our 2026 hiring budget?

Ideally, this is done in Q4, but finalizing it in January is critical. Review salary benchmarks for 2026 (inflation adjustments), factor in software license costs for new hires, and allocate budget for recruitment marketing.

New Year HR Planning Guide: Q1 Strategy

Q: What should HR prioritize in Q1 2026?

Top priorities for Q1 2026 include updating labor law posters and handbooks for new regulations, finalizing the annual hiring plan, auditing software subscriptions for usage, and setting employee performance goals for the year.

Q: How do I audit my HR tech stack?

Start by listing all paid tools. Check user adoption (who actually logs in?). Identify redundant features (e.g., paying for Zoom and Slack video calls). Survey employees on satisfaction. Cancel tools with low ROI and consolidate where possible.

Q1 is Make or Break for HR

January isn't just another month in HR. It's the foundation. It's when compliance updates hit, budgets are unlocked, and hiring plans go live. If you start Q1 disorganized, you'll be playing catch-up until December.

We've created this strategic checklist to help People Leaders move from "reactive firefighting" to "proactive planning" for 2026.

Phase 1: The "Must-Do" Compliance Audit

Deadline: January 31st

Before you get to the fun stuff (culture! hiring!), you have to protect the business. 2026 brings new regulations in many states regarding pay transparency and AI in hiring.

✅ Compliance Checklist

▢ Update Labor Law Posters: Ensure 2026 versions are posted (physical and digital for remote staff).
▢ Review Employee Handbook: Update policies for new state laws (e.g., PTO rollover limits, bereavement leave).
▢ Audit Employee Classifications: Double-check exempt vs. non-exempt status to avoid wage theft lawsuits.
▢ Data Clean-up: Archive termed employees and update emergency contacts.

Recommended Tool: BambooHR or Rippling (both automate compliance updates). If you have contractors, use Deel to audit misclassification risk.

Phase 2: The Tech Stack Audit

Deadline: February 15th

You are likely paying for software nobody uses. Q1 is the time to audit your subscriptions. Are you paying for a standalone engagement tool like Culture Amp when your HRIS (like Hibob or Lattice) already does it?

✅ Tech Stack Checklist

▢ List All Tools: HRIS, ATS, Payroll, Performance, Engagement, Learning.
▢ Check Adoption: Pull login logs. If usage is < 30%, cancel it or re-train.
▢ Identify Redundancy: Do you have Slack, Teams, AND Zoom? Pick one.
▢ Renegotiate: Ask vendors for annual prepay discounts (usually saves 10-20%).

Pro Tip: If you are juggling 5+ disjointed tools, 2026 might be the year to consolidate into an "All-in-One" suite like Rippling or BambooHR.

Phase 3: Hiring & Headcount Planning

Deadline: February 28th

Don't just take the hiring plan from Finance. Sanity check it against market reality. Is the budget for that Senior Engineer role realistic in 2026?

✅ Hiring Checklist

▢ Benchmark Salaries: Use 2026 data, not 2024 data. Inflation has shifted bands.
▢ Update Job Descriptions: Remove biased language. Add AI policy if relevant.
▢ Review ATS: Is your ATS ready for volume? Check automated email templates.
▢ Employer Brand: Refresh your "Careers" page photos. Nobody wants to see Zoom screenshots from 2020 anymore.

Phase 4: Culture & Engagement Strategy

Deadline: Ongoing / Q1 Launch

January is the time to set the "vibe" for the year. Post-holiday blues are real. Give the team something to look forward to.

Launch Q1 Survey: Use a simple eNPS survey to take the temperature.
Performance Review Cycle: If you do annual reviews, launch them now (or finish them).
L&D Budget: Announce learning stipends early so people can plan conferences.

Recommended Tool: Lattice for goal setting (OKRs) and performance reviews.

Comparison: Planning Tools vs. Spreadsheets

Task	Using Spreadsheets	Using HR Software
Headcount Planning	Static, quickly outdated	Live org charts (e.g., ChartHop)
Compliance Audits	Manual Google searches	Automated alerts (Rippling)
Budgeting	Error-prone formulas	Forecast modeling

Frequently Asked Questions

What should HR prioritize in Q1 2026?

Compliance and Hiring. Ensure you aren't breaking new laws, then ensure you have the budget and tools to hit your hiring targets. Everything else comes second.

How do I audit my HR tech stack?

Start with a usage audit. Pull login reports. If a tool costs $10k/year and only 5 people logged in last month, cut it. Consolidate overlapping tools (e.g., using Slack huddles instead of Zoom).

When should we plan our hiring budget?

Ideally in Q4 of the previous year. If you haven't done it yet, do it now. Recruiting takes time; if you approve a role in March, they might not start until May. Start early.

New Year HR Planning Guide (2026 Edition)