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The Best Human Resources Software of 2021

By Skye Schooley,
business.com Staff
| Updated
Apr 27, 2021

HR software can simplify your human resource responsibilities. Learn what the best HR software options can do for your small business.
Best for Payroll
Visit Site
Four preset packages with add-ons
Comprehensive HR functions
Scalable HR software
Best for Remote Teams
Paychex Flex
Comprehensive mobile app
Third-party integrations
Easy-to-use dashboard
Best for Performance Management
BambooHR
Two preset plans with add-ons
Seven-day free trial
Easy-to-use dashboard
Best for Custom Workflows
Visit Site
Plans start at $5 per month
Self-service employee onboarding
Workflow automation
Best for Easy Implementation
Rippling
Plans start at $8 per month
Automated onboarding
Intuitive self-service dashboard
HR software can simplify your human resource responsibilities. Learn what the best HR software options can do for your small business.
 

The best human resources (HR) software streamlines functions like employee onboarding, payroll and benefits administration, time and attendance tracking, and employee performance management. It integrates seamlessly into hiring and operational workflows so that HR management is easy for not only HR leaders, but all employees. To help you choose the best HR software for your business, we examined several HR applications, evaluating each on its price, ease of use and valuable features.

Find the Right HR Software for Your Business

Fill out this questionnaire to find vendors that meet your needs.
How We Decided
Our team spends weeks evaluating dozens of business solutions to identify the best options. To stay current, our research is regularly updated.
26
Considered
13
Researched
13
Selected

Compare Our Best Picks

Company Rippling GoCo Gusto Paychex Flex BambooHR BerniePortal Cezanne HR Namely Paycor Sage Business Cloud SAP SuccessFactors Ultimate Software Workday
Best for Easy implementation Custom workflows Payroll Remote teams Performance management Employee onboarding International businesses Midsized businesses Service customization Growing businesses Employee experience Customer support Compensation management

Free trial (Y/N)?
(No. of days)

No No No No 7 days No No No No 14 days Yes No No
Pricing Starting at $8 per employee per month Starts at $5 per employee per month $39-$149 per month, plus $6-$12 per employee per month Rates are based on users and selected services Rates are based on users and selected services $0-$21 per employee per month Rates are based on users and selected services Rates are based on users and selected services Starting at $99 per month Rates are based on users and selected services Rates are based on users and selected services Rates are based on users and selected services Rates are based on users and selected services
Pricing tiers N/A One tier, plus add-ons Four tiers, plus add-ons One tier, plus add-ons Two tiers, plus add-ons Four tiers One tier, plus add-ons One tier, plus add-ons N/A N/A N/A N/A N/A
Contract Month to month Month to month, annual, and multiyear Month to month Month to month Month to month Month to month or annual Month to month Multiple contracts available Month to month or annual Month to month or annual Month to month Multiple contracts available Multiple contracts available
Software installation Cloud-based Cloud-based Cloud-based Cloud-based Cloud-based Cloud-based Cloud-based Cloud-based Cloud-based Cloud-based and on-premises Cloud-based Cloud-based Cloud-based
Payroll services Included Included and third party Included Included Included Third party Included and third party Included and third-party (for international payroll) Included Included and third-party Included Included and third-party Included
Integrations 500+ 15+ 70+ 190+ 50+ Yes 20+ 65+ 140+ 70+ Yes 250+ 115+
Mobile app iOS and Android iOS and Android iOS and Android iOS and Android iOS and Android iOS iOS and Android iOS and Android iOS and Android iOS and Android iOS and Android iOS and Android iOS and Android
Customer support Email and webchat (plus phone support with HR help desk add-on)

Phone and email; Mon-Fri, 9 a.m.-6 p.m. CST

(webchat support included with HR Support On Demand)

Phone, email and webchat; 8 a.m.-3 p.m. PST (4 p.m. for Concierge users)

24/7 phone and webchat

Phone and email; Mon-Fri, 6 a.m.-6 p.m. MST

Phone, email and webchat Email, ticketing and support portal

Phone, ticketing and webchat; Mon-Fri, 9 a.m.-9 p.m. EST

Phone, email, webchat, and one-on-one support; Mon-Fri, 8 a.m.-8 p.m. EST (payroll); 8 a.m.-6 p.m. EST (other products)

Phone, email and webchat; Sun-Sat, 9 a.m.-7 p.m. EST

24/7 phone, ticketing, webchat and support portal

24/7 phone, ticketing and online community 24/7 phone, webchat, online community and one-on-one support

Our Reviews

Gusto HR Software: Best HR Software for Payroll

Gusto offers comprehensive payroll and benefits administration features.
It integrates with more than 80 popular third-party applications.
It doesn't include performance management tools.
Visit Site

Gusto is our choice as the best HR software for payroll. Gusto's payroll features are robust. It offers nationwide full-service payroll functions, workers' compensation administration, and the Gusto Wallet app, which you employees use to access their payroll and account information.

Editor's Score: 9.3/10

With Gusto, you have access to unlimited and multistate payroll, tax filing and payments, direct deposit, state and federal unemployment insurance, year-end tax forms, garnishments, multiple pay rates and schedules, PTO policy management, holiday pay, and time-off tracking. It also offers reporting, accounting integrations, time tracking integrations, new-hire reporting and payroll reports.

When hiring and onboarding employees, you can access onboarding checklists, offer letters, e-sign documents, and document storage. You can use anonymous employee surveys and survey trend analyses to gauge employee satisfaction.

If you are looking to customize your software with integrated employee benefits, Gusto offers workers' compensation insurance, health insurance, health reimbursement, 401(k) retirement plans, 529 college savings plans, health savings accounts (HSAs), flexible spending accounts (FSAs) and commuter benefits. Gusto also offers licensed benefits advising, online enrollment, and complies with the Affordable Care Act (ACA), the Health Insurance Portability and Accountability Act, and ERISA (the Employee Retirement Income Security Act of 1974). Employees can access important payroll and benefit features like paystubs and tax information, payroll self-onboarding, and payday emails.

Gusto offers a contractor plan (the base fee is $0, but you pay $6 per month per contractor) and three different employee-based plans. (Plans range from $39 to $149 per month, plus $6 to $12 per month per employee).

Read Gusto HR Software Review

Paychex Flex: Best HR Software for Remote Teams

The Paychex dashboard is easy for administrators and employees alike to use.
The Paychex Flex mobile app gives users 24/7 access to their pay and benefits details.
Paychex Flex does not list pricing online.

Paychex Flex is our choice as the best HR software for remote teams. Paychex offers various payroll and HR options for businesses of any size, with its Paychex Flex Select plan that caters to smaller and midsized businesses, and its Paychex Flex Enterprise plan, which is suited for larger organizations. Each Paychex Flex plan has customized pricing based on your HR needs.

Editor's Score: 9.0/10

Since Paychex is a full-service solution, businesses can take advantage of features like new-hire reporting, time and attendance tracking, payroll processing, payroll tax management, and benefits administration. The software can integrate with several other third-party vendors, which is great for remote teams. Your HR department and other teams can track employee information and maintain legal compliance through data analytics, general ledger reports, and automatic W-2 and 1099 forms. There's even a labor compliance poster kit.

Keeping employees satisfied can be tricky, especially with so many teams working remotely – Paychex Flex can help with this by offering direct deposit and pay cards, employee financial wellness programs, employment and income verification services, and an e-learning management system.

One feature that sets Paychex Flex apart from its competition is its mobile capabilities: The free Paychex Flex mobile app is comprehensive, whereas most competitors limit the functionality of their mobile apps. This is great for on-the-go managers, remote employees and teams with flexible working arrangements.

Read Paychex Flex Review

BambooHR: Best HR Software for Performance Management

You can add performance management features to any BambooHR plan.
You can run customized reports so you can manage your business better.
BambooHR doesn't list pricing online, and some users say it can be expensive.

With its mobile-friendly platform, performance management add-ons, and employee self-service features, BambooHR is our choice as the best HR software for managing and tracking the performance of your employees. Depending on the plan you choose, the software allows for goal tracking, peer feedback, self and manager assessments, and employee and company performance reports. Additionally, you can see what employees think of your company by polling them with BambooHR's employee satisfaction surveys.

Editor's Score: 9.0/10

You have a choice of two plans: the Essentials or the Advantage plan, both of which are priced per employee and charged on a monthly basis with no contracts or cancellation fees. The platform is also customizable, with the ability to add features, such as performance management tools, payroll services and time-tracking features. You can test out the software with a seven-day free trial.

BambooHR users can access a plethora of essential HR management features, such as employee records and benefits tracking. You can also create workflows and approvals, which help you automate and streamline HR functions; audit trails, which are also available, help your organization comply with specific federal, state, and/or industry regulations.

Advantage users can access helpful hiring and onboarding features, complete with an applicant tracking system (ATS) and a BambooHR hiring app that allows your HR staff to manage employees. BambooHR also permits employee training tracking, which, for many organizations, ties in with performance management.

One feature that we liked about BambooHR was its employee self-service capabilities (e.g., time-off management, employee directory and organization chart, company calendar, mobile app, single sign-on). This allows employees to take more control over certain HR functions and minimizes friction throughout the HR management process.

Read BambooHR Review

GoCo: Best HR Software for Custom Workflows

GoCo automates and streamlines hiring and onboarding.
You can access an embedded payroll option or sync your current payroll solution with GoCo's software.
GoCo is compatible with a limited number of third-party app integrations.
Visit Site

GoCo is our choice as the best HR software for designing custom workflows. This easy-to-use software starts at $5 per employee per month. GoCo's Workflow add-on simplifies your company's HR processes by automating HR tasks. For example, you can streamline your onboarding process by standardizing new hire packets, training and orientation, and onboarding checklists. You can also automate offboarding checklists, travel and promotion requests, performance reviews, employee surveys, equipment requests, and expense reports.

Editor's Score: 9.1/10

Automating an HR process is as easy as creating a workflow template (e.g., create tasks, collect data, set due dates, customize permissions), collaborating with others (e.g., assigning tasks to others in the organization), and tracking workflows (e.g., viewing HR workflows on one dashboard).

Users can hire and onboard employees with customized offer letters, e-signatures and assigning onboarding tasks to other employees. To simplify the paperwork involved in filling out HR documents, employers can use the GoCo MagicDocs feature to digitize documents and add fillable forms that can be automatically merged into the employee's profile. With GoCo, you can customize the software with a variety of add-on features, like benefits administration, payroll, and time off and time tracking.

Read GoCo Review

Rippling: Best HR Software for Easy Implementation

Rippling can be implemented in less than four weeks.
It integrates with more than 400 applications.
You pay an additional monthly base fee for the HR help desk.

Rippling is the best HR solution for easy implementation. You can easily get your business up and running with Rippling and its workflow and approval automation tools and customizable features. Rippling's employee management platform starts at $8 per user per month, and you can add a variety of HR management features like applicant tracking, payroll, benefits administration, time and attendance, flex benefits, ACA and Consolidated Omnibus Budget Reconciliation Act (COBRA) administration, and an HR help desk.

Editor's Score: 9.2/10

Rippling says it takes users, on average, two and a half weeks to integrate the platform.

You can automate onboarding, offboarding, create workflows and approvals. With HR automation, your new hire is funneled through the onboarding process (e.g., offer letters, new-hire paperwork, background checks, e-verification). The automated process is seamless – Rippling says the average time it takes a new hire to complete onboarding is 90 seconds.

To further simplify your HR needs, you can automate other processes like time and attendance, applicant tracking, and ACA and COBRA administration. Rippling comes with customizable reporting, an open API, and more than 400 third-party integrations.

The Rippling platform is intuitive and easy to use; you can contact customer support for their help and guidance in answering questions about the software or HR issues. If you want one-on-one email and phone support, you can add the HR help desk feature to reach certified HR pros and get real-time compliance updates. Rippling has a mobile app for iOS and Android devices.

Read Rippling Review

BerniePortal: Best HR Software for Employee Onboarding

Employers can create customized onboarding documents and agreements.
Employers can require employee signatures and download proof of review/agreement.
BerniePortal does not have a mobile app for Android.

With its applicant-tracking capabilities, onboarding checklists, and customized onboarding documents and agreements, BerniePortal is our choice as the best HR software for employee onboarding.

Editor's Score: 8.5/10

BerniePortal has a plan to fit any sized business. There is a free plan, as well as paid plans that range from $9 to $21 per employee per month.

The features of each plan are tiered, although every paid plan comes with most of the applicant-tracking and onboarding features. Some of the features you get with BerniePortal, for example, include custom prescreening questions, candidate and internal messaging capabilities, custom job posting hyperlinks, and a range of reports.

Besides the ability to track applicants throughout the recruiting process, BerniePortal has several onboarding features to help you integrate new employees into your organization. You can create to-do checklists, access state and federal forms with e-signature capabilities, gather employee direct deposit information, and create custom onboarding documents and agreements. What's more, you can create custom fields and download employee responses into usable reports.

These days, the onboarding process entails setting up employees with their benefits. BerniePortal lets you list all of your company benefits in one centralized location during open enrollment, enabling new hires to make benefit elections and allowing employees to modify their benefits when they have a qualifying life event.

BerniePortal has paid time off (PTO) and time-tracking features, so new employees can clock in and get paid accordingly. If you are onboarding different types of employees(e.g., exempt and nonexempt), you can create subgroups for PTO and clock-in allowances. If you are looking for further HR software customization, BerniePortal has an open API for platform integrations.

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Cezanne HR: Best HR Software for International Businesses

Cezanne HR's features can be customized based on the country you operate in.
Cezanne HR supports SMS text messaging in more than 120 countries.
Phone support is not offered.

With its free language translations, global HR capabilities, and multicurrency recording, Cezanne HR is our choice as the best HR software for international businesses. Cezanne HR caters to U.K. and international organizations with 100 to 3,000 employees. Pricing is based on what features you need and how many employees you have.

Editor's Score: 8.4/10

Cezanne HR's core people management module comes with a plethora of HR features. You can access employee profiles, salary and bonuses (in any currency), digitized legal documents, training and development plans, and company asset tracking records. The easy-to-use dashboard can be tailored and branded to match your company, and you can combine integrated workflows (with rules and reporting) to receive automatic notifications. Cezanne HR supports SMS text messaging in more than 120 countries.

Part of why we selected Cezanne HR is due to its focus on providing global HR solutions and international HR management. In addition to supporting multiple languages and currencies, it can support localized features based on whatever region or country you are based in or need. For example, it offers local calendars, configurable working processes, regional portals, localization (content translation), country-specific compliance and configurable security permissions.

Cezanne HR users can add other essential HR features for recruitment, onboarding, career and succession planning, payroll, time tracking, absence management and performance management. Its security protocols help companies comply with a range of regulations, and its integration features allow you to further customize the software to meet your needs. 

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Namely: Best HR Software for Midsized Businesses

You can customize Namely to suit your business's HR processes.
The software is incredibly easy for employees to use.
Namely does not disclose its pricing online ‒ you need to call to get a quote.

Namely is a comprehensive, full-service HR software that comes with multiple software options for businesses between 50 and 1,000 employees. Namely's HR platform includes workforce management and benefits administration, as well as the ability to customize the software for your specific needs. Namely is our choice as the best HR software for midsized businesses.

Editor's Score: 8.6/10

The software offers the tools your business needs to grow further. These tools include configurable job applications, resume parsing, automated background checks, paperless processing and custom job workflows. When new employees are hired, Namely helps you administer employee benefits and manage payroll. Additionally, Namely can help you accurately track time and attendance and pull hours from employee timesheets into your payroll software. If your organization needs enhanced services, such as managed payroll and employee benefits offerings, Namely offers these services as well.

As your business grows from a small to midsized company, employee performance can become more difficult to track and maintain. Namely can solve this with features like goal management, automated review cycles, configurable templates and unlimited performance assessments. The platform also helps you improve workforce engagement by offering user-friendly software with company news feeds, employee self-service features, and mobile accessibility.

Namely integrates with other business solutions, and it offers reporting and analytics based on a wealth of HR data. It offers compliance packages that are great for midsize businesses to help them manage potential risks and demonstrate compliance with regulations.

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Paycor: Best HR Software for Service Customization

The software is intuitive and easy to navigate.
Businesses in the healthcare, manufacturing, restaurant, retail, professional services and education industries are ideally suited for Paycor, as are nonprofits.
Paycor does not list pricing online.

Paycor is our choice as the best HR software for service customization. The platform, which can cater to businesses of all sizes, best serves nonprofits and companies based in the healthcare, manufacturing, restaurant, retail, professional services, and education industries. Since Paycor is full-service human capital management (HCM) software, it offers a variety of features for HR, payroll, benefits administration, talent and workforce management, and employee engagement.

Editor's Score: 8.8/10

Paycor can customize an HR solution to meet your business's needs – you will select your company size and then choose your payroll bundle (which starts at $99 per month). The next step is where Paycor makes it easy to customize your HR solution.

You can then select the specific HR features you need, and Paycor will create a custom quote for you. These features can include recruiting and applicant tracking, onboarding, benefits administration, time tracking, compensation planning, an LMS, and wage garnishments.

Paycor's customization makes it easy for businesses to create a solution that only contains the features they need. The platform comes with an intuitive dashboard, employee self-service features and a mobile app. If you need assistance customizing your plan, you can reach out to a representative via phone, email or webchat.

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Sage Business Cloud: Best HR Software for Growing Businesses

Sage Business Cloud offers HR solutions for businesses of any size.
Sage integrates with third-party applications.
Some users say Sage Business Cloud People can take a while to set up.

Sage Business Cloud offers software and services for businesses of all sizes and is our choice as the best HR software for growing organizations. Whether you are running a new startup or managing a busy, midsized business, Sage Business Cloud has accounting, finance, payroll, customer relationship management and HR tools to fit your needs.

Editor's Score: 8.4/10

Regarding HR and people management specifically, Sage has a few different cloud-based and on-premises products for businesses to choose from: Sage HRMS, Sage HR (formerly CakeHR) and Sage Business Cloud People. Each product varies in terms of features and pricing and can be customized to fit your needs. Plans are scalable as your business grows.

You can, with Sage, take advantage of essential HR functions like recruiting and onboarding, benefits administration, time and attendance tracking, and automated workflows. You can integrate Sage software with a variety of payroll and benefit carriers, as well as other third-party applications.

Sage has a mobile app for both iOS and Android. There is a self-service portal so anyone on your expanding team can conveniently access their HR data. Sage offers analytics and reporting tools, so you can see how well your team is performing.

If you have questions regarding Sage Business Cloud, representatives can be reached by phone or online. Continued education and e-learning are available with Sage University, which is great for new and current employees to stay up to date with training and certifications.

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SAP SuccessFactors: Best HR Software for Employee Experience

SAP offers goal setting, 360-degree feedback and customizable dashboards.
SAP SuccessFactors supports local and global workforces.
The integration capabilities can be limited.

SAP SuccessFactors' HR solution offers the best employee experience. SAP understands that your employees are the key to your organization's success, so it offers features that help you manage and improve their overall experience when using HR software.

Editor's Score: 8.0/10

SAP offers time and attendance tracking, global benefits management, payroll monitoring and processing, and can automate HR processes. It also offers HR analytics and customizable reports, which are great for tracking employee performance. Since SAP SuccessFactors has self-service features and mobile apps for iOS and Android, employees can gain access to their HR information whenever they need to.

SuccessFactors offers an employee experience management platform as well. You gain access to a wealth of features like flexible surveys, 360-degree feedback, configurable questions and workflows, qualitative feedback, and customizable dashboards.

Your employees' experience can also be heightened by the ability to continue their education. SAP offers a learning hub and training courses as a way for employees to keep their skills current and gain certification.

If you have questions regarding the software, SAP has a wealth of online community resources and a support portal. You can also contact a representative by phone, contact form or webchat.

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Ultimate Software: Best HR Software for Customer Support

UKG's platform is very user-friendly. Employees can quickly and easily update their information.
UKG has a wealth of online support, like a learning center and communities.
Customizing reports is not as intuitive as other platforms.

Ultimate Software UltiPro, which is now UKG Pro under the UKG brand, is our choice as the best HR software for customer support. HR software is an integral business solution, and having great customer support when you need it can make a big difference in the success and usability of the software. UKG understands this and is there to offer friendly and informative assistance when needed. Representatives can be reached 24/7 by phone and an online contact form.

Editor's Score: 8.1/10

You can also schedule demos and Q&A sessions, or access one of the many online product tours to learn about how the software can impact your business. If you want to learn more about UKG on your own, the company makes it easy with online resources like blogs, infographics, interactive content, videos, webcasts and white papers.

UKG offers essential HR functions like recruiting, onboarding, benefits administration, open enrollment, payroll administration, time and attendance tracking, document management, employee scheduling, tax management, employee surveys, and global compliance. You can track and manage employee success with tools for career development and performance management. UKG integrates with other applications, and it gives users HR insight with reporting functionality and workforce analytics.

The software can be tapped into via a mobile app, which gives users access to their HR data wherever they are. Data is synchronized to the app in real time, and it is secured with touch and facial recognition. Users can access details like payment details, pay history and pay insights.

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Workday: Best HR Software for Compensation Management

Using Workday, you can create compensation plans based on real-time insights.
Workday integrates with several third-party applications.
Workday does not list pricing online; some say it can be expensive for small businesses.

Workday is our choice as the best HR software for compensation management because it gives users the ability to create award budgets, configure and distribute budget pools, and process compensation-related events. Workday is ideal for nonprofits and businesses in a variety of industries, such as communications, energy and resources, financial services, government, healthcare, education, hospitality, insurance, life sciences, manufacturing, media and entertainment, and professional services.

Editor's Score: 8.3/10

Workday can help you manage your HR functions; its features include benefits administration, time and attendance tracking, global labor cost management, mobile clock-in with geofencing, payroll coordination, reporting and analytics, and legal compliance. It also has several in-house and third-party integrations.

One feature we particularly liked about Workday was its compensation management capability. Instead of having to manually administer and manage various compensation plans across your organization, Workday alleviates the challenge and streamlines the process. Administrators can use real-time data to configure automated compensation packages based on factors like salary, commission, merit and triggers. You can even use flexible location profiles and currency options if you have a global workforce.

Workday is cloud-hosted and compatible across all devices. There are also iOS and Android apps, so employees can view their compensation at any time or location. The software is available via customizable plans and pricing, and users can access online demos to get a feel for how it works.

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How Much Does HR Software Cost?

The cost of HR software varies depending on the size of your business, your industry and the features you need. Most HR software pricing is based on a per-employee basis, averaging between $5 and $20 per employee per month. Some HR software providers also charge a monthly base fee, ranging roughly between $40 and $150 per month. Additionally, you may have to pay for extra features like payroll capabilities and employee benefits.

Some HR software solutions are on a month-to-month basis with no long-term requirements, while others require that you sign an annual contract.  

Although free trials and free plans are uncommon with HR software, most companies offer either an online demo or a demo that you can schedule with a company rep to walk through all of the software's features.

Bottom LineBottom line: The average HR software program costs between $5 and $20 per employee per month, plus a monthly base fee that can be $40 up to $150. Other features like payroll and employee benefits often cost extra.

Buying Guide

What Is HR Software?

Human resources software helps businesses recruit, onboard and manage employees. It integrates time scheduling and management tools to organize a company's workforce; its payroll features accurately compensate employees; and performance management and reporting features facilitate and track employee development.

When conducting your research about HR software, you likely came across terms like "human resources information systems (HRIS)," "human resource management systems (HRMS)," or "human capital management (HCM)" – although these terms sound different, they all refer to HR software.

What HR Software Can Do for Your Company

Small business owners and HR professionals know how time-consuming HR management can be. Although employers were previously limited to manually performing HR functions, human resource software has automated and simplified the process. Some companies offer specific types of HR software, like those for recruiting, employee scheduling, and time and attendance, while others offer comprehensive HR solutions to handle nearly every aspect of workforce management.

The best HR solutions streamline employee recruiting, automate onboarding and offboarding, administer and track employee payroll and benefits, and manage employee attendance and performance. Additionally, HR technology can help your company comply with employment and labor laws.

Did you know?Did you know? HR software with automated workflows is not only great for speeding up your HR processes, but it can also help you comply with many federal and state regulations.

These solutions can also provide great insight into your workforce. All HR software offers reports that provide a treasure trove of data that can be used to improve underperforming areas.

Most of today's HR software is cloud-based. The self-service portals and intuitive dashboards make it easy for employees to take control of HR-related functions like managing benefits and compensation, requesting time off, and accessing performance reviews.  

Standard Features in HR Software

The features available in each HR software package can vary, but here are some standard ones that most providers offer.

  • Recruiting and onboarding: Tools used to recruit, onboard and offboard employees are commonly found in most HR software. These features include job posting and syndication, configurable job applications, interview and assessment functionality, offer letter templates, new hire packets, e-signatures capabilities, workflow automation, and training tracking.

  • Payroll: Most HR software either comes with a built-in payroll option, or it integrates with third-party payroll software. Built-in payroll modules typically include the ability to accurately calculate employee paychecks, pay employees via direct deposit, handle all payroll tax responsibilities and provide online pay stubs.

  • Time and attendance: Many HR software options include time and attendance systems so employers can accurately track when employees are on and off the clock. These systems also manage paid time-off requests and accruals. This data is automatically synced into payroll solutions to streamline payroll processing.

  • Benefits administration: HR software can help companies administer employee benefits like medical, dental, and vision insurance; employee retirement accounts; life insurance; short- and long-term disability insurance; HSAs; and FSAs.
  • Performance management: Standard HR software allows you to track and manage employee performance. This can include tools for goal setting and monitoring, succession planning and performance evaluations. They can also include personalized dashboards and learning management systems with training courses so you can easily provide mandatory (sexual harassment) training or professional development training.

  • Legal compliance: HR software helps you maintain audit-ready records and compliance with employment and labor laws such as the ACA and COBRA.
  • Reporting: Most HR software provides helpful reporting and analytics. You may, depending on the type of reports you want, have to sign up for a more advanced software plan, but basic plans typically provide data on your team, payroll, taxes and more.
  • Self-service dashboard: Employees can use the software to access a self-service dashboard to manage their benefits, request time off and complete their performance evaluations. Since most systems are cloud-based and offer mobile apps for iOS and Android devices, employees can access the software wherever they have an internet connection.

How to Choose the Right HR Software for Your Small Business

The right HR software package for your company depends on the functions you want to streamline and how the solution will complement other software programs your company is already using. Some businesses need a comprehensive, full-service HR platform to manage all aspects of HR, whereas others may want specialized software to help with one or two aspects of HR.

A key factor to consider is the software's integration capabilities, primarily if you are already using programs that perform some HR functions. For example, if you need a solution to help onboard and manage employees but want to keep your current payroll system, you want employee onboarding HR software that integrates with your current payroll platform.

TipTip: Identify which business platforms you currently use before choosing an HR software program. This will help you select HR software that is compatible with your business needs.

Small businesses should also pay attention to platform functionality. It should be intuitive and easy for the whole team to use. Customer support is also important. Since HR software handles a lot of the critical functions of running a business, you want to make sure help is available when you need it, regardless of whether it is in the middle of a workday, at night or over the weekend.

Cost and contractual obligations are other key aspects to consider. Some HR software allows you to use their services on a month-to-month basis, while others require you to sign an annual contract.

HR Software FAQs

HOW CAN HR SOFTWARE HELP YOUR COMPANY'S BOTTOM LINE?

By automating your HR processes, human resource software saves your HR team time that they would otherwise spend manually performing administrative functions. This gives your HR department more time to execute other important tasks. In addition, most HR software helps you comply with federal, state and local laws, which can reduce the possibility of costly legal issues. 

WHAT SHOULD YOU LOOK FOR IN AN HR SOFTWARE PACKAGE?

Making sure the solution has all of the functionality and features your team needs is of critical importance when looking for HR management software. Are you in need of a recruiting, applicant tracking and onboarding solution? Do you need payroll, time and attendance tracking, and benefits administration? Analyze your current HR process to determine which functions you want the HR software to manage.

If the HR software package is missing a few of the features you want, ask the vendors you're considering if the solution will at least integrate with other platforms that fulfill those needs. Additional features to look for in an HR software package are reporting and analytics capabilities to track your processes, a self-service portal for employees to access and manage their information, a mobile app, and great customer support. 

HOW DO YOU KNOW WHEN YOUR SMALL BUSINESS NEEDS AN HR SOFTWARE SOLUTION?

If you are a small startup with a few employees or you can easily manage all of your HR tasks by hand, you may be fine handling all of your HR responsibilities manually. However, as soon as your HR functions take up too much time or you expand, it is time to invest in HR software.

Regardless of how small or large your business is, HR software is a great way to streamline common core HR tasks like record keeping, payroll and talent management. It is also a great way to help your business maintain compliance with employment and labor laws.

If your business needs help with any of these functions, consider getting an HR software solution. 

WHAT DO THE BEST HR SOFTWARE SOLUTIONS HAVE IN COMMON?

The best HR software solutions automate and streamline your HR processes. Not only do they help with recruiting, onboarding, employee engagement, administrative tasks, time tracking, employee compensation, and benefits administration, but they also allow you to comply with employment and labor laws.

The best HR solutions are cloud-based and intuitive, they come with easy-to-use dashboards and mobile applications, and they provide quick and responsive customer support.  

WHAT SPECIAL FEATURES CAN YOU ADD TO HR SOFTWARE PACKAGES TO CUSTOMIZE THEM TO YOUR NEEDS?

Many HR software solutions provide preset service plans; some companies let you add customizable features – this is a great option for small businesses that only need specific HR management functions.

For example, you may be able to add on components like payroll, benefits administration, time tracking, performance management, learning management systems, advanced HR support and advisory services. Some providers even offer industry-specific HR software that is customized to each business's unique needs.

Skye Schooley
Skye Schooley
business.com Staff
See Skye Schooley's Profile
Skye Schooley is a staff writer at business.com and Business News Daily, where she has written more than 200 articles on B2B-focused topics including human resources operations, management leadership, and business technology. In addition to researching and analyzing products that help business owners launch and grow their business, Skye writes on topics aimed at building better professional culture, like protecting employee privacy, managing human capital, improving communication, and fostering workplace diversity and culture.
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