10 Best HR Software for Small Businesses Shortlist
Here's my pick of the 10 best software from the 20 tools reviewed.
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With so many different HR software for small businesses available, figuring out which is right for you is tough. You know you want to automate and manage employee-related tasks like recruitment, payroll, performance tracking, and benefits administration, but need to figure out which tool is best. In this post, I'll help make your choice easy, sharing my personal experiences using dozens of different HR software with small teams and projects, and providing my picks of the best HR software for small businesses overall.
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Best HR Software for Small Business Comparison Chart
Here’s a comparison chart that summarizes basic details about each of my top HR software selections. You can view pricing details and the availability of free trials or demos side-by-side to help you find the best HR software for your budget and business needs.
| Tools | Price | |
|---|---|---|
| Deel | Flat rate user pricing, with free HR tool for businesses | Website |
| Rippling | From $8/month/user | Website |
| Greenhouse | Pricing upon request | Website |
| BambooHR | Pricing upon request | Website |
| Paycor | From $5/employee/month + $99/month base fee | Website |
| Oyster HR | From $499/employee/month or $29/contractor/month | Website |
| Paychex Flex | From $39/month + $5/employee/month | Website |
| Remofirst | From $199/employee/month for EOR and $25/mo for contractors | Website |
| Bambee | From $99/month | Website |
| Homebase | From $20/month (payroll add-on is $6/user/month + $39/month) | Website |
Compare Software Specs Side by Side
Use our comparison chart to review and evaluate software specs side-by-side.
Compare SoftwareHow to Choose HR Software
HR software can help small businesses solve many different challenges and improve numerous workflows. To help you figure out which HR software best fits your small business needs, you need to pinpoint your key users and document their specific challenges first.
As you work through your own unique HR software selection process, keep the following points in mind:
- What problem are you trying to solve - Start by identifying the challenges you're trying to overcome. This will help you clarify the features and functionalities the HR software needs to provide.
- Who will need to use it - To evaluate cost and requirements, consider who will use the software and how many licenses you'll need. You'll need to evaluate if it'll just be your senior HR professionals who need access or your entire department. Once that's clear, it's also useful to rank the needs of your different users to identify your key priorities for your HR software power users, managers, and employees, to ensure they're all met.
- What other tools it needs to work with - Clarify what tools you're replacing, what tools are staying, and the tools you'll need to integrate with, such as accounting, time-tracking, or payroll software. You'll need to decide if the tools will need to integrate together, or alternatively, if you can replace multiple tools with an all-in-one HR platform.
- What outcomes are important - Review the capabilities you want to gain or improve, and how you will measure success. For example, you may want to provide a more enriched employee experience through increased self-service abilities, improve employee engagement by increasing team recognition capabilities, or streamline your leave approval process. You could compare HR software features until you’re blue in the face but if you aren’t thinking about the outcomes you want to achieve, you could waste a lot of valuable time.
- How it would work within your organization - Consider the software selection alongside your existing workflows and systems. Evaluate what's working well, and any problem areas that need to be addressed.
Remember every business is different — don’t assume that an HR system will work for your small business just because it's popular.
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Deel
Visit WebsiteThis is an aggregated rating for this tool including ratings from Crozdesk users and ratings from other sites.4.8 -
Paycor
Visit WebsiteThis is an aggregated rating for this tool including ratings from Crozdesk users and ratings from other sites.4.1 -
Paychex Flex
Visit WebsiteThis is an aggregated rating for this tool including ratings from Crozdesk users and ratings from other sites.4.2
Reviews of the Best HR Software for Small Businesses
Here you’ll find my overviews of the 10 best HR software I selected specifically for small and midsize businesses. In my research, I kept core HR challenges of SMBs in mind, like hiring and retaining top talent, ensuring legal compliance, and driving professional development. I’ve outlined each provider’s best use case, standout features, and pricing information.
Deel is a comprehensive HR platform designed for businesses of all sizes. For small businesses and startups, Deel has made their new HR tools free, so it’s an excellent option for onboarding and managing additional help. Furthermore, Deel’s global compatibility lets you hire and manage freelancers and employees in 150+ countries without having to figure out local laws, tax systems, or international payroll management.
The Deel platform is user-friendly and integrates several features that make it easy to manage and pay workers compliantly without juggling multiple tools. Included for every client are features like contract and stock option management, expense reimbursements, and compliance documentation tracking.
Employees and contractors can self-manage their pay and personal data, which reduces admin load. Deel uses major payment providers like Wise, PayPal, Payoneer, and Revolut to offer flexible withdrawal options and reduce unnecessary international transfer fees.
Deel has positive online reviews from clients and their workers. The company offers 24/7 online chat support.
Integrations are available with Ashby, BambooHR, Expensify, Greenhouse, Hibob, Netsuite, Okta, OneLogin, Quickbooks, SCIM, Xero, Workday, and Workable. They also have an Open API solution that allows developers to build their own interfaces on top of the Deel platform too.
Deel’s HR management tools are free for businesses. They offer flat rate pricing for their hiring and payroll services, so you can simply scale up or down depending on your situation. You can request a free demo through their website to discuss your hiring needs.
Rippling
Best small business HR software to centralize employee management
Rippling is an all-in-one HR software that helps small businesses manage all aspects of employee management from one centralized location. With features such as automated onboarding, digital document storage and retrieval, and complete payroll processing, the software provides an efficient way to handle the most important HR tasks.
The payroll feature automates time tracking and paychecks. This eliminates the need for manual entries and ensures that employees get paid on time and accurately every single pay period. The onboarding tool helps employers automatically set up employee accounts with all necessary information, such as tax forms, benefits packages, and company policies, which saves time and energy while ensuring accuracy. The offboarding feature allows employers to quickly terminate employee accounts and access all relevant documents in one place—making it easy to track who is currently employed by a company at any given time.
IT & security management features offer complete control over employee access points, such as email accounts and applications, without requiring manual intervention from IT staff or administrators. It provides a single-sign-on solution that allows employees to easily access multiple applications without remembering individual usernames or passwords. The platform also offers time tracking and expense management so that users can easily keep track of employee hours worked and expenses incurred while on the job. Lastly, the software integrates with popular accounting programs like QuickBooks Online to quickly sync financial information between both systems without hassle.
Greenhouse is a recruiting, hiring, and employee onboarding software that provides a basic plan that's well-suited to the needs of small businesses. You can reach a much wider candidate pool through the software, and post on over a thousand job boards. The software helps you post on the most relevant boards with smart recommendations based on industry performance and historical data. Included boards are both niche sites as well as major job marketplaces.
You can keep track of all your candidate's contact information in the platform's contact database. You can also use that data to craft personalized follow ups, interview requests, and other candidate engagement communications. The platform has automation tools to help you reduce the workload of keeping up with candidate communications, too.
You can create scorecards for screening applicants, and conduct your screenings anonymously to ensure fair and consistent evaluation. Once you've hired an employee, the software has a complete set of onboarding tools to help you get them up and running quickly.
The software integrates with other tools including Broadbean, Canditech, Cord, Docusign, Dropbox, FlexJobs, Google Meet, Indeed, Microsoft Teams, Paradox, and Seek. A free demo is available, and pricing information is available upon request.
BambooHR
Best HR software for measuring employee engagement and satisfaction
Bamboo HR is a popular HR management solution made for small businesses. The tool collects employee data from throughout the employee lifecycle and stores it in its secure databases. Having this access to records simplifies employee management.
The tool has a solution for several HR functions. The hiring feature-set improves the entire recruitment process. It deals with everything from creating job ads to applicant tracking and management. The tool also lets you create powerful onboarding sequences and manage payroll.
Some of the most interesting features are around building company culture. You can create employee satisfaction surveys with anonymous feedback to learn what people think about work. You can then track this over time to see how your employee engagement efforts are paying off.
Other features make employee performance reviews quick and easy. This allows you to switch from annual reviews to more frequent ones.
Bamboo HR has two plans: essentials and advantage. Contact the company for a quote.
Paycor
Best HR software for a wide variety of features in their lower-priced plans
Paycor's HCM platform helps small businesses manage all aspects of HR, including payroll management, benefits administration, and compliance. In addition to its core HR offerings, Paycor provides a range of services, such as employee onboarding, performance management, and time & attendance tracking.
The cloud-based platform lets you streamline HR processes and manage employee data in one central location. Paycor also provides tools to help you manage employee onboarding with time tracking, job costing, and new-hire reporting. You can confidently pay your employees on time and accurately track labor costs. The platform helps users manage expense reports and mitigate risk with compliance tools. Managers can also set up automated reminders for their employees to submit their timesheets and review their vacation requests.
Paycor helps you identify talent gaps and create succession plans. Its talent management module provides you and your managers with data-driven insights into which employees are thriving and which ones may be struggling. This information can then be used to provide targeted training and development resources.
Additionally, its tools for reviewing and providing feedback help managers ensure that their team members are on track and meeting expectations. Paycor also allows employees to view their own employee records and track their progress, empowering them to take control of their careers and ensuring that everyone is working towards the same goals.
The platform integrates with apps like Instant Pay, Goodhire, WEX, bswift, Humana, Indeed, and LinkedIn. There are dozens of other integrations available through its marketplace.
Pricing for Paycor starts at a flat fee of $99/month plus $5/employee/month.
Oyster is a comprehensive HR platform that enables companies to recruit, hire, onboard, pay, and provide employee benefits for staff or contractors across the globe. Using Oyster, you can create and manage employee profiles, track holiday and sick leaves, and monitor absences. The software can generate payslips and tax forms and keep track of employee insurance coverages.
Oyster also offers a variety of templates and tools to help businesses create custom HR forms and procedures. This can be especially helpful for small businesses that don't have the time or resources to develop their HR protocols.
Before agreeing to an international hire, you can obtain a cost estimate using Oyster's employment cost calculator, allowing you to set budgets and plan expenses accurately. Once you're ready, Oyster also helps you create, manage, and store contracts for new hires.
You can use Oyster to post jobs and oversee recruitment too. Their system allows you to track candidate responses, create interview guides, and even offer conditional job offers. It streamlines the process of onboarding new staff, from creating new accounts to uploading documents and setting up payroll. Oyster also tracks employee roles, responsibilities, and contact information too.
You can configure contracts based on the employee's location and local labor laws, and pay employees in over 120 currencies, including multiple payment methods. The software provides a central platform for users to consolidate invoices and generate detailed reports on payroll costs. Oyster's built-in expense management feature allows users to approve and reimburse expenses for remote workers.
In addition to its onboarding and payroll systems, Oyster offers an Oyster Health add-on to simplify the process of creating benefit packages for international employees. Small businesses can save time and money by outsourcing their HR needs to Oyster HR while maintaining compliance with all relevant laws and regulations.
Oyster integrates natively with other programs like ATS, HRIS, and ERP applications. Key integrations include BambooHR, Bob, Expensify, Greenhouse, Oracle Netsuite, QuickBooks, Workday, and Xero.
Pricing for Oyster starts at $499/employee/month or $29/contractor/month. They also offer a free demo.
Best HR software for integrated payroll and benefits management
Paychex Flex is a cloud-based platform that offers a wide range of HR services, including payroll, benefits administration, time and attendance, and hiring. It's comprehensive functions are perfect for supporting a small business, but it is also designed to be scalable, so you won't outgrow it as you expand. It offers a high level of customization, allowing you to tailor the system to match your specific HR processes and workflows. This flexibility ensures that the software can grow and evolve along with your business.
One of the standout features of Paychex Flex is its payroll service, which integrates smoothly with their broader HR and benefits administration solutions. This integration streamlines data management, eliminates the need for duplicate data entry, and ensures consistency across various HR functions. Paychex Flex's payroll service also generates various reports related to payroll, taxes, benefits, and labor costs, which can be customized and exported for further analysis.
Paychex Flex also features excellent benefits administration that is integrated with insurance carriers and benefit providers, simplifying the administration of employee benefits. Starting with employee onboarding, Paychex Flex handles the communication and coordination between employees, employers, and benefit providers throughout the enrollment process. It can additionally help ensure that your business is in compliance with various laws and regulations, including the Consolidated Omnibus Budget Reconciliation Act (COBRA) and the Affordable Care Act (ACA). This is perfect for small businesses that may not have someone on staff who can help ensure compliance.
Paychex Flex integrates with BambooHR, Clover, Flowtrics, GoCo, JazzHR, Oracle, QuickBooks Time, Webtimeclock, Timeero, and Xero.
Paychex Flex costs from $39/month + $5/employee/month and has a free demo available.
Best HR software for small businesses needing global payroll options
Remofirst is a cloud-based HR software solution that helps small businesses and startups comply with tax regulations and labor laws. It automates the tax and payroll process and offers a compliance guarantee, which protects businesses from potential penalties. Furthermore, it provides support and resources to help companies comply with changing regulations.
Remofirst's self-service portal allows employers to view and update their employees' information, including contact information, job titles, and salary data. You can use Remofirst to enroll employees in health insurance, dental insurance, and other benefits programs. Employees can use the tool to view their benefit options and make changes to their coverage.
Remofirst also offers a mobile app that allows users to access their accounts from anywhere. The app makes it easy to keep track of employees' hours and vacation days, as well as calculate payroll taxes. It also provides a convenient way for employees to view their pay stubs and W-2 forms.
Remofirst's payroll reporting feature makes it easy for businesses to keep track of employee payroll information. The report includes detailed information on employee salaries, deductions, and contributions. Remofirst can also generate tax reports and evaluate employee benefits and compensation packages. This information can verify that employees are being paid correctly and ensure that deductions are being withheld correctly.
All employee data is stored securely in the Remofirst cloud, making it easy for businesses to access and use when needed. Remofirst provides 24/7 customers with a live chat feature, giving access to its team of experts to help with troubleshooting problems.
Remofirst’s services cost from $199/employee/month and are available in 170+ countries. They also offer a $25/month plan if you only need to manage global contractors.
Bambee
Best for automatic compliance monitoring and guidance from certified HR professionals
Bambee is a cloud-based HR software that provides small businesses with access to HR support and guidance from certified HR professionals. It's designed to help small businesses with their HR needs, such as employee onboarding, compliance, and employee terminations.
Bambee's HR software is affordable and easy to use with an intuitive user interface. The customer support team is always available to assist with any questions or concerns, and all clients receive a dedicated HR manager as well. On top of that, you can also sign up for their guided payroll service as an add-on if you need additional help with your payroll process too.
One area where Bambee excels is its automatic compliance tracking feature, which ensures that your business is always in compliance with state and federal HR laws. Their HR auditing feature also automatically reviews your HR policies for any potential gaps that need addressing, helping you keep your policies up-to-date with any legal changes. In addition, their compliance monitoring feature also extends to mandatory training requirements covering health and safety, ethics, sexual harassment training, and other internal requirements.
Integration details are currently not available.
Pricing for Bambee starts at $99/month. You can also request a free demo through their website.
Homebase
Best all-in-one employee management software with built-in compliance
Homebase is an all-in-one employee management software with scheduling, time tracking, hiring and onboarding, team communication, employee happiness, and HR compliance features. The HR compliance functionality helps startups and small businesses automate paperwork like employee records and has e-signature capabilities for virtual documents. The system tracks employee certifications and sends users notices when labor laws change to ensure they remain compliant with federal and state-level laws.
Users can manage employee time off requests and set PTO policies directly in the software. Scheduling can be managed in the software and time clocks help track employee working time, breaks, and time off. Employee payroll is automated based on timesheets, and the system processes tax filings on the user's behalf.
The software also facilitates team collaboration with its built-in messaging platform. Direct messaging, company-wide announcements, and group and team communication can all be facilitated through the messaging portal. Administrators can track employee performance metrics and send shout-outs through the platform. Hiring and onboarding can also be managed, including posting open positions on job boards and tracking candidates through the interview and onboarding process.
A freemium plan is available for teams of up to 20 people, and paid plans start from $20/month.
Other Small Business HR Solutions
Are none of the above tools a good fit for your organization? Then here are some options that didn’t make our top list but might be a good choice for the right business. You can also check out our article on the overall best HR tools for more advice.
- Arcoro
Best HR for small construction companies
- Paylocity
Best HR software for employee self-service
- Eddy
Best all-in-one HR software for local businesses with deskless workers
- Gusto
Best small business HR software for freelance payroll accountants
- Kallidus Sapling
Best HR software for SMB's needing scalability
- BrightHR
Best HR software for small businesses needing a vacation planner & PTO tracker
- Bitrix24
Best HR software for hosting on-premise
- Beams
Best for collecting employee feedback and exchanging recognition
- CuteHR
Best HR software for managing remote teams
- Open HRMS
Best open-source human resources software
Related HR Software Reviews
If you still haven't found what you're looking for here, check out these other related tools that we've tested and evaluated:
- HR Software
- Payroll Software
- Recruiting Software
- Employer of Record Services
- Applicant Tracking Systems
- Workforce Management Software
Selection Criteria for HR Software for Small Businesses
Selecting the best HR software for small businesses requires an understanding of how software can help solve common frustrations small businesses face when trying to manage HR processes efficiently. My approach to creating this list is grounded in thorough research into how these tools can solve the needs of business owners and employees alike. I also drew on my years of experience as an HR professional to pinpoint the key features that add a lot of value and cut down on time-consuming processes.
Here's a short summary of the selection criteria I used to build this list of the best HR platforms for SMBs:
Core HR Software Functionalities (25% of final score): To be considered for inclusion in this list, each solution had to fulfill these common use cases first:
- Core HR data management capabilities that centralize all your employee data
- Integrated modules for easy digital data management
- Some form of employee self-service module to reduce administrative requests
- Tools to manage the recruiting and hiring process, payroll process, time and attendance tracking, or performance management processes
- Customizable user roles and permissions to curate who can access your employee data
In this case, since HR software is a very broad category, determining the core functions was a little trickier than usual! However, I also intentionally included a broad set of tools in this list. As a result, each software system in this list is a top choice within its area of expertise and has something unique to offer.
Additional Standout Features (25% of final score): To help differentiate one HR software from another, I also keep a keen eye out for any unique features, including:
- Advanced analytics and reporting capabilities that offer deeper insights into HR metrics
- Customizable dashboards and workflows to suit specific business needs
- Integration capabilities with other business tools and systems for seamless operations
- Built-in notifications and alerts to ensure no key details or changes slip through the cracks
- Data visualization tools that represent your workforce data visually in charts, graphs, or dynamic dashboards
- A user-friendly mobile experience or dedicated mobile apps for Android and iOS mobile devices
Usability (10% of total score): To evaluate the usability of each HR software, I considered the following:
- An intuitive design that simplifies complex processes and requires minimal training to master
- Quick access to essential features without overwhelming users
- A clean, user-friendly interface that you can customize with your company branding to enhance the user experience
- Role-based access control that's straightforward to configure
Onboarding (10% of final score): To get a sense of each software provider's customer onboarding process, I consider the following factors:
- The availability of best practice guides to streamline the setup process
- Whether comprehensive training materials are available, including videos and interactive tutorials, to speed up internal training for new users
- Customizable templates that are easy to adapt to speed up onboarding
- Evaluating the availability of dedicated customer success managers or on-call customer support teams, including 24/7 help via chatbots
- Support for migrating employee data into the new platform
Customer Support (10% of total score): To evaluate the level of customer support each vendor offered, I considered the following:
- The availability of multiple support channels, including email, phone, and chat
- Whether they offer a customer-facing knowledge base, FAQs, or other self-service tools to aid problem-solving
- Whether customer support is only available within specific time frames or zones, or 24/7 via chatbots
- The overall quality, responsiveness, and helpfulness of the support team during customer onboarding and post-purchase, as inferred from customer reviews
Value for Price (10% of final score): To gauge the value of each software, I considered the following factors:
- The availability of free trials or demos to test the software before purchasing
- Transparent pricing models that clearly explain which features are included at each level, with no additional hidden costs for training or set-up
- Tiered pricing plans with an option catered specifically to small businesses' needs with the option to scale up over time
Customer Reviews (10% of final score): Evaluating customer reviews is the final element of my selection process, which helps me understand how well a product performs in the hands of real users. Here are the factors I considered:
- Whether a product has consistently high ratings across multiple review platforms, indicating a broad level of user satisfaction
- Specific praises, criticisms, or trends in customer feedback that indicate the software's strengths or areas for improvement
- Whether customer feedback specifically mentions issues with ease of use, customer support responsiveness, or lacking features
- Any testimonials that highlight how a platform solved a particular challenge or adapted to changing business needs
By using this assessment framework, I was able to identify the HR software that goes beyond basic requirements to offer small businesses additional value through unique features, intuitive usability, smooth onboarding, effective support, and overall value for price.
Trends in HR Software for Small Businesses in 2024
Successful small businesses stay ahead of the curve—and the software that propels you needs to do the same! HR software is continuously evolving to keep pace with the changing nature of running a small business.
Here are some of the trends I'm seeing (and anticipating) in these tools:
- Integration with AI and Machine Learning: There's a clear trend towards leveraging AI and machine learning to automate and enhance decision-making processes. This includes AI-driven candidate screening in the hiring process, predictive analytics for employee performance, and automated payroll systems. These features are rapidly evolving, with software increasingly able to handle complex tasks with minimal human intervention, suggesting a shift towards more predictive and personalized HR management.
- Enhanced Data Security and Privacy: With the increasing digitization of HR processes, data security and privacy features have become paramount. The latest updates show a significant emphasis on advanced encryption methods, secure data storage solutions, and compliance with global data protection regulations. This trend is a response to the growing concern over personal data security in digital platforms.
- Mobile Accessibility: The push for mobile accessibility continues to be a critical trend. HR software is becoming more mobile-friendly, with apps or mobile-optimized web interfaces that allow managers and employees to access information and perform tasks from anywhere. This trend caters to the increase in mobile workforces and the need for flexibility in accessing HR services.
These emerging trends in HR software are not just technological advancements; they are strategic tools addressing the key pain points and needs of HR professionals in small businesses. Adopting these trends can streamline operations, improve efficiency, and foster a more engaged and compliant workforce.
These trends demonstrate a significant shift towards more intelligent, flexible, and secure HR software solutions that help small businesses stay adaptable, agile, and poised for future growth.
What is HR Software?
HR software is a digital tool for managing employee-related activities, aimed at streamlining HR processes like hiring, payroll, performance management, and benefits administration.
The primary purpose of HR software for small businesses is to ensure that all HR functions are taken care of without breaking the bank or expending more resources than needed.
Features of HR Software for Small Businesses
Choosing the right HR software for your small business is crucial to ensure your internal processes run smoothly. Here are the most important features to look for:
- User-Friendly Interface: A straightforward and intuitive user interface ensures that employees and HR personnel can navigate the software without extensive training. This ease of use is crucial for the adoption and effective utilization of the system across the organization.
- Cloud-Based Technology: Access to HR functions from anywhere at any time is essential, especially with the rise of remote work. Cloud-based HR software offers flexibility, scalability, and less investment into IT resources, allowing businesses to adjust as they grow.
- Payroll Processing or Integrations: Software with built-in payroll management functions, or integrations with other payroll systems will simplify your payroll process, reduce errors, and run payroll faster. These payroll modules can often manage tax filing at the local and federal levels too.
- Compliance Management: Monitoring changes to labor laws and regulations is a constant challenge. HR software that offers compliance management features helps ensure that businesses stay on top of these requirements, reducing the risk of penalties.
- Employee Self-Service Portal: Empowering employees to manage their personal information, request time off, and access payslips reduces the administrative burden on HR.
- Applicant Tracking System (ATS): An ATS streamlines the hiring process by organizing and simplifying candidate tracking and communication. These tools can help you manage your job postings, schedule interviews, send out offer letters, and more. They're super valuable for small businesses looking to improve their hiring efficiency and attract the best talent.
- Performance Management Tools: Effective performance management tools help teams set, track, and review employee goals and performance. This feature is key to aligning individual objectives with the company’s goals and fostering a culture of continuous improvement.
- Attendance Tracking & Time-Off Management: These combined features help small businesses manage timesheets, PTO, overtime, absences, and leave balances efficiently. Accurate time tracking is also essential for payroll accuracy and labor compliance.
- Employee Lifecycle Management: Another helpful feature for small but growing companies is setting up automated employee onboarding processes and employee offboarding workflows. Just create a list of all the things new hires need to do before starting, send them a link to your tool, and they can work through the tasks independently.
- Reporting and Analytics: Access to real-time data and analytics enables businesses to make informed decisions. This feature provides insights into HR metrics, such as turnover rates and hiring efficiency, helping businesses identify trends and areas for improvement.
- Mobile Accessibility: With the increasing reliance on smartphones for professional purposes, mobile accessibility allows employees and managers to access HR functions on the go, providing a more flexible employee experience.
Choosing HR software with these features can significantly improve the efficiency and effectiveness of your HR processes. By automating routine tasks, ensuring compliance, and providing valuable insights, the right HR software can support the growth of your small business, allowing you to focus more on your strategic goals.
Benefits of HR Software for Small Businesses
HR software is designed to make your human resource functions more efficient. By investing in modern HR software, you can reduce administrative burdens, make better data-driven decisions, and uncover actionable insights to help you strategically manage your workforce more effectively.
By selecting the best HR software for your needs, you can expect to gain the following benefits:
- Increased Efficiency: HR software automates routine tasks, freeing up time for HR staff to focus on strategic initiatives. This automation reduces the time spent on administrative tasks, allowing HR personnel to concentrate on more value-added activities.
- Streamlined Data Management: By centralizing HR data, HR software ensures that all employee information is stored in one place, making it easily accessible. This ensures that all employee records are kept up-to-date and can only be accessed or updated by authorized personnel, reducing the risk of data discrepancies and loss.
- Enhanced Decision-Making: With access to real-time data and analytics, HR software provides insights that aid in informed decision-making. This enables businesses to make strategic HR decisions based on accurate and up-to-date information.
- Improved Compliance: By keeping track of changing labor laws and regulations, HR software helps ensure that businesses remain compliant. This reduces the risk of legal issues and penalties associated with non-compliance.
- Enhanced Employee Experience: Most HR software offers employee self-service portals that empower employees to manage their personal information, submit time-off requests, and access their payroll and benefits information online. This level of autonomy improves the overall employee experience, leading to higher engagement and satisfaction levels.
HR software for small businesses can help you manage your HR functions more efficiently and effectively. From improving compliance and decision-making to enhancing your employee experience, the benefits are clear. For small businesses looking to streamline their HR processes and focus on growth, investing in HR software is a step in the right direction.
Costs & Pricing for HR Software for Small Businesses
HR software solutions offer different pricing options to meet the diverse needs of small businesses. These plans typically range from basic free versions to more advanced packages with additional features. Understanding the specifics of each plan will help you choose the most suitable option for your business needs and budget.
Plan Comparison Table for HR Software
| Plan Type | Average Price | Common Features |
|---|---|---|
| Free | $0 | Employee self-service, basic reporting, and access for a limited number of users |
| Basic | $4-7 per user/month | Employee self-service, payroll processing, basic reporting, and email support |
| Standard | $8-12 per user/month | Basic features plus time and attendance tracking, performance management, and chat support |
| Premium | $15-30 per user/month | Standard features plus advanced reporting, HR analytics, priority support, and custom integrations |
When selecting the best plan for you, consider your current and future needs. A free or basic plan might suffice for now, but if your business is poised to grow, a standard or premium plan may be a better fit for the HR features you need.
If cost is your biggest factor, this article digs into the costs of HR software and how you can decide what's best for your company.
Frequently Asked Questions
Here are some answers to popular questions we hear often about HR software for small businesses:
Are there different types of HR software that are suitable for small businesses?
There are absolutely different types of HR software that help small businesses organize all their employee information. The most common types include:
- HRIS = human resources information system
- HCM = human capital management [system]
- HRMS = human resource management system
However, others go by more general terms such as HR management systems or HR databases. Within these systems, you’ll be able to access a range of features, including payroll solutions, document management systems, performance management tools, and self-service benefits administration portals. Many also include mobile apps for both your internal HR team as well as your employees.
As a small business owner, what else should I know to help me select the best HR software?
Small businesses don’t need a complete set of advanced human resources features. When choosing the right HR software for your business, think about your current business challenges and HR needs and choose a tool that excels in these areas. This will help you get the workforce management features you need without overpaying.
To help you make an informed decision, I recommend reading our article covering different HR software requirements.
How scalable are these HR software solutions for growing businesses?
Many HR software solutions are designed with scalability in mind, making them a great fit for growing businesses. They often allow you to easily add new users, functionalities, or modules as your company expands. This flexibility ensures that as your business evolves, your HR software can grow with you, adapting to new challenges without requiring a complete system overhaul.
Generally, HR software will also have multiple plan tiers to cater to the needs of different business sizes. Many offer freemium plans that are well-suited to small businesses, and you can upgrade as needed to meet the increasing needs of your company.
What kind of customer support and training do HR software providers offer?
HR software providers usually offer customer support and training through a mix of:
- Online resources and self-serve content (videos, knowledge base, tutorials, etc.)
- Live support (chat, phone, video, etc.) and email support
- Training and onboarding programs
- User-generated support content (forums or communities)
The depth and availability of these resources can vary from one provider to another, and from one plan tier to another. Finding an HR software provider with sufficient support offerings is particularly important for small businesses that may be operating without internal HR expertise. Be sure to consider what support is available when selecting an HR software for your company.
Do small businesses require HR?
Small businesses need some form of HR. Even if you don’t have a dedicated team, someone at your company needs to process payroll, find and onboard new employees, and manage your staff. The standard ratio of HR staff to employees is 1.4 HR professionals for every 100 employees you have.
HR software can simplify all your core HR processes to help your small team work more efficiently. Also, many HR software solutions include guidance around compliance and employment law, which is challenging if you aren’t an expert. The key for small businesses is finding a solution with the HR features you need, without having to pay for unnecessary extras.
What can you do if your company doesn't have an HR department?
Don’t sweat it. Many small businesses won’t have a dedicated HR department. This isn’t a problem as there’s no legal requirement to have one. But, you will need to educate yourself about HR functions or have someone else in your team be in charge.
If you find that managing HR is taking up too much of your time, use software to automate mundane but time-consuming tasks. Or, consider hiring extra help or investing in HR outsourcing. If that sounds like a good fit, read our article on the benefits of outsourcing HR, including key strategies and other considerations, for more details.
How do HR software systems manage data security and compliance?
Protecting employee data and keeping employee records confidential is very important. Many human resources software have security features in place to safeguard sensitive information, such as salaries, personal information, contracts, and performance evaluations. They achieve this through robust cybersecurity measures, including encryption, firewalls, and multi-factor authentication to prevent unauthorized access and data breaches. Regular risk assessments are also conducted to identify and mitigate potential vulnerabilities, and an incident response plan is in place to address any breaches swiftly.
Additionally, these systems strive to comply with global data protection regulations — such as GDPR, HIPAA, and SOC 2 — to ensure they meet legal standards for data privacy and security. It’s also important for businesses to assess the data security practices of any third-party HR software or services they use, ensuring these external entities adhere to the same high standards of data protection
This article offers more details into data management best practices if you’re interested in learning more.
How can HR software facilitate change management?
Managing change is integral to the smooth running of any business, but especially for small businesses and startups that are scaling quickly. Keeping everyone aligned and motivated towards collective goals can be tricky, especially when things are shifting or priorities change. HR systems offer tools and functionalities that can support your change management, such as:
- Communication tools: The ability to send out strategic communications at an individual, team, and company level to explain changes and provide additional information.
- Business process management: Mapping out your processes and keeping them up-to-date so everyone knows how to manage their workflows and keep operations smooth.
- Employee feedback surveys: Tools to collect feedback and measure employee engagement levels through change. These insights can contribute to planning new initiatives or important communications.
Employee management is an art form, and requires ongoing adjustments to get it right. Having a software to support your processes, goal planning, and more can make a big difference.
How long is the average implementation process for HR software?
The implementation process for HR software can vary widely depending on the complexity of the system and the specific needs of your business. Naturally, simpler systems can be set up in a matter of weeks, while more comprehensive solutions could take several months to fully implement.
Key factors affecting this timeline include the scale of the organization, the extent of data migration required, customization needs, and the readiness of the business to adapt to new processes. During this period, businesses often work closely with the software provider to configure the system, transfer data, and train staff on how to use the new tools effectively.
How can you measure the ROI of implementing new HR software?
Measuring the ROI of implementing new HR software involves assessing improvements in efficiency, productivity, and cost reductions against the investment made in the software. A simple formula to start with is:
ROI = (Gain from Investment – Cost of Investment) / Cost of Investment
Key metrics to consider include the time saved on administrative tasks, improvements in employee engagement and retention rates, and the reduction of errors in payroll and benefits management. Additionally, the software’s impact on strategic HR activities, such as talent acquisition and development, should be evaluated to understand its contribution to the organization’s overall performance.
For more details on estimating ROI, this article offers more insights into HR software purchase factors to consider, including costs.
Why HR Software is Crucial for Small Business
HR software is a relatively broad product category, and includes tools that simplify or automate common HR tasks and processes, help you manage the employee lifecycle, process your payroll, and more. So depending on the specific software—and your specific business—it might serve a number of use cases. For small businesses with limited resources, implementing HR software can be a huge help. Here’s how:
- Provides a cost-effective solution to ensure a well-established foundation for your HR operations, ensuring compliance as you scale.
- Streamlines and automates key HR functions and business processes, reducing manual workloads and margin for human error.
- Lets you measure and enhance employee satisfaction and engagement levels as your teams grow.
- Gives self-service options to employees so they can manage their contact information, benefits, pay and tax documents, etc.
- Creates strategic alignment between your HR functions and your broader organizational goals.
Other HR Resources for Small Businesses
Working within a tight budget can sometimes be stressful. However, we have a lot of other software lists that were specifically prepared with that in mind.
Here's a list of our top resources for small businesses you should definitely check out:
- Applicant Tracking Systems for Small Businesses to Recruit Better
- Employee Scheduling Software for Small Business
- ERP Systems for Small Businesses on a Budget
- Free Payroll Software for Tight Budgets
- HRIS for Small Businesses to Manage HR Data
- HRMS for Small Business
- Learning Management Systems (LMS) for Small Businesses
- Payroll Services for Small Businesses
- Payroll Software for Small Businesses
- Recruitment Software for Small Businesses
Small Businesses Need Tools to Support Their HR Operations
Many small business owners become Jacks of all trades. They end up taking on not just the strategic and operational side of running a business but also people management, HR, accounting, compliance, and more. Investing in the right software solutions and tools to help support you will make a world of difference. And finding the best HR software for your small business is one step in the right direction.
To discover more of the best tools for your various small business needs, and get expert insights from industry leaders, be sure to sign up for the People Managing People newsletter.