Human Resource (HR) Software

What is Human Resource (HR) Software?

Human resource software (also known as HR software) manages employee information while automating tasks involving the people in your organization, such as employee scheduling, recruitment, and boosting employee productivity. HR software helps your organization achieve its goals by allowing managers to better allocate employee time and resources to become a more productive and profitable business through better employee record keeping and increasing employee performance.

HR systems can also be referred to as a human resource management system (HRMS) or a human resource information system (HRIS). Each term refers to all-in-one software providing you the ability to manage your organization’s human capital.

Features of Human Resource (HR) Software

• Employee Information Database: A complete directory of employee profiles including personal information, job description, salary history, banking and tax info, benefits information such as enrolled insurance, time off requests, and job performance feedback.
• Recruiting and Onboarding: Post current openings on various job board websites. Integrate new employees into the organization by familiarizing them with the client base and products/services offered. Implement an applicant tracking system to find the best employees.
• Talent Management: Helps your business retain, promote, and train workers. Functionalities include leadership development, succession planning, compensation management, and performance management.
• Benefits Administration: Streamlines the enrollment process for employee benefits. Helps reconcile benefit standard costs and determines eligibility based on selected criteria. Includes reporting on employee elections and how they relate to your company budget.
• Performance Reviews: Discover data-driven employee analytics and facilitate management/employee communication, identify employee strengths and weaknesses, set individual goals, make informed compensation decisions.
• Payroll: Use HR management to control all elements of executing employee compensation, including wage calculation, check printing or direct deposit, and payroll tax management.
• Time Tracking: Allow employees to report time (either in real-time or after-the-fact) for wage calculation purposes. Manage time off requests.

Best Human Resource Software Benefits

Human resource information systems are designed to streamline your HR processes, consolidate files, and help your company become more efficient. This lets your staff focus on developing employee talent, rather than focusing on shuffling paperwork.

Having a user-friendly solution that helps you manage your HR functions can not only help you save money, but help you retain and get the most out of your human resources department.

Improve the Productivity and Efficiency of Your Team

An HR system can measure employee satisfaction, streamline their workflow and tasks, let employees self-manage a variety of tasks, and improve their skills and training. This can and will improve employee engagement and help monitor employees that can potentially drag your company down. Whether a disinterest in their work, poor management, or more, HR software can help determine the underlying cause for poor performance.

For example, surveys can gather feedback anonymously about how employees feel about their jobs, management, their level of pay, and more. Employees may feel more in power of their responsibilities through a self-service portal, such as clocking in for the day from their own computer, while being able to view pay stubs, adjust their benefits, or request time off.

For your human resources staff, automating repetitive and intensive tasks and processes such as payroll and benefits administration can free up their time to handle other areas of focus, such as attracting new talent, onboarding new hires, or retraining struggling employees.

Improve Regulatory Compliance

A human resources department is required to follow the federal, state, and local regulations that cover areas such as recruitment, labor relations, benefits, and employee termination. The most common areas of requirements and provisions HR professionals will deal with are wages, hours worked, employee health and safety, benefits, and workers compensation.

Human resource modules store data on all the people in your company in one convenient place. Automated reminders can be created when action is required on an employee file, such as maintaining regulatory requirements for GDPR compliance, right-to-work checks, health and safety certifications, and moreHR initiatives.

Integrate with Payroll Processes

There are frequently a few key integration points between payroll and HR software. Deductions need to be calculated, funds withheld for retirement contributions, and pay stubs created and shared with employees. Payroll software packages not only allow you to process payroll–they also manage the information necessary to report back to the IRS and state taxing authorities.

Rather than using an outside payroll system, a fully-integrated human resource software with payroll functionality will eliminate any double data entry. Your HR software will automatically update all impacted information when any adjustments are made to your payroll figures. This can save time in creating payroll reports, allowing you to quickly gather analytics that can be used by management.

Human Resource Software by Company Size

There are a variety of human resource software options depending on company size and the scope of your organization:

Small Business HR Software

Small businesses may feel their small number of employees means they can get by without human resource software. However, small businesses still need assistance in automating various HR workflows, as these companies likely have no dedicated HR staff–a single employee probably handles HR tasks in-house among other responsibilities. That means they have to handle record-keeping, regulatory compliance, time and attendance, payroll, and more–all on top of their regular day to day work.

Due to smaller budgets and limited resources, small businesses should look for a software that will make them as efficient as possible for the most affordable price without sacrificing ease of use. Small businesses should focus on core HR software, the base functionality needed to run your business, such as payroll, time tracking, and benefits administration.

Mid-Sized HR Management Software

Businesses that have outgrown small business HR software will want to find a solution that offers core HR on top of additional functionalities–known as strategic HR. This added layer has a bigger focus on talent management capabilities, such as recruitment, hiring, onboarding, and ongoing training.

There are many stand-alone HR products that offer strategic HR functions as an add-on to your base software package. This makes it possible to start small with a core HR, and find a dedicated applicant tracking software, payroll solution, or performance management templates. However, mid-sized companies are better served finding a solution that offers these functions as a complete scalable option.

Enterprise HR Software

An enterprise or larger business will want a fully integrated HR suite to meet their needs. This option will handle all areas of managing your HR department from end-to-end. This option likely runs independent of any ERP software the business uses, rather than being considered part of an ERP software.

Additional capabilities found in an enterprise HR software include learning management functions such as e-learning, as well as optimized content management–meant for creating content for digital learning.

Pricing of Human Resource (HR) Software

The cost of human resource management solutions will vary depending on:

• The size of your business
• The number of employees you have
• The number of users requiring concurrent access
• The level of included services such as support and hosting

It is also dependent on the functionality included. For example, a small business that only needs software for basic payroll and time tracking will be far less expensive than a complete HRIS system with learning management features and ERP integrations.

HR software starts as low as $5 per user per month, and can get into the hundreds of dollars per month. Subscription-based (SaaS) pricing models are common in cloud-based HR software. Cloud HR software usually includes support and annual updates within the quoted price.

Some HR software pricing models will bill based on employee count rather than per active user. This means a solution may advertise as low as $1 per employee per month–but look out for a minimum required number of employees. Others may charge a base fee per month before they calculate the per employee cost. For example, a software provider may charge a 20 person company $1 per employee per month (or $20/month) in addition to a $75 per month base charge–bringing the total to $95 each month.

HR vs HCM

There are a lot of separate types of software to optimize various HR processes. Primarily, human resource software is commonly compared with human capital management (HCM)software – a collection of human resource applications which manage workforces through recruitment, onboarding, training, and performance management. Both options provide core HR functionalities, such as payroll, attendance, employee benefits, and in-depth reporting.

While HCM systems may initially seem more advanced by including onboarding and succession planning, however, many human resource systems will also provide these same capabilities. One can rest easy knowing that whether you’re in the market for an HR software or HCM software, they offer many of the same benefits.

Other dedicated HR software options include:

• Compensation management
• Time and attendance
• Payroll
• Onboarding
• Performance management
• Talent management