Best HR software for a small nusiness

Human resources (HR) software is designed to streamline and manage core HR functions. By automating processes such as payroll, PTO requests, and benefits administration, HR software helps small businesses save valuable time and reduce administrative burdens. 

With a range of HR software options available, each offering unique features and capabilities, it's crucial for businesses to choose the solution that aligns with their specific needs. This article will help you identify the best HR software to fit small business requirements and optimize your HR operations.

Types of HR software for small business

HR software for small businesses isn't one-size-fits-all. Different tools solve different problems, and understanding the categories helps you avoid buying more (or less) than you actually need.

All-in-one HR platforms 

Comprehensive platforms combine multiple HR functions like payroll, benefits, time tracking, and employee records in a single system. These platforms eliminate data silos and reduce the vendor juggling that kills productivity. Rippling is a great example of an all-in-one solution that centralizes your employee data. 

Payroll-focused solutions 

These tools handle wage calculations, tax filing, and compliance but offer limited HR functionality beyond payments. Gusto is a good example, and while ADP and Paycom started here, they've expanded their offerings over time.

Applicant Tracking Systems (ATS) 

ATS solutions streamline recruiting and hiring but don't handle post-hire HR functions. Workable and Greenhouse excel here, but you'll need separate systems for payroll and benefits.

HR Information Systems (HRIS) 

HRIS platforms focus on employee data management, organizational charts, and reporting without necessarily including payroll. BambooHR is the classic example, as they’re strong on HR records but a touch light on financial processing.

Specialized point solutions 

These niche tools target specific HR needs like performance management, learning management, or employee engagement. These work well as add-ons but create integration headaches as your primary solution.

Quick comparison: Best HR software for small business at a glance

We’re going to review each of our top choices for best HR software for small business owners in-depth, but if you want a preview or to see the tools at a glance, here’s a quick breakdown: 

Methodology: How we chose the best HR software for small business

We evaluated dozens of HR platforms through hands-on testing, customer reviews on G2 and Capterra, and analysis of each vendor's actual capabilities versus their marketing claims. And, as a small business owner myself, I’ve actually used multiple tools on this list as a customer. 

We analyzed hundreds of verified user reviews, focusing on:

• Actual implementation timelines versus vendor promises

• Hidden costs and surprise fees

• Quality of customer support for non-enterprise accounts

• Feature limitations in base tiers

• Integration reliability with common small business tools

Our criteria

During the evaluation process, this is what we looked for: 

• Ease of use: Small businesses don't have dedicated HR teams. We prioritized platforms that employees can actually use without training manuals or IT support.

• Implementation speed: We looked for platforms you can set up in days, not months. Every vendor claims "quick setup" — we verified which ones actually deliver.

• Pricing transparency: Hidden fees kill small business budgets. We favored vendors with clear, published pricing over those requiring sales calls for basic cost information.

• Scalability: Your HR software should grow with you. We assessed whether platforms handle 10 employees as well as they handle 100, without forcing expensive upgrades.

• Rippling editorial policy: Rippling puts our customers (and prospective customers!) first. The Rippling team is committed to providing information supported by product data, insights, and customer feedback to inform our content.

The best 8 HR software systems for small businesses: deep dive and full review

Here's what eight leading HR platforms really deliver (and where they fall short) based on our careful evaluation and according to customer feedback.

1. Rippling

Rippling has the most complete small business HR software on the market, combining HR, payroll, benefits, and IT management in one unified system.

Pricing: $8 PEPM 

Why it stands out: Unlike competitors that require multiple integrations, Rippling runs everything on a single data model. 

Complete employee lifecycle management, automated multi-state payroll, and IT management including device provisioning all work together seamlessly. The platform offers enterprise-level features like proactive compliance tracking without enterprise complexity.

HCM software that makes HR more strategic

See Rippling

Where it can fall short: The extensive functionality might overwhelm very small businesses that only need basic features like payroll. 

It's right for you if: You want to eliminate data silos between HR and IT systems, plan to scale significantly, or need advanced automation capabilities that typically require enterprise software.

2. BambooHR

BambooHR focuses on core HR functions with an exceptionally user-friendly interface that prioritizes employee data management and basic workflows.

Pricing: Starts at $10 PEPM

Why it stands out: The intuitive interface makes it genuinely easy for non-HR professionals to use. Mobile apps for both employees and administrators are well-rated. Time-off tracking and approval workflows are particularly well-designed, and the recruitment and ATS features are included (though you’ll need the Pro plan to scale up to 25 postings)..

Where it can fall short: BambooHR does have a lack of some features that you may need if your business plans to grow, like advanced learning management systems. It also doesn’t integrate with as many tools as larger platforms like Rippling. 

It's right for you if: You're new to HR software or prioritize ease of use over advanced features. 

Feature snapshot:

3. Paycor

Paycor offers a full suite of HR services through their HCM platform, with strong support for businesses that prefer guided implementation. 

Pricing: Custom pricing through sales

Why it stands out: Paycor has multiple distinct software solutions, and their HR and payroll software is rolled into one. They offer HR, talent acquisition, workforce management, and benefits administration software that can help address your needs as your business grows. 

Where it can fall short: The interface feels dated compared to modern alternatives, and some users reported they’d like more advanced reporting features or comprehensive access to benefits information. 

It's right for you if: You want comprehensive HR support with human guidance, need industry-specific features, or prefer a more traditional service-oriented approach.

Feature snapshot:

4. Gusto

Gusto offers strong payroll features with basic HR functionality in a modern, easy-to-use package designed for small businesses.

Pricing: Plus plan (which includes HR features) starts at $80 per month + $12 per person 

Why it stands out: Gusto excels in automated payroll processing that works well without constant oversight, and is incredibly straightforward even for small businesses without HR teams. Their benefits administration is also small-business friendly, but they have solid compliance features for state-level requirements, tax payments, and BOI reporting.

Where it can fall short: Gusto’s HR features are basic compared to more comprehensive platforms, with somewhat limited customization options. Larger and enterprise businesses will benefit more from other tools. 

It's right for you if: You need reliable payroll with basic HR features, value transparent pricing, and don't require extensive customization.

Feature snapshot:

5. Paycom

Paycom provides a comprehensive suite of HR tools with strong self-service options and learning management capabilities.

Pricing: Custom pricing based on company size

Why it stands out: Paycom offers true self-service payroll that lets employees manage their own data, and their payroll preview feature prevents errors before they happen. The platform also includes learning management, which is rare at this price point. Overall, it scales without requiring platform changes. 

Where it can fall short: Some users have reported feature limitations or clunky reporting. Multiple users, for example, shared that they’d get continued notifications about missing access for terminated employees. Others reported that the ability to integrate with other systems frustrating, and since Paycom has taken an intentional approach not to integrate with third-party tools, this will remain a sticking point for many customers

It's right for you if: You plan significant growth, want employees to self-manage HR tasks, or need built-in learning management but don’t need to connect with multiple third-party tools. 

Feature snapshot:

6. Deel

Deel specializes in global payroll and contractor management for companies hiring internationally, handling both contractors and full-time employees.

Pricing: $20 per worker per month for HR features, $599 per employee per month for Deel EOR, $29 per employee per month for Deel Global Payroll 

Why it stands out: Makes international hiring manageable for small businesses with payments in 150+ countries. Offers a variety of contractor payment methods, including cryptocurrency.

Where it can fall short: Deel has been known to charge additional fees outside of its standard PEPM costs. Some users also report occasional payment delays. Deel also integrates with fewer tools compared to alternatives.

It's right for you if: You hire contractors or employees internationally, need multiple payment options for contractors, or plan to expand globally.

Feature snapshot:

7. Factorial

Factorial is a modern HR platform built specifically for small and medium businesses, offering comprehensive features at competitive prices.

Pricing: Starts at $8 PEPM

Why it stands out: This platform includes time tracking, document management, and performance reviews at an affordable price. There’s also built-in expense management, shift scheduling, procurement, and project management tools. 

Where it can fall short: Some users noted that certain modules weren’t developed enough to be helpful. Multiple users also reported slow customer support responses, and some advanced features require higher-tier plans.

It's right for you if: You want comprehensive HR features at an aggressive price point, have international employees, or need strong document management capabilities.

Feature snapshot:

8. Namely

Namely is a mid-market HR platform that helps growing small businesses transition to more sophisticated HR management with modern tools and social features.

Pricing: Starts at $12 PEPM

Why it stands out: The platform balances powerful functionality with genuine ease of use — a rare combination in mid-market HR software. Social HR features like peer recognition, company newsfeeds, and team directories create the engagement typically reserved for enterprise platforms. Custom reporting capabilities let you track metrics that actually matter to your business, not just pre-built templates.

Where it can fall short: At $12 per employee per month, it's pricier than true small business solutions. The social features might feel unnecessary for very small teams. Some advanced modules cost extra, which can add up quickly.

It's right for you if: You're focused on building a strong company culture as you grow, want modern tools that employees will actually enjoy using, and need more sophistication than basic HR software provides.

Feature snapshot:

How to choose HR software: Key features to look for

When selecting HR software, it's essential to evaluate key features that align with your small business needs to ensure you choose the right solution. Identifying software with the appropriate functionalities ensures that your HR operations run smoothly and that you can effectively manage and support your workforce.

We’ve identified five key features that the best HR software for small businesses have:

Employee onboarding

Effective onboarding helps integrate new hires into your organization. Onboarding enables a smooth transition by automating paperwork, training, and introductions, which can improve employee satisfaction and reduce turnover.

Time and attendance tracking 

Accurate time and attendance tracking is essential for managing employee hours, preventing errors in payroll, and ensuring compliance with labor laws. Time tracking and scheduling also enables small businesses to monitor attendance patterns, manage leave requests, and control labor costs.

App integrations

Integrations with other software tools, such as accounting or project management systems, enhance efficiency by allowing seamless data flow between platforms. Integrating necessary apps reduces cumbersome manual data entry and helps teams manage all their systems. 

Payroll management

HR software can automatically calculate wages, deductions, and taxes — ensuring both timely and accurate payments to employees. With payroll software, you can minimize errors, reduce administrative workloads, and ensure compliance with tax regulations.

Compliance management

Tracking compliance with labor laws and regulations like minimum wage and overtime requirements is critical to avoiding reputational issues and fines. And a compliance tool that empowers small businesses to train employees about workplace policies, manage regulations, and save documentation can help protect the business.

Which HR software for small business is best for you? 

Each small business is unique. My small business with a grand total of one employee, for example, has different needs from a small company with 20 employees that has remote workers in different states and plans to scale in the coming years. 

It’s essential to choose a platform that meets your current and future projected needs, so here are our recommendations: 

• For startups (1-20 employees): Gusto offers straightforward payroll, tax guidance, and basic HR features for affordable pricing and minimal complexity. But if you're planning on long-term growth, starting with Rippling prevents painful migrations later.

• For growing businesses (20-100 employees): Rippling delivers the comprehensive functionality you'll need without enterprise complexity. The automation capabilities become invaluable as administrative burden scales with headcount.

• For global teams: Deel simplifies international hiring, while Rippling handles both domestic and international operations in one platform.

• For compliance-heavy industries: Paycom's single-database architecture and compliance tools justify the higher cost for businesses where compliance failures mean closure.

• For budget-conscious teams: Gusto provides the best value for basic HR needs with clear, affordable pricing and no hidden fees.

The complete HR solution for growing businesses

See Rippling

Transform your HR management with Rippling

Here's what sets Rippling apart from traditional HR software and cobbled-together point solutions:

• Built for growth without growing pains: Start with five employees and scale to 500 without switching systems. Rippling handles multi-state payroll, international contractors, and complex compliance requirements that typically force small businesses to change platforms at 25, 50, and 100 employees.

• Unified data eliminates double entry: One employee record drives everything, including payroll, benefits, time tracking, and even IT access. No more copying data between systems or explaining why information doesn't match.

• Automation designed for small teams: Build workflows that actually eliminate work, not just move it around. Automatically onboard new hires with the right access to dozens of apps. Route time-off requests based on department and coverage needs. Trigger compliance training based on role and location — all without writing code or hiring consultants.

• Self-service that employees actually use: Your team can update their information, request time off, and enroll in benefits without training or IT tickets. The interface makes sense to humans, not just HR professionals. That means fewer interruptions and more time for strategic work.

• Implementation in days, not months: While competitors require lengthy setups and data migrations, Rippling gets you operational fast.

• Transparent pricing that scales: No hidden modules. No surprise fees when you hit arbitrary employee thresholds. Rippling's pricing grows predictably with your business, so you can actually budget for growth.

It’s essential to remember that small businesses are tight on time and resources. Choosing the right platform is a net positive, because it can give your team valuable time back in their day and avoid costly mistakes.

The reality is this: small businesses don't need another HR tool to manage. They need a platform that eliminates the boundaries between HR, payroll, benefits, and IT — letting them focus on growing their business instead of managing their tech stack.

Ready to automate your HR operations and get back to building your business? See how Rippling transforms small business HR. 

Frequently asked questions