Finding the best HR software for small business shouldn’t feel like searching for a needle in a haystack, yet for many owners, it does. Today, an estimated 3.2 million small-to-medium businesses rely on cloud-based HR software to manage complex HR functions.

Despite this impressive adoption rate, nearly 60% of HR professionals still use old-fashioned paper, spreadsheets, and other manual tools for recruiting, onboarding, and talent management. If you’re among them, you’re likely missing out on significant efficiency gains – after all, 69% of users report their HR management tools cut down on payroll processing time.

When evaluating human resources software for small business needs, cost is undoubtedly a major factor. The average HR software solution costs $5 to $20 per employee per month, plus a monthly base fee between $40 and $100. Furthermore, if your business hires workers internationally, the HR complexities multiply dramatically, and most small business HR systems don’t adequately address these challenges.

That’s why we’ve thoroughly evaluated the market to bring you truly affordable options. In fact, from an initial evaluation of 33 HR software products, we’ve narrowed down our recommendations to the 7 best HR systems for small businesses that won’t break the bank in 2025.

BambooHR

_{Image Source: People Managing People}

BambooHR has been making small HR teams mighty since 2008, establishing itself as a comprehensive solution designed specifically for growing businesses. This cloud-based HR platform centralizes employee data management while automating key workflows that often bog down small business HR departments.

BambooHR key features

BambooHR offers a robust set of features that create a complete HR ecosystem:

• Centralized employee database: Stores all employee information securely in one place, eliminating the need for multiple spreadsheets and paper files. The system enables employee self-service, reducing administrative burdens.
• Automated workflows: Streamlines approval processes for employee information changes, time-off requests, compensation adjustments, and more.
• Time-off management: Employees can request PTO from desktop or mobile, with automatic calculation of available hours based on company policies.
• Applicant tracking system: Available in the Advantage/Pro plan, this feature allows posting to job boards, tracking candidates, and managing the hiring process through an intuitive three-step process.
• Customizable onboarding: Creates tailored new hire packets based on job type, department, and location, with e-signature capabilities for required documents.
• Performance management: Available as an add-on, this feature includes self and manager assessments, 360° feedback, goal setting, and performance reports.
• Reporting tools: Offers built-in report templates and custom report building capabilities to track key HR metrics.

BambooHR pros and cons

Pros:

• User-friendly interface with intuitive navigation for both employees and administrators
• Award-winning customer support available through email, phone, and chat
• Over 150 pre-built integrations with third-party applications
• Mobile app for employee self-service and HR management on the go
• E-signature capabilities that streamline document workflows
• Employee satisfaction measurement with eNPS surveys and AI-powered response categorization

Cons:

• Limited customization options for companies with specific workflow requirements
• Benefits administration and time tracking require additional add-ons
• Payroll functionality is an add-on rather than included in the base package
• May become less efficient for companies with more than 350-500 employees
• Some users report the performance review module has room for improvement in customizability
• Not ideal for companies with high hiring volumes needing automated candidate sourcing

BambooHR pricing

BambooHR offers a tiered pricing structure with two main plans:

Popular Add-ons:

• US Payroll: $150.00/month for 20 employees + $7.25/month per additional employee
• Benefits Administration: $5.00 per employee per month
• Time Tracking: $3.00 per employee per month
• Performance Management: $5.25 per employee per month

Companies with 20 employees or fewer pay a flat monthly rate, while those with more than 20 employees pay on a per-employee-per-month basis. Notably, BambooHR automatically applies volume discounts as employee count increases, making it more cost-effective as your business grows.

BambooHR best for

BambooHR is primarily designed for small to medium-sized businesses with fewer than 350 employees. It’s especially valuable for:

• Companies transitioning from spreadsheets and paper files to their first HR system
• Organizations prioritizing employee onboarding and experience
• Businesses seeking to automate core HR tasks and workflows
• Companies that need centralized data management with powerful reporting capabilities
• Teams looking for collaborative hiring tools with intuitive applicant tracking
• Businesses with multiple locations or remote workers needing unified HR management

Additionally, BambooHR works well for companies seeking an integrated solution that can grow with them. According to one customer testimonial, “Simply by automating time-off management, BambooHR freed $40,000 in increased capacity to support additional employees”.

Gusto

_{Image Source: Gusto}

Originally founded as a payroll solution, Gusto has evolved into an all-in-one HR platform that small businesses rely on for simplified people management. This cloud-based system combines payroll, benefits, and HR functions into a single, user-friendly interface.

Gusto key features

Gusto combines powerful HR capabilities with exceptional usability:

• Automated payroll processing: Calculates and files payroll taxes automatically in all 50 states, with unlimited payroll runs at no extra cost.
• Benefits administration: Offers over 9,000 health insurance plan options through 30+ carriers, plus retirement, HSA, FSA, commuter benefits, and workers’ compensation.
• Employee self-service: Provides employees with direct access to pay stubs, tax documents, and personal information updates through both web and mobile interfaces.
• Hiring and onboarding: Features customizable onboarding checklists, document storage, e-signatures, and software provisioning for new hires.
• Time tracking and PTO management: Includes time tracking, scheduling, and automated PTO approval workflows that integrate directly with payroll.
• Bill pay functionality: Allows businesses to manage, pay, and track bills and vendors—a unique feature not typically available in HR software.
• Performance management: Offers tools for performance reviews, goal tracking, and anonymous feedback surveys (in Plus plan and above).

Moreover, Gusto provides compliance tools and access to certified HR professionals to help navigate complex employment regulations.

Gusto pros and cons

Pros:

• Intuitive, user-friendly interface that’s almost “fun to use” according to reviewers
• Flexible payroll run views with customizable columns
• Automated tax filings and payments across all 50 states
• Strong mobile app experience for both employers and employees
• Highly customizable payroll run types (bonus, off-cycle, benefits correction)
• Bill pay integration through Melio at no additional cost

Cons:

• Higher cost structure compared to competitors, particularly with per-worker fees
• Limited international capabilities (only supports full-time employees in 10 countries)
• Customer support has faced challenges maintaining service levels since the pandemic
• Basic time tracking in lower tiers requires upgrade for advanced features
• Limited reporting options compared to more advanced HR systems
• Not ideally suited for companies with more than 150 employees

Gusto pricing

Gusto offers four primary pricing tiers:

Additional add-ons include global contractor payments, state tax registration, health insurance broker integration, and specialized benefits like HSAs, FSAs, and 401(k) plans.

Gusto best for

Gusto excels as an HR solution for:

• Small businesses with fewer than 150 employees seeking an intuitive, all-in-one HR platform
• Startups and tech-savvy companies that value modern user interfaces and smooth onboarding experiences
• Multi-state employers needing automated tax filing across different jurisdictions
• Businesses with primarily domestic operations as international capabilities are still developing
• Companies prioritizing employee experience through self-service tools and financial wellness features
• Organizations with mixed W-2 and contractor workforces that need unified payment systems

Unlike legacy platforms that cater primarily to larger enterprises, Gusto was built specifically with small businesses in mind. As one customer noted, “With Gusto, Rise Marketing has quickly and compliantly hired employees in other states, while also paying international contractors on time, in the right currency”.

Zoho People

_{Image Source: Zoho}

Zoho People stands out as a versatile HR management system designed to centralize employee data and streamline human resource operations for businesses of various sizes. As part of the broader Zoho ecosystem with its 45+ business applications, this cloud-based platform offers extensive customization options while maintaining an affordable price point.

Zoho People key features

Zoho People delivers a comprehensive set of HR capabilities through its modular structure:

• Centralized employee database: Creates a single repository for all employee information, enabling self-service access to profiles and HR services through both web and mobile interfaces.
• Attendance management: Supports diverse tracking methods including biometric systems, facial recognition, and GPS location tracking for on-site and remote workers.
• Leave management: Automates request submissions and approvals through a self-service portal, reducing paperwork while providing transparency on leave balances and statuses.
• Time tracking and shifts: Facilitates recording time spent on activities, managing different shift patterns, and generating custom reports for payroll processing.
• Performance management: Enables setting objectives, conducting appraisals, and tracking employee progress through KRAs, goals, skill sets, and 360-degree feedback.
• Learning management system: Offers course creation, batch management, blended learning approaches, and assessment tools to support employee development.
• HR process automation: Configures multi-level approvals, automatic email alerts, webhooks, and custom workflows to streamline repetitive tasks.
• Customizable forms and services: Provides drag-and-drop tools to create custom forms and applications tailored to specific business needs.

Furthermore, Zoho People integrates seamlessly with other Zoho applications and supports limited third-party integrations, enhancing cross-departmental workflows.

Zoho People pros and cons

Pros:

• Highly customizable platform that adapts to specific organizational needs
• Affordable per-user pricing model that scales well with business growth
• Robust mobile app support for Android and iOS devices
• Strong security with data encryption, granular access controls, and 99.9% uptime
• Supports over 22 languages for global workforce management
• Employee self-service portal reduces dependency on HR staff for routine inquiries

Cons:

• Limited third-party integrations outside the Zoho ecosystem
• No direct integration with popular payroll services (though it connects to Zoho Payroll)
• May not offer the same level of customization as some competitors
• Higher-tier plans needed for advanced features like performance management
• Customer support quality varies based on subscription level
• Learning curve for administrators when implementing custom workflows

Zoho People pricing

Zoho People offers a flexible pricing structure with five main tiers:

All plans include employee self-service, document management, and HR automation features. A 30-day free trial is available for all paid plans.

Zoho People best for

Zoho People is particularly well-suited for:

• Small to medium-sized businesses seeking an affordable, scalable HR solution
• Companies needing extensive customization of their HR processes and workflows
• Organizations with remote or distributed teams requiring mobile accessibility
• Businesses already using other Zoho applications who want seamless integration
• Growing companies that need a system that can adapt to increasing workforce size
• International businesses requiring multi-language support and global accessibility

Consequently, Zoho People offers small businesses a cost-effective entry point into comprehensive HR management without sacrificing functionality. Its modular approach allows companies to start with essential features and expand as their needs evolve, making it an excellent choice for those transitioning from spreadsheets to their first dedicated HR system.

GoCo

_{Image Source: GoCo}

Recently acquired by Intuit—the company behind QuickBooks and TurboTax—GoCo has emerged as a flexible HR platform that small businesses love for its customizable workflows and modern interface. This cloud-based solution simplifies everything from onboarding to benefits administration without forcing companies to abandon their existing systems.

GoCo key features

GoCo delivers a robust set of HR capabilities that streamline administrative tasks:

• Customizable workflows: Create automated processes for hiring, onboarding, offboarding, and internal transfers with configurable task assignments and approvals.
• Digital documentation: Convert existing forms into digital documents with e-signature capabilities, eliminating paperwork while maintaining compliance.
• Benefits administration: Simplify benefits enrollment with paperless processes and digital plan comparison tools that empower employees to make informed decisions.
• Payroll flexibility: Choose between GoCo’s embedded payroll solution (powered by Gusto) or integrate with your existing payroll provider through their sync functionality.
• Employee self-service: Enable team members to update personal information, download pay stubs, request time off, and access company resources independently.
• Time tracking: Assign job codes to track time spent on specific projects or clients, with detailed reporting and audit logs for accountability.
• Performance management: Conduct structured reviews, set goals, and collect continuous feedback to develop and motivate employees.

GoCo pros and cons

Pros:

• Highly customizable platform that adapts to existing business processes
• Exceptional customer support with dedicated representatives
• Smooth implementation process completed in just a few weeks
• Strong mobile accessibility for remote and hybrid teams
• Seamless integration with various payroll providers
• Modern, intuitive interface that minimizes training requirements

Cons:

• Interface can be challenging for new users due to limited initial guidance
• Limited workflow customization options for complex business processes
• Basic reporting tools lack advanced options for detailed reports
• Mobile app has fewer features than the desktop version
• Some users report occasional slow load times
• Not ideal for companies with more than 250 employees

GoCo pricing

GoCo offers tiered pricing based on company size and selected features:

All plans include a free trial period to test functionality before committing.

GoCo best for

GoCo works exceptionally well for:

• Small to mid-sized businesses with fewer than 250 employees seeking streamlined HR management
• Companies prioritizing flexibility who want to maintain existing payroll relationships
• Organizations with hybrid or remote teams needing accessible HR tools from anywhere
• Businesses in rapid growth phases requiring scalable HR solutions
• Software and SaaS companies looking for HR tools that match their tech-forward culture
• Companies transitioning from manual processes to their first dedicated HR system

At its core, GoCo stands out because 100% of customers report saving time each week after implementation. This time savings translates directly to reduced operational costs and increased focus on strategic initiatives rather than administrative tasks.

Homebase

_{Image Source: Homebase}

With over 100,000 small businesses already on board, Homebase positions itself as “the everything app for hourly teams” that streamlines scheduling, time tracking, and HR functions. This cloud-based platform specifically targets small businesses managing shift workers, helping them handle day-to-day operations more efficiently.

Homebase key features

Homebase offers a comprehensive suite of tools designed with hourly workers in mind:

• Intuitive scheduling: Build, share, and automate work schedules based on labor costs and sales forecasts while allowing employees to trade or pick up shifts through the mobile app.
• Flexible time tracking: Convert any smartphone, tablet, or desktop into a time clock with GPS location verification for remote workers and automatic calculation of hours, overtime, and breaks.
• Integrated payroll: Process payroll with automatic tax calculations and filings across all states, offering both manual runs and auto-payroll options with direct deposit capabilities.
• Hiring and onboarding: Post job openings to platforms like ZipRecruiter and Indeed for free, manage applicants, and streamline onboarding with digital document signing.
• Team communication: Connect with individuals, groups, or your entire company through built-in messaging that includes shift reminders and announcements.
• HR and compliance: Store employee certifications, track required breaks, calculate overtime, and stay compliant with labor laws through built-in rules and reminders.
• POS integrations: Connect with 25+ software solutions including point-of-sale systems to optimize scheduling based on sales data.

Homebase pros and cons

Pros:

• Free plan available for businesses with a single location and up to 20 employees
• User-friendly mobile app that hourly workers actually use
• Labor cost tracking helps control your biggest expense
• Excellent customer support that understands small business challenges
• Strong team communication tools for coordinating shift workers
• Seamless integration with popular POS systems

Cons:

• Payroll requires an additional fee beyond the base subscription
• More focused on hourly teams than salaried employees
• Per-location pricing model can become expensive for businesses with multiple locations
• Some users report occasional glitches with the shift scheduler
• Limited project management capabilities
• Some advanced HR features require higher-tier plans

Homebase pricing

Homebase offers four primary subscription tiers plus add-ons:

Popular Add-ons:

• Payroll: $39.00/month base fee + $6.00/month per employee paid
• Tip Manager: $25.00/month per location
• Background Checks: $30.00 each
• Task Manager: $13.00/month per location

Homebase best for

Homebase excels as an HR solution for:

• Small retail and service businesses with hourly workers – over 100,000 small businesses rely on the platform
• Restaurants and hospitality businesses – these industries make up nearly 30% of Homebase’s customer base
• Single-location operations looking to maximize value from the pricing structure
• Businesses managing shift workers who need flexible scheduling and time tracking
• Companies with fewer than 50 employees – 80% of Homebase customers fall into this category
• Businesses transitioning from paper schedules to digital workforce management

Generally, Homebase works best for businesses looking to simplify the management of hourly teams without overwhelming complexity or cost. Its focus on practical, everyday HR tasks rather than enterprise-level features makes it particularly suitable for small business owners who need to manage scheduling, attendance, and basic HR functions efficiently.

Deel

_{Image Source: Deel}

Trusted by over 35,000 companies worldwide, Deel stands out as a global HR platform that effectively solves the compliance headache for small businesses hiring internationally. Initially designed for contractor management, this platform has evolved into a comprehensive HR solution handling everything from hiring to payroll across 150+ countries.

Deel key features

Deel offers a powerful suite of tools centered around global workforce management:

• Comprehensive HRIS: Access built-in HR features included with any Deel product purchase, enabling centralized management of employees, contractors, and vendors in one system.
• Global compliance: Navigate employment regulations across 150+ countries with automatically updated legal templates and real-time policy alerts that eliminate compliance guesswork.
• Flexible payment options: Process payments in 150+ currencies through 15 different payment methods, including bank transfers, digital wallets, and even cryptocurrency.
• Contractor management: Simplify hiring, payments, and compliance for global contractors with automated localized contracts and tax document management.
• Employer of Record services: Hire employees globally without setting up local entities, with Deel handling legal employment, tax, payroll, and benefits administration.

Deel pros and cons

Pros:

• Unmatched global coverage spanning 150+ countries
• Powerful automation that reduces administrative time by up to 70%
• 24/7 customer support for both employers and contractors
• Seamless integration with accounting platforms like QuickBooks and Xero
• Centralized dashboard providing valuable workforce insights and analytics

Cons:

• Higher pricing compared to competitors focused on domestic HR
• May feel overwhelming for businesses operating in a single country
• Less robust HRIS functionality than some established competitors
• Customer support quality can vary depending on region
• Implementation may require significant time investment

Deel pricing

Deel best for

Deel works exceptionally well for:

• Small businesses expanding internationally without resources to establish legal entities abroad
• Companies managing both contractors and employees across multiple countries
• Startups needing to quickly onboard international talent
• Organizations prioritizing compliance in contractor classification
• Businesses requiring flexible payment options for global team members

Throughout its development, Deel has remained focused on removing barriers to global hiring, making it an ideal solution for small businesses with big international ambitions.

Paychex

_{Image Source: Paychex}

Paychex stands as one of the most established names in HR and payroll services, processing payroll for approximately one out of every 12 American private sector employees. Founded in 1971, this platform has expanded beyond payroll to offer comprehensive HR solutions designed to help small businesses navigate complex workforce management challenges.

Paychex key features

Paychex Flex, their flagship platform, combines several essential HR functions:

• Payroll automation with processing in as few as two clicks via web or mobile app, plus automatic tax calculation and filing
• HR management tools including employee onboarding, handbook creation, and document storage
• Time and attendance tracking with multiple options including touchless clocking and geofencing technology
• Benefits administration for health insurance, retirement plans, and workers’ compensation
• Compliance support from their team of specialists who monitor regulatory changes across different states
• Analytics and reporting with over 160 standard reports and custom report-building capabilities

Furthermore, their unique Voice Assist capability allows hands-free payroll review and approval, making the platform more accessible than many competitors.

Paychex pros and cons

Pros:

• Extensive compliance expertise with dedicated specialists monitoring regulatory changes
• Flexible payroll options including same-day and real-time payments
• #1 401(k) recordkeeper in the U.S. with integrated retirement services
• Modern, intuitive user interface following recent platform updates
• Free carrier feeds automating benefits data transmission
• Customizable service levels from self-service to fully managed options

Cons:

• Complex, opaque pricing requiring consultation with sales representatives
• Customer support sometimes involves routing through multiple specialists
• Better suited for businesses with fewer than 200 employees
• Higher cost structure compared to some competitors
• Potential for overlapping services offered by different divisions
• Not all features are natively integrated

Paychex pricing

Paychex offers tiered pricing with these primary plans:

Paychex best for

Paychex works particularly well for:

• Small to mid-sized businesses with fewer than 200 employees
• Companies requiring comprehensive payroll tax support across multiple states
• Businesses seeking integrated retirement plan management
• Organizations needing flexible HR support options from self-service to fully managed
• Companies prioritizing accessibility features in their HR technology

Yet, the platform may not be ideal for larger enterprises with complex configurations or businesses seeking the absolute lowest-cost solution.

Comparison Table

HR Software Comparison Table

Conclusion

Choosing the right HR software represents a critical decision for small businesses looking to streamline operations and focus on growth rather than administrative burdens. Throughout this review, we’ve examined seven affordable HR platforms, each offering unique advantages for different business needs.

Small businesses must consider several factors when selecting an HR solution. First, evaluate your specific requirements—whether you need comprehensive payroll processing, international hiring capabilities, or hourly worker scheduling. Second, assess your budget constraints, as prices range from free options like Zoho People’s basic plan to more robust solutions costing $20+ per employee monthly.

BambooHR works exceptionally well for companies transitioning from spreadsheets to their first HR system, while Gusto shines with its intuitive interface and automated tax filing capabilities. Zoho People offers remarkable value for budget-conscious organizations, whereas GoCo provides outstanding flexibility for businesses with existing payroll relationships. Homebase stands out for retail and service businesses managing hourly workers, Deel excels at international hiring, and Paychex delivers comprehensive compliance expertise across multiple states.

Remember that the best HR software ultimately depends on your unique business situation. Many providers offer free trials, allowing you to test their platforms before committing. This hands-on experience often proves more valuable than feature comparisons alone.

We recommend starting with a clear assessment of your current HR pain points, then narrowing your options to two or three platforms that specifically address those challenges. This focused approach helps prevent feature overload and ensures you select a solution that truly transforms your HR operations rather than complicating them.

The right HR software should feel like gaining an additional team member—one that works tirelessly behind the scenes, reduces administrative burdens, and empowers your employees. Your chosen platform will likely become the technological backbone of your people operations, making this decision worthy of careful consideration.

FAQs

Q1. What factors should I consider when choosing HR software for my small business? When selecting HR software, consider your specific needs, budget, number of employees, required features (like payroll, time tracking, benefits administration), ease of use, scalability, and customer support quality. Also, look for solutions that offer free trials to test their functionality before committing.

Q2. How much does HR software typically cost for small businesses? HR software costs can vary widely, ranging from free basic plans to $20+ per employee per month for more comprehensive solutions. Many providers offer tiered pricing based on features and number of employees. It’s important to factor in both base fees and per-employee costs when budgeting.

Q3. Can HR software help with compliance and legal requirements? Yes, many HR software solutions offer compliance support features. They can help with tax filings, labor law compliance, and keeping up with regulatory changes. Some platforms, like Paychex, even provide access to HR specialists who can offer guidance on complex compliance issues.

Q4. Is it possible to manage international employees using HR software? Absolutely. Some HR platforms, like Deel, specialize in managing international workforces. They offer features for global compliance, multi-currency payments, and contractor management across numerous countries. However, not all HR software is equipped for international hiring, so it’s important to choose carefully if this is a requirement.

Q5. How can HR software benefit my small business? HR software can streamline many time-consuming tasks, reducing administrative burdens and potential errors. It can automate processes like payroll, time tracking, and benefits administration, improve employee self-service capabilities, enhance compliance, and provide valuable insights through reporting and analytics. This allows small business owners to focus more on strategic initiatives and growth.