11 HR software tools ideal for small businesses

When your team reaches a certain size, you’ll quickly realise that investing in human resources (HR) support is vital if you want to stay compliant and get the best out of new and existing hires. For most small businesses, a flexible and affordable HR solution is the best option. 

HR software – also known as an HR management tool – is typically modular, with a core product that offers basic features, and more premium tiers with add-ons like recruitment, payroll, and absence management software. You can also find more specialist tools that offer limited functionality for recruitment or payroll.

Maciek Kubiak, head of people at PhotoAiD, simply uses a recruitment platform. “It is useful for conducting pre-employment tests for potential candidates,” he told Small Business. “It makes the recruitment process quicker and more effective. Plus, it is easy to use and permits to save time and focus on valuable applications, managing talent more efficiently.”

For the purposes of this article, we’ll be looking at platforms which provide multiple HR functions.

In this article we’ll cover:

• • Which software to choose?

• • Paid-for or free software?

• • Cloud-based or on-site software?

• • The top 11 HR software providers for small business

• • HR software comparison – what features do they offer?

• • Next steps

>See also: A guide to outsourcing HR

Which HR software should I go for?

Pam Hinds, head of HR at RotaCloud, comments: “When it comes to choosing HR software tools for a small business, one of the main things you need to consider is – does it have all the features you need? This could be anything from absence and annual leave tracking to recruitment support or performance management tools. You don’t want to risk paying for a system that has lots of functionality that you won’t use, or a service that doesn’t do everything you need it to. So, it’s important to know the key features you need from your software, or problems you need to address, from the outset. 

Once you’ve narrowed down a shortlist of software that has the features you require, Hinds highlights other key points to consider: 

• • Usability. How easy is it to set up and use? Is there a steep learning curve or can you jump straight in?

• • Integrations. Does it integrate with the software and tools you already use? For instance, time and attendance software that integrates with your payroll software?

• • Security. Will you be storing important or sensitive information? How secure is the system?

• • Customer service. Is it easy enough to get support if you encounter an issue?

• • Scalability. How scalable is the system? Is it easy to add or remove employees from the system as you grow, and is the price for doing this clear and transparent?

• • Price. Is it within your budget?

Alper Yurder, general manager of Witco, advises you to look for customisation, for features that are essential to, and can grow with, your business.

“You’re not just getting HR software tools for now, you’re getting tools for the business you want to be. It’s about future-proofing,” he told Small Business. 

“The right software depends on the culture of your business too – and in some cases even the sector you operate. For example, if you’re in a highly regulated business such as healthcare or finance, certain tools might be a better fit than others.”    

You’ll want to factor in the ethics of the software company you go with. “Make sure the values of your provider that you go with are in line with the ethics of your own company,” said Yurder.

>See also: Top 10 HR tips

Should I use paid-for or free HR software?

Another important question you want to ask yourself is how much you want to pay or if you’d be willing to go for a ‘freemium’ product which comes with free features and extra costs for additional features.  

Hinds points out that there are plenty of free or lower cost options on the market, depending on what your needs are. “However, there are often limits or caps with free systems, on things like number of users, amount of storage, the features you can use and access to support,” she said. “So, it’s important to look at what’s included, and excluded, in free versions of software to save you from getting set up and trained, then realising that a specific feature you need is in a paid tier.”

>See also: How to decide on HR policy for your small business

Cloud-based vs on-site server

Another point to consider is choosing between something cloud-based or on an on-premises physical server.

“Cloud software is always available, and everyone can log into it, from anywhere,” Hinds told Small Business. “But with server-based software, you can often only access it from a set location, and if your server goes down, all your software goes down with it and remains inaccessible until it’s fixed.” 

Cloud-based HR systems are popular because you can access them from virtually anywhere, and you don’t need a hefty on-site server to run it. However, some argue that having data saved on a physical server is more secure than saving it in the cloud, as there is restricted access, according to Hinds. “Which option is best for you may depend on the existing hardware and infrastructure set-up of your business.”

“More and more services are moving towards the cloud these days. There are more pros than cons,” said Yurder. “Cloud-based software is more agile – you benefit from product updates instantly. It’s also more secure, given that providers create infrastructure that you wouldn’t be able to create yourself.”

Best HR software tools for small businesses

We’ve listed the best HR software tools below, including a run-down of key features and integrations that can work with your existing software. A lot of software providers offer largely similar services, but the core features listed are those on their most basic package.

Best for employee management

Sage HR

Sage HR is a comprehensive HR management software designed for small and medium-sized businesses. It streamlines recruitment, employee engagement, and talent management, offering tools for leave management, performance tracking, and employee database organisation.

With a user-friendly mobile app, modular add-ons, and seamless integrations, you can build a tailored package from Sage that delivers everything you need with nothing to spare. There’s a 30-day free trial and no long-term contracts or commitments.  

Key features:

• Core HR & employee records – centralised database for all staff details and documents.

• Leave & absence management – employees request time off, managers approve quickly, with shared calendars to avoid clashes.

• Performance management – set goals, run appraisals and collect feedback to track progress.

• Timesheets & shift scheduling – track working hours, approve overtime and manage staff rotas.

• Expenses management – staff upload receipts and submit claims, managers can approve via desktop or mobile.

• Recruitment tools – post jobs, track applications and manage the hiring process

Pricing (excluding VAT): 

Core HR + Leave Management: starts from £4.60 per employee/month

Optional Add-ons:

Performance Management: £2.30 per employee/month
Timesheets: £2.30 per employee/month
Shift Scheduling: £2.30 per employee/month
Expenses: £1.15 per employee/month
Recruitment: £170 per month

Sage HR offers a 30-day free trial.

Find out more

Best for customisation

Breathe HR

Breathe is designed for busy small businesses across the UK, giving you everything you need to manage your people in one simple, secure package. From booking holidays to tracking performance, Breathe takes the hassle out of HR so you can focus on growing your business.

It’s all built around the Core HR package, which offers a staff holiday planner, sickness and absence tracking, performance management and an HR dashboard with tracking. It’s customisable, so you can add on modules. A free pro-rata holiday entitlement calculator is available on the website too.

Key features:

• Holiday & absence management – staff can book holidays online, and managers can approve in a couple of clicks. Breathe also offers a free tool for calculating employee holiday allowance 

• Performance management – set objectives, run appraisals, book 1-2-1s, recognise achievements.

• Document storage – keep contracts, policies and staff docs safe in one secure, GDPR-compliant place.

• Reporting & dashboards – easy-to-read insights on sickness, holidays and other trends.

• Self-service portal – employees log in to update details, request time off, or check policies themselves.

• Optional extras – bolt on modules like recruitment, expenses, or rota & time tracking as your business grows.

• E-signatures – a new feature available on all plans, e-signatures allow you to review, sign and send important documents like contracts from within the Breathe platform.

Price

Pricing starts from £22 per month per organisation for Core HR for micro businesses of 1-10 people. The cost then scales in-line with the number of employees your business has. E.g. from 11-20 employees is £39 per month per business, from 21-50 is £89 per month per business, and so on.

You can then add optional modules to suit your needs, which means you only pay for what you use.

Module add-ons

Rota, time and attendance: £10 per month
Recruitment: £21 per month
Expenses: £12 per month
Learn: £12 per business per month

A 14-day free trial is available.

Find out more

Best for health and safety support

Best for AI support

Employment Hero

Employment Hero’s AI-powered platform allows you to manage hiring, HR, payroll, and employee engagement all in one place.

You get an allocated payroll partner who can support with pay calculations and compliance, and an AI hiring tool that helps you discover the best candidates for your business. You can also access employment law support from professional UK advisors.

Key features:

• All-in-one HR, payroll & hiring – manage recruitment, onboarding, payroll, employee benefits and day-to-day HR in one platform.

• Employee self-service app – staff can request leave, log timesheets, view payslips, update details and access perks from their phone.

• Learning & development tools – built-in training modules, goal-setting and resources to support career growth.

• Smart recruitment & onboarding – applicant tracking, automated candidate matching and streamlined workflows for new starters.

• Compliance & reporting – tools to manage employment law compliance and generate detailed HR and payroll reports.

• Perks & employee benefits – access to perks, discounts and wellbeing extras designed to boost engagement.

Plans:

HR Standard: Starts from £40 per month. Includes leave management, onboarding, documents, and a free payroll plan.

HR Premium: Starts from £70 per month. Adds performance tracking and reviews, expense management, and milestone recognition.

HR Platinum: Adds company goal setting, 1-2-1 templates,  and in-app custom branding.

Employment Unlimited: Includes HR, payroll, hiring and employee management, as well as expert support and learning management

Pricing for Platinum and Unlimited is available on request. Contact Employment Hero to try a demo of the software.

Find out more

Best for employee engagement

HiBob

HiBob, commonly known as Bob, is a next-generation HR platform designed to improve productivity, engagement, and retention for your small business. The platform simplifies all your key HR functions, with automated workflows, people analytics, document management, and more, helping companies to streamline their operations.

Key features:

• Core HR & People Data Management – everything from employee records and org charts to personal profiles is in one place.

• Onboarding, Time & Attendance, Time Off – tools for welcoming new hires, tracking hours/work cycles, submitting and approving leave.

• Performance & Learning – performance reviews, continuous feedback, goal-setting, opportunities for staff learning and growth.

• Engagement & Culture Tools – social-style newsfeeds, recognition (Shoutouts, Kudos), pulse surveys and ways for people to connect.

• Analytics & Reporting – dashboards to track things like turnover, absence, headcount, trends, plus custom reports.

• Compensation & Payroll Integration – tools for managing compensation cycles, bonuses and equity, and integrations to help connect payroll.

Enquire for custom pricing. 

Find out more

Best for growing businesses

SafeHR

Safe HR has all the holiday, sickness, and pay management features that help make your life easier when your team is growing rapidly. 

You can access employee records instantly on any device, all the while safe in the knowledge that you’re complying with GDPR. SafeHR also warns you if Right to Work documents are about to expire, and alerts you to any changes in minimum wage or National Living Wage. 

As well as software, SafeHR has its own in-house legal team and a personalised HR support service that’s on hand to guide you through trickier or more complex issues. 

Key features:

• Holiday & absence management – staff can check allowances, request time off, and see who’s away, with automatic pro-rata calculations for part-timers.

• Payroll & expenses – integrated with accounting software, simple payroll runs, and staff can submit expenses on the go.

• Recruitment & onboarding tools – track applicants, manage new hire checklists, and use e-signatures to speed up the process.

• Performance management – appraisal reminders, tools for reviews, and a record of progress to keep development on track.

• Reporting, alerts & compliance – create custom reports, get alerts for expiring documents, and stay compliant with GDPR and employment law.

• Time tracking & attendance – track hours worked, log timesheets, and monitor attendance accurately.

• Integrations: Xero, Outlook, Google calendar, Cyber Essentials, QuickBooks Online, Comma, PensionSync and Slack

Pricing: 

HR Software-Only: £3.50 per employee per month, £25 minimum (add payroll for £1 per payslip) 

HR support service: £10.00 per employee per month plus £60 flat fee (add payroll for £1 per payslip) 

Recruitment software:

• £15 per month for up to 5 live vacancies
• £25 per month for 6-10 live vacancies
• £40 per month for 11+ live vacancies

Find out more

Best for recruitment

Monday.com

Mondy.com isn’t a dedicated HR solution, but its flexible, workflow-based platform lends itself to HR management, alongside other functions such as software development, marketing and project management.

It offers business users various customisable HR templates, including a recruitment tracker, attendance tracker, holiday tracker, feedback tracker and an employee info template. If you’re a newer business, there are lots of helpful articles on the website to help you with HR and other areas of your small business.

Key features

• Templates & workflows – ready-made HR templates for recruiting, onboarding and time-off, plus flexibility to design your own workflows.

• Recruitment & onboarding tracking – track candidates through the hiring pipeline and manage onboarding tasks and checklists for new starters.

• Leave & absence management – employees can request time off, managers get instant notifications, and calendars show who’s away.

• Performance & feedback tools – set up reviews, gather feedback, and run surveys to monitor performance and engagement.

• Dashboards & automations – visual dashboards to track HR metrics, with automated reminders and approvals to reduce admin.

• Integrations & collaboration – connects with email, calendars and communication apps, helping HR, managers and finance collaborate smoothly.

Pricing (per month, billed annually)

Individual (up to two seats): £0
Standard (per seat per month): £11
Pro (per seat per month): £17
Enterprise: Bespoke

Find out more

Best for security 

Factorial HR

Factorial HR is an AI-powered time, talent, and payroll platform. It automates repetitive tasks like requests and expense approvals; quickly parses, scores and matches CVs; it can summarise feedback and help transform it into meaningful actions; and it can turn your questions into real-time reports. It also has an employee self-service portal, document storage and e-signatures. 

Factorial is big on security. It has data security and a firewall, along with single sign-on on so you don’t need to create a username and password.

An app is available for employees on App Store and Google Play.

Key features:

• Document management – securely store contracts, policies and sensitive files, with custom permissions and digital signatures.

• Time tracking & attendance – track hours worked, approve or reject timesheets, and monitor overtime or extra hours.

• Performance reviews – set up personalised questionnaires, gather feedback and manage employee evaluations.

• Onboarding & offboarding – automate welcome and exit processes with custom workflows and checklists.

• Absence & leave management – employees can request holidays, managers approve in seconds, with shared calendars to avoid clashes.

• Integrations & security – integrates with common tools (email, Slack, etc.) and includes advanced data security with single sign-on.

Pricing

Business: £5.40 a month per employee per month
Enterprise (includes facial recognition, automated processes with custom workflows, document creation and more): bespoke

Recruitment add-ons

Basic (up to ten job offers): £39 per month
Pro (unlimited job offers): £109 per month

Find out more

Best for businesses with no HR team

CharlieHR

CharlieHR automates tedious routine HR tasks, including time-off tracking and requests, performance reviews, policies and contracts, so you have more time to focus on your people. For example, there are custom onboarding forms for new starters and onboarding checklists, so that new employees can easily access the right support. It also offers tools for engagement, documents and data storage. 

Charlie’s perks are a nice feature, and come free with your subscription, allowing you to offer over 30,000 deals and discounts to your employees.

Key features:

• Employee self-service – staff manage their own details, request holidays, and access documents without chasing HR.

• Onboarding & offboarding – smooth checklists and forms for welcoming new starters and handling leavers properly.

• Perks & benefits – employees get access to thousands of discounts and deals included with the subscription.

• Engagement & surveys – run pulse surveys and polls to gather honest feedback from the team. Light-touch micro polls that guarantee engagement. Results are anonymous to improve honesty

• Absence management – track holidays, sick leave and other absences in one simple system.

• Reporting & compliance – generate HR reports quickly and stay legally compliant with built-in templates and guidance.

• Integrations: Pento, Workable, Xero

Pricing

CharlieHR: From £20 per month (1-4 team members). Currently 75% off for the smallest teams. 

Add-ons:

Charlie Concierge: From £20 per month
Charlie Recruit: From £55 per month
Charlie Advice: From £179 per month 

There’s a week’s free trial on all packages.

Find out more

Best for affordability

Zoho People

Zoho People is a cloud-based employee database management system that scales as your company grows. It streamlines all your HR processes, allowing you to deliver great experiences for your employees from the day they join to the day they leave. Features include custom onboarding workflows, time and attendance, performance tracking, and integrated payroll and expenses.

Documents are stored in a classified central vault including policy documents, company handbook and leave policies. For extra security, there are customisable e-signature workflows.

Zoho People works in a variety of languages: French, German, Dutch, Swedish, Portuguese, Italian, Korean, Spanish and more. Perfect for international teams.

Key features:

• Employee database – central, cloud-based records for all staff information.

• Leave & absence management – employees request time off, managers approve, and balances update automatically.

• Document management – store contracts, policies and appraisals securely with e-signatures for approvals.

• Performance & appraisals – set goals, track reviews and gather feedback for development.

• Reporting & analytics – custom reports on absence, performance, or workforce trends.

• Integrations – works seamlessly with Zoho apps plus tools like Google Calendar, Docusign and Microsoft apps.

Pricing (per user per month)

Essential HR: 83p
Professional: £1.50
Premium: £2.50
Enterprise: £4
People Plus: From £3.20 

Add-ons

Employee profiles: Start at 25p per person per month
Zoho Recruit (corporate version): £480 per recruiter per year
Learning management system: £14.40 per user per year

A 30-day free trial is available on all packages.

A ‘Forever free’ service is another option for businesses which have up to five users. It’s a simplified version with absence management and an employee database.

Find out more

Best for employees

Staffology

Staffology, as its name suggests, is designed with staff in mind. It’s great for businesses which have staff who work variable hours as there is a customisable work patterns function for part-time or flexible workers.

Staff can manage their expenses too. The expenses management module means staff can submit and manage their own expenses, which can be submitted from anywhere. You as an employer can run reports into how much each department is spending in order to locate areas of high spend. Build up your HR by using other modules including recruitment, training and performance.

Key features:

• Absence management – track holidays, sickness and other time off in one place.

• Flexible work patterns – handle part-time, shift or variable hours with custom work schedules.

• Employee self-service – staff can submit and manage their own expenses, leave requests and details.

• Reporting – generate HR reports to spot trends in absence, costs or performance.

• Recruitment & onboarding – modules to track candidates and streamline bringing in new hires.

• Integration with payroll – designed to link smoothly with payroll systems to keep pay accurate.

Pricing (per employee per month)

Foundation: £7 per month
Essential: £20 per month
Professional: £39 per month
Ultimate: £59 per month

Find out more

Next steps

Sometimes it’s a case of trying HR software out to get a feel for different tools. Make use of those trial periods where you can!

And if you’re ready to invest in a solution, we can help you find the best platform.

Simply fill in our free quote-finding form, and answer a few questions about your business (it takes less than a minute). We’ll match you with the most appropriate HR support and software provider.

Further Resources

Small business HR – everything you need to know

An HR checklist for UK Small businesses