Press "Enter" to skip to content

Why HR Software Is Vital for Your Small Business

HR software

HR software improves business processes in many ways. First and foremost, it enhances productivity of the entire company.

For the HR department, (or the person in charge of HR in very small businesses), HR software automates a number of systems, which frees up a lot of time.

For employees, HR systems offer a level of self-service, which empowers them with information so they don’t have to bother busy management. Both employees and management can get on with their jobs since HR software reduces the need for so much back and forth.

Additionally, HR systems help companies meet important recordkeeping requirements. It also improves company communication and offers other benefits as described below.

Employee Document Storage

The FLSA and EEOC have specific recordkeeping requirements for various employee records. Employee personnel records must be stored for one year after termination while employee attendance and payroll records must be stored for three years. Other records such as pay rates and evaluations must be kept for two years. It’s a lot easier to store these records online in a central location than have them scattered about filing cabinets and office hard drives.

Performance & Pay Tracking

Tracking employee performance is a good practice for several reasons. First, it helps employees be aware of where they stand with management. When management is open about an employee’s performance, the employee knows what they need to work on and where their observed strengths and weaknesses are. Second, performance tracking can come in handy in case of litigation. This isn’t something any business thinks they’ll ever face, but if they do, supporting records can be extremely helpful.


Communication between employees and management is crucial, of course, but the landscape of communication is changing. Modern tools help bridge the gap between management and employees so that employees feel more comfortable asking for the information they need. It’s also more reliable for management. Managers can use online communication systems, either standalone products like Slack or products integrated into your HR software like

Leave Tracking

If you’re still tracking employee leave with spreadsheets, or worse on paper, it’s time to upgrade to online time off tracking. This is easier on management for a couple of reasons. First, the calculations are automatic. Second, you can easily cross reference between all of your team’s time off requests and their available balances. And last, reporting is more comprehensive and it’s easier to see the data you want and arrange it your way.

Attendance Records

Besides productivity, recordkeeping is one of the most important functions of HR software because it can protect a business from labor lawsuits. A time and attendance system should not only record in and out time records but it should record each edit and action thereafter and save it in an audit trail. This offers a level of protection that spreadsheets and paper just can’t match.

Payroll & Benefits

Often times, payroll and benefits will fall under a separate system all its own. As long as it’s easy to import time tracking records into the system, it could be beneficial to have them separate. Payroll is a very specialized field. Sometimes payroll companies add other services as ancillary components. As a result, they’re not always robust or user-friendly. Consider this when looking for an HR software.


Start using a comprehensive HR system. Get!

Free online timesheets

Related Posts

Leave a Reply

Your email address will not be published. Required fields are marked *