Best Employee Management Software - 2023

“Employee management” is a wide software umbrella. Hundreds of different HR management software solutions (HRMS) can be categorized under it. While that may be the case, the following are some of the most common features you can safely expect from employee management software.

• Storing employee records: An employee management software effectively functions as your employee database. It stores employee information such as names, addresses, designations, salaries, and start dates. You can even store custom employee info such as skills, education, birthdays, emergency contact details, and more.

• Time and attendance tracking: Manually updating timesheets is a tedious task that’s not only time-consuming, but almost impossible to perform without any errors. Incorrectly inputting employee time and attendance data leads to incorrect payroll. With the help of employee management software, you can cut down on human errors and ensure that your payroll is always accurate. 

• Employee scheduling: Employee management software can help you schedule and move around shifts for your employees to ensure that the working hours of your business are sufficiently covered. Depending on what product you use, employees may also be allowed access to the same system to adjust availabilities and request shift changes. 

• Employee self-service portal: The majority of employee management solutions provide employee self-service portals. Employees may use these portals to handle a number of human resources-related tasks that would otherwise require the attention of an HR employee. Most self-service portals allow employees to update personal details such as contact details, addresses, bank account info, and more. Some employee self-service portals also allow employees to put in time-off requests and adjust availabilities. 

• Employee performance monitoring: Most employee management systems allow employers to define goals and productivity metrics and monitor employees’ progress towards those goals and metrics from a single dashboard. Accessing such data enables employers to make informed decisions that drive performance, e.g. identify where certain employees could use some training or if their skills are perhaps more suited for a different role. 

• 3rd-party integrations: The majority of employee management software solutions offer integration options with your existing business tools such as those for recruiting, payroll, enterprise resource planning (ERP), team collaboration, and more to extend the functionality of your software, have your data synchronize automatically and eliminate duplicated effort.
• Additional features: In addition to the above, some employee management systems may also carry features for applicant tracking, onboarding, payroll management, benefits administration, learning management, and employee recognition. 

You can easily make mistakes when choosing an employee management solution if you don’t carefully research and compare what’s available on the market while factoring in the needs and budget of your business. Here are a few mistakes you should avoid:  

• Buying an all-in-one employee management software when all you need is one or two HR functions covered: To give an example, if you only need a system for performance management or attendance tracking, then buy a product that does just that. An all-in-one HR cloud can be quite costly if you’re not putting it to good use. We recommend that you always invest carefully and selectively to make the most out of your budget.
• Choosing an employee management system that isn’t scalable: Your business may see exponential growth within just a matter of months. It may also experience financial hardships, requiring you to downsize your team. No matter what the future holds for your business, you’ll definitely need your employee management software to grow or shrink accordingly.
• Not aligning internally with all departments that could benefit from an employee management system before buying one: Many of the top employee management systems offer features that extend beyond your HR department’s scope. For example, employee management software can have project management capabilities, which means different managers across your company can use it to stay organized and keep track of their team members’ progress. It is also quite common for an employee management system to have payroll processing and benefits administration features, which are typically the responsibility of the finance department and not HR. Since other departments/managers can benefit from your employee management system, make sure you factor in their feedback in your product selection process. ‍
• Making long-term commitments before thoroughly testing a solution: Most software vendors will offer you a discount if you get into an annual contract. Some will even try to tempt you to get into a two-year commitment. While such deals can save you a significant amount of money over time, you should only commit to a vendor after thoroughly testing their software and verifying that it’s the one for you. Otherwise, you will end up going back and forth with them regarding their refund policy and likely incurring a considerable cancellation fee.

The majority of employee management software vendors offer tiered pricing to accommodate different business needs and financial capabilities. Those tiers vary in terms of features and either cost a flat monthly/annual subscription fee for an unlimited number of employees, or have a per-employee-per-month pricing structure, which could cost anywhere between $1.25 - $30 per employee per month. 

Do keep in mind that in all cases, additional fees may still apply for on-demand services such as product training, customization, compliance services, dedicated account management, and cancellation. Consult your selected employee management software vendor on the exact breakdown of their recurring fees as well as the pricing of all on-demand services that are billed separately.

Using employee management software allows you to:

• Secure employee information: Paper files and spreadsheets are not a secure way to store sensitive employee data as they could easily fall into the wrong hands. You can mitigate such risks by using an employee management system instead. The majority of employee management systems are highly secure, with measures such as data encryption and multi-factor authentication to keep your employees’ information safe at all times.‍
• Increase productivity: Using an employee management system helps you automate many processes that are otherwise quite tedious and take up a great deal of your team’s time. When different departments across your company aren’t manually dealing with employee data maintenance, time and attendance tracking, shift scheduling, leave management, etc, they’re able to reinvest that time in other tasks that contribute to your bottom line. ‍
• Improve employee satisfaction: Good HR tech has an impact on employee experience and retention. When employees are managed through outdated channels and processes, it is easy for them to get frustrated and dissatisfied with your company. An employee management software gives your employees a channel to easily update their information, request time off, adjust their shifts, track their performance, communicate with you when needed, and much more - all in an effortless manner.

As you’re researching different employee management software, we always recommend that you schedule demo sessions with the top vendors on your list to make sure their solution is compatible with the needs of your business. Here are a few questions you can ask during your demos: 

• What HR functions does your software cover?/ Can your solution replace other products in my HR tech stack?
• Can you walk me through what employees see through their self-service portal (if any)?
• Does your platform feature Artificial Intelligence (AI) to automate certain processes?
• How easy is it to implement your solution, and would I be able to do it myself?
• What business solutions does your software integrate with?
• What metrics have you used to prove the effectiveness of your solution, and where can I see these in my analytics dashboard?
• What data protection laws are you compliant with? 
• How much does the software cost for my team size?
• How will our pricing change as our team grows or shrinks?
• Will I be assigned a dedicated account manager?
• What are your Customer Support SLAs?
• Do you have a help center with articles and other documentation for self-service?

Implementing employee management software is fairly easy, especially since the majority of them are cloud-based, delivered through a software-as-a-service (SaaS) infrastructure. Getting started with a cloud-based solution is relatively quick. Once you’ve purchased a subscription that meets your needs, you can create an account and start configuring it and importing your employee data. 

On the other hand, some employee management software solutions are self-hosted (on-premise). Self-hosted solutions generally take longer to set up, and depending on your chosen vendor, you may need to consult them regarding their solutions’ compatibility with your current hardware and installation process or better yet, have them do the installation for you.

Note: Most of the vendors we’ve listed in this guide provide step-by-step video tutorials and help docs that assist customers in getting up and running quickly. For more information, you can reach out to your chosen vendor’s support team.

What is employee management software?

Employee management software allows companies to carry out different HR functions, including time and attendance tracking, new hire onboarding, shift scheduling, leave management, employee engagement, and performance management. It may also have features for payroll processing and benefits administration.

What to look for in employee management software?

Besides making sure that employee management software covers the HR/finance functions that you need, see that it is user-friendly, scalable, can integrate with favorite products, and has an employee self-service portal.

Who needs employee management software?

All businesses, regardless of size and industry, can benefit from employee management software to streamline how they store employee information, onboard and offboard employees, as well as drive up employee engagement and performance.

How are employee management software solutions deployed?

The majority of employee management systems are cloud-based, delivered through a software-as-a-service (SaaS) infrastructure. This means you’ll be able to easily access them through most web browsers, either on your desktop or mobile device.
On the other hand, some employee management systems are self-hosted (on-premise). Self-hosted solutions generally take longer to set up, and depending on your chosen vendor, you may need to consult them regarding their solutions’ compatibility with your current hardware and installation process or better yet, have them do the installation for you.

No matter what industry you’re in and regardless of the size of your company, an employee management system is quite useful to streamline different functions across your HR department and beyond. All of the solutions we’ve listed in this guide would make a great addition to your tech stack. All you have to do is: 

• Align with your HR, Finance, and other team managers regarding their needs and expectations before selecting a product; 
• Carefully consider those needs as well as your budget and choose a product that meets them; 
• Request a trial account to test the platform’s features first-hand;
• Schedule demo sessions with different vendors to get all of your questions answered.

Thanks for reading our guide on employee management software. We constantly review the top software vendors in the HR space. If you’re new to HR tech and want to learn more, we recommend you start by checking out our top HRIS, payroll, and benefits administration vendor recommendations.