HR Software for growing UK businesses: Payroll, Compliance & Growth

Growing UK businesses need modern HR software because we are all under more time pressure than ever before. Modern HR software can centralise data, offer self-serve access for employees and automate repetitive tasks—freeing up valuable time to focus on high value work. 

According to Personio’s Workforce Pulse report, 50% of HR decision makers are struggling to fill vacancies and 46% report difficulties in leveraging people data—both of which are areas that good HR software can help with.

With the right software, HR teams can: 

• Centralise people data: Store employee records and docs in one place, for easy access and better version control

• Reduce manual admin: Save time on day-to-day admin tasks with workflows, employee self-serve options and built-in templates 

• Automate workflows: Turn repeated processes into seamless workflows that run automatically, with less human input required

• Stay compliant: Choose software that records data in a legally-compliant way, with reminders and safeguards that help you meet your obligations

• Use one tool instead of many: Switch from using several different tools to one all-in-one HR platform, saving you time and money

• Scale without friction: Use the features you need now and benefit from the rest in the future as you grow, without moving all your data to another tool

• Attract and retain top talent: Improve the candidate and employee experience, so you can attract (and keep) the best talent

• Boost employee engagement: Invite feedback and monitor employee happiness, allowing you to make the right decisions

• Create and analyse reports: Use your HR data to identify trends and opportunities, or share reports with leaders and stakeholders

• Reduce costs: Save money by cancelling unnecessary software subscriptions and reducing time spent on HR admin.

You don’t need to stick with manual admin, spreadsheets, or the legacy tool you’ve always used. There’s a modern HR software platform out there that can save you time, money, and energy.  

There are many types of HR software, including Human Resources Information System (HRIS), Human Resources Management System (HRMS) and Human Capital Management (HCM). Some HR platforms combine multiple tools and features, while others focus on one area—like recruitment or payroll. 

Popular types of HR software in the UK include: 

• HR Information Systems (HRIS): A simple HR tool designed to help with admin, employee data management and absence management 

• HR Management Systems (HRMS): A more complete HR platform that also includes features like payroll, performance management, onboarding and recruitment

• Human Capital Management (HCM): The most comprehensive of the major types of HR software, with extra features designed for fast-growing or larger businesses—like workforce planning, talent development and more in-depth compensation management

• Payroll software: A standalone platform for payroll management, often available alongside accounting software (or as an integration for a HRIS or HRMS)

• Applicant tracking system (ATS): A recruitment tool that allows teams to advertise jobs, score candidates and progress them through the hiring process.

You can also find standalone tools for time tracking, employee engagement, performance management, and learning and development. These features are often included with a HRMS or HCM, but are less common with a HRIS. 

Growing businesses should look for HR software that includes core HR features like employee records, absence management and time tracking. Other useful features include performance management, onboarding, employee engagement and preliminary payroll. 

Here’s why these features are a must-have for mid-sized businesses in the UK:

Manage all your employee data securely from one central location. Keep employee records, contracts, payslips and essential documents safe within a digital employee file. 

Easy access to HR data makes it easier for everyone to find the information they need and make the right decisions. If you choose a HR platform that’s optimised for the UK (like Personio), you can also rest easy knowing that your HR data is stored according to relevant data protection legislation.

Time-off management is a core part of any HR software. This feature allows you to set absence policies, track time off, process leave requests and see absence data at a glance.

Tracking absences is essential for payroll purposes and compliance with UK laws. Using software to do this (instead of spreadsheets or calendars) saves you time, reduces errors and makes it easier to identify absence trends.

Recruitment tools like applicant tracking systems (ATSs) enable you to post job ads, screen candidates, schedule interviews and make offers in one secure platform. 

Having a built-in recruitment feature means you don’t need to invest in standalone software to manage hiring and support growth, and everyone benefits from a smoother recruitment process. 

Create a clear and repeatable way to welcome new hires. Build customisable workflows, request essential documents, track progress and make sure nothing gets missed.

A dedicated onboarding feature ensures that it’s never an afterthought, and that every new employee enjoys a seamless new hire experience. You also save time on back-and-forth admin with employee self-serve, automatic reminders and a clear onboarding timeline. 

Keep track of working time and make it easy for employees to log their hours from their desk, phone, or when they walk in the door. 

Built-in time tracking allows you to stay compliant with legislation around working time and your own company policies, as well as giving you accurate data for payroll. 

Performance management software allows you to run automated performance cycles, collect employee feedback from multiple sources and track progress against performance goalsHaving performance management tools within your HR software saves you money compared to investing in a standalone tool. It’s also easier to keep track of progress, identify trends and create a feedback culture with everything in one place.

Understand what drives your employees and surface ideas with employee engagement tools like polls and surveys. Use expertly-created templates or customise your own questions to gather insights on what matters most.

Turn survey data into share-ready presentations and reports, and visualise information in real-time dashboards. Offer employees the ability to give feedback anonymously with confidential surveys, and use Personio’s whistleblowing feature to support compliance with UK best practice.

Preliminary payroll software allows you to gather, prepare and check employee data before passing it on to your accountant or transferring it to your payroll software. Integrations with popular software like Sage 50, Xero and PwC allow you to sync data seamlessly between platforms.

Removing manual work helps reduce errors and supports easier compliance with relevant HMRC legislation (like Real Time Information (RTI)) at the same time.

Store all your HR data together and get clear insights into what the figures show. People analytics tools enable you to view, filter and sort data, and turn it into useful reports.

Analytics dashboards and reports allow you to spot trends and identify challenges before they become a real problem, and make more strategic decisions about policies, employee experience and growth. 

Integrations extend the functionality of your HR software and make it easier to sync data between tools. Popular integrations connect your HR data with payroll, team communication, recruitment, accounting and workforce planning tools–including MuchSkills, Shiftbase and Trace. 

Your chosen HR software should integrate with the tools you currently use and love, or connect seamlessly with alternatives that give you an even better experience. Integrations with other tools in your tech stack are essential for data accuracy, productivity and efficiency.

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The UK provides a lot of protection to employees through legislation, which means that HR managers need to be aware of relevant laws and how to stay compliant. Basic tools don’t make this easy, but the right software can reduce your worries around HR compliance.

Here’s what you need to know and how Personio helps with UK HR compliance:

Personio supports compliance and gives HR teams confidence. According to Personio’s Power of Personio report, 63% of users found it significantly easier to be compliant with legal requirements, and 69% felt more confident about data security.

The cost of HR software depends on the type, what’s included in the package and the size of your business. And while you can find freemium software, it’s often better to invest in the platform that’s the best fit for your business—even if it costs a few pounds more per month. 

The best HR software has a real impact on your bottom-line. According to Personio’s Power of Personio report, users reported overall HR cost savings of 13%. Other savings include a 50% reduction in re-running payroll and a cost reduction of 44% due to avoiding human error.

Features, compliance and pricing are all useful ways to compare HR software—but how do you choose the right one for your business? To find your best-fit software, follow these steps: 

1. Identify your needs: What’s your most important goal? What problem do you need to solve?

2. Evaluate key features and functionality: Which features are a must-have?

3. Consider integrations: Does the software work with tools you already use?

4. Assess user experience: Is it easy to use? 

5. Evaluate scalability and flexibility: Can it support and enable growth as you scale?

6. Review security and compliance: Is it compliant with UK employment law?

7. Compare pricing: Is it affordable? How does the pricing compare to alternatives?

8. Look for recommendations: What do user reviews say? Is it highly recommended?

9. Request a demo: Can you try the software out? 

10. Make your final choice: Is this the right HR software tool for you?

When you’re comparing HR software for UK businesses, look for signals that they cater to your specific industry. Tech startups, retail businesses and manufacturers all have unique needs, and your chosen HR software should be able to meet them. 

For example, here’s how Personio supports different industries: 

UK businesses choose Personio because we understand the unique landscape of HR in the UK. From following payroll rules to meeting your obligations for working time and data protection, we know how important it is for your HR software to make compliance easier.

Here’s why Personio is an ideal choice for growing UK businesses:

• All your HR data in one place: Centralised employee data, records and documents

• Workflow automation: Personio users report an average of 39% increase in productivity, representing a saving of up to 16 hours per week per team member

• Smooth setup experience: Dedicated Personio team member to support you through the implementation process

• Support for payroll: Preliminary payroll and integrations with popular payroll software

• Compliant with UK legislation: Designed with data security and UK-specific compliance in mind

• Built to support growth: Features for smoother scaling, including recruitment, onboarding and cross-border compliance

• Expert customer support: A support team that knows about the unique challenges facing UK HR teams

• Trusted by UK companies: More than 14,000+ organisations trust Personio as their HR system of choice, including LUSH, Mindful Chef, and Premier Inn.

Your HR software should support compliance, make payroll easier and unlock growth. That’s exactly what Personio does.

Personio’s intelligent HR platform has everything you need for core HR, recruiting, performance and development and more—including payroll and UK compliance. 

Yes! Personio supports UK payroll, including preliminary payroll. Personio also has native integrations with popular payroll software like Xero, Sage 50, ADP and PwC.

Yes, Personio is GDPR compliant and UK GDPR compliant. Personio complies with the essential requirements of the GDPR, and data protection is by-design and always-on. For more details, see our security and trust page.

Personio has a marketplace of 200+ integrations available to all users. Some of the most popular SME HR software UK integrations include Slack, Microsoft Teams, Zapier, Google Calendar, Xero and Sage 50. 

On average, it takes four weeks from the contract sign date until Personio is ready for use within your company. A dedicated contact person will be available to support you throughout the setup and implementation process.

The best HR software for a UK midsize business is a HR Management System (HRMS) like Personio as you can take advantage of the full range of core HR, payroll, recruitment and performance management features to support compliance, employee growth and productivity. 

The best RTI payroll software in the UK is the one that’s easy to use and integrates with the rest of your HR tech stack. If you choose Personio for your HR software, it can also act as your UK payroll compliance software, with preliminary payroll and integrations with Sage 50, Xero and PwC.