Introduction: When Does a Growing Business Need HR Software?
Managing employees becomes increasingly complicated as a business grows. While spreadsheets, shared calendars and email might work for a team of 10, these processes can quickly become inefficient when a workforce reaches 50 employees or more.
Holiday requests, employee records, recruitment, onboarding and payroll administration all require greater coordination. Without dedicated systems, businesses risk spending too much time on manual administration and making avoidable mistakes.
HR software helps solve these challenges by bringing employee information and essential HR processes together in one place.
However, not every growing business needs an expensive enterprise platform. The right solution should reflect your current workforce, budget, existing payroll arrangements and future growth plans.
Here’s what to look for when choosing HR software and four providers worth considering.
1. Why Do Businesses Need HR Software After 50 Employees?
Reaching 50 employees isn’t an automatic trigger for every employment law obligation, but it is a good point to review existing HR processes.
As your workforce expands, several areas become more difficult to manage:
- Employee records: Keeping contracts, personal information, training records and employment histories accurate and accessible.
- Holiday and absence: Managing annual leave, sickness and different working arrangements across departments.
- Recruitment: Coordinating applications, interviews, offers and onboarding.
- Payroll: Ensuring salary changes, working hours and absence information are accurately reflected in payroll.
- Compliance: Maintaining appropriate employment documentation, right-to-work checks and workplace pension records.
There are also specific UK obligations worth understanding. For example, the Information and Consultation of Employees Regulations can apply to organisations with 50 or more employees following a valid employee request. Gender pay gap reporting generally applies to private and voluntary sector employers with 250 or more employees.
HR software can help organise information and maintain consistent processes, although it does not replace the need for appropriate employment law advice.
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2. Six Essential Features to Look for in HR Software
When comparing providers, prioritise functionality that solves everyday administrative problems.
1. Employee records and self-service
A central employee database should store contracts, contact details, emergency information, salary records and relevant employment documentation. Employee self-service allows staff to update personal details, access documents and view their information without contacting HR.
2. Holiday and absence management
Look for automated holiday entitlement calculations, digital leave requests, manager approval workflows and shared team calendars. Sickness tracking and reporting are also useful for identifying absence patterns.
3. Recruitment and onboarding
Recruitment tools can help manage applications, interviews and offers. Onboarding functionality should support digital documentation, new starter checklists, induction tasks and right-to-work processes.
4. Payroll integration
Check whether the platform integrates with your existing payroll provider or offers its own payroll functionality. Ideally, employee changes, salary updates and absence information should transfer without repeated manual entry.
5. Performance management
Performance reviews, employee feedback, goal setting and training records help managers monitor development and identify skills gaps as the business expands.
6. Reporting and analytics
Workforce reporting can provide useful insights into employee turnover, headcount, absence, recruitment and training. These insights help management make more informed staffing decisions.
3. All-in-One HR Software vs Specialist Platforms
There are two main approaches to choosing HR technology.
All-in-one HR platforms combine several functions, such as employee records, holiday management, recruitment and performance management.
Advantages include:
- One central employee database.
- Fewer systems and subscriptions.
- Consistent employee experience.
- Less manual data transfer.
However, specialist functionality may be more limited, and additional modules can increase costs.
Best-of-breed platforms use different providers for individual functions, such as HR, recruitment and payroll.
These offer greater flexibility and potentially more advanced specialist features, but require more integrations and ongoing administration.
For many businesses with 50–250 employees, an integrated HR platform is a practical starting point. However, businesses with established payroll or recruitment systems may prefer to retain those providers and connect them to their core HR software.
4. HR Software Providers to Consider
The best HR software depends on your business requirements. These four providers are worth considering when evaluating solutions for UK businesses.
HiBob – Best for Growing Businesses and People Management
HiBob is a modern HR platform designed for growing businesses that want to improve employee experience while streamlining HR administration.
Its features include centralised employee records, onboarding, performance management, employee engagement and workforce analytics.
Best for: Businesses looking to develop more structured people management processes as they scale.
Website: https://www.hibob.com/
Breathe HR – Best for Straightforward HR Administration
Breathe HR is a UK-focused HR software provider aimed at small and growing businesses.
Its platform helps organisations manage employee records, holiday requests, sickness tracking, document storage and onboarding.
Best for: Businesses moving away from spreadsheets and looking for straightforward HR administration.
Website: https://www.breathehr.com/
Moorepay – Best for Integrated HR and Payroll
Moorepay provides HR and payroll solutions designed for UK businesses, combining employee management with payroll administration and additional HR support.
Its offering includes payroll processing, employee records, absence management and employee self-service.
Best for: Businesses looking to bring HR and payroll processes together, with access to additional employment support.
Website: https://www.moorepay.co.uk/
Sage HR – Best for Flexible, Modular HR Software
Sage HR offers a modular HR management platform covering employee records, holiday management, performance management, recruitment and timesheets.
Best for: Businesses wanting flexible HR software, particularly those already using other Sage products.
Check which modules are included and whether separate payroll subscriptions or integrations are required.
Website: https://www.sage.com/en-gb/sage-business-cloud/hr/
HR Software Comparison
| Provider | Best suited to | Main strength |
|---|---|---|
| HiBob | Scaling businesses | Employee experience and people management |
| Breathe HR | Smaller growing businesses | Straightforward HR administration |
| Moorepay | Businesses prioritising payroll | Integrated HR and payroll |
| Sage HR | Businesses wanting flexibility | Modular HR functionality |
5. How Much Does HR Software Cost?
HR software pricing varies depending on employee numbers, functionality and support requirements.
Some providers charge per employee per month, while others offer modular subscriptions or bespoke quotations.
Before committing, consider:
- Monthly subscription and employee limits.
- Additional charges for recruitment and performance modules.
- Implementation and onboarding fees.
- Payroll and integration costs.
- Customer support arrangements.
- Contract length and annual price increases.
The cheapest platform isn’t necessarily the best value. Consider how much administrative time it could save and whether it can accommodate future growth without requiring another migration.
6. Seven Questions to Ask Before Choosing HR Software
Before arranging demonstrations, consider the following:
- Can the platform support our projected headcount over the next two years?
- Does it integrate with our existing payroll and accounting software?
- Is it easy for employees and managers to use?
- Can it accommodate multiple locations and shift-based working?
- Can employee information be exported if we change providers?
- What security and UK GDPR protections are in place?
- What implementation, training and customer support are included?
Ask providers to demonstrate real scenarios, such as onboarding a new employee, approving annual leave and updating payroll information.
Read more – How to Hire International Talent Using an Employer of Record (EOR)
Frequently Asked Questions
What is the best HR software for a business with 50 employees?
The best option depends on your requirements. HiBob, Breathe HR, Moorepay and Sage HR all offer different approaches to employee management, payroll and HR administration.
Do small businesses legally need HR software?
No. UK businesses are not generally required to purchase HR software, but they must meet their employment law, record-keeping and payroll obligations.
Does HR software include payroll?
Not always. Some providers offer built-in payroll, while others integrate with external payroll services. Check exactly what is included before purchasing.
When should a small business invest in HR software?
There is no fixed employee threshold. If managing holiday, employee records, recruitment and payroll is becoming time-consuming, it may be worth investing in a dedicated system.
Conclusion
Choosing the right HR software can make managing a growing workforce considerably easier. For businesses with 50–250 employees, the priority should be finding a platform that reduces administration, improves employee management and integrates with existing systems.
Compare providers based on your actual requirements, request demonstrations and consider future growth before committing. The right platform should support your business today while making it easier to manage the next stage of expansion.
