What is HRIS?

What is HRIS?

Human Resource Information Systems Help You:

  • Store and access employee information in a central database
  • Encourage employee retention with a benefits program
  • Run payroll accurately and efficiently
  • Manage your workforce scheduling
  • Streamline recruiting and onboarding
  • Comply with tax and employment regulations

Store and access employee information in a central database

At their most basic, HR information systems (HRIS) are databases where organizations can keep all the information related to employees, along with company resources, stored in a secure, accessible location.

To illustrate, think of the software as a digital file cabinet. It holds employment forms, employee records, benefits selections and other sources of data.

In companies that have hundreds or thousands of employees, this ability greatly simplifies the process of managing and maintaining employee data. Even small businesses can benefit from the digital nature of HR management software because everything is stored in one location, so it’s much easier to ensure data accuracy and avoid entry errors. A central database eliminates traditional silos among HR applications and provides a single source of the truth. This allows organizations to have a consistent view of data related to payroll, benefits and other key areas of HR.

The system will automatically update when an employee’s information gets changed. If an employee gets promoted to a managerial position, for example, that shift in role would be reflected in their profile. The corresponding salary raise would get logged as well, without the need for someone to manually enter the new salary into the payroll module.

Encourage employee retention with a benefits program

Benefits are one of the biggest perks your organization can offer employees. And research has shown that benefits provide a strong incentive for employees to stay.

The ability to administer benefits is a common feature of HRIS. Some solutions have built-in modules, while others offer standalone benefits administration that can be seamlessly integrated.

Both methods provide the same capability: an interface through which benefits are accessible to your workforce. Often, employees have the ability to log in to their account via an employee self-service (ESS) portal, where they can manage their benefits instead of depending on HR personnel to handle it on their behalf.

Using the portal, employees can choose which plans to enroll in, view their benefits information and update their preferences when necessary. Some innovative solutions include a feature that guides employees on benefit selection so they can make smart, informed decisions.

HRIS can support a broad range of benefits:

  • Health insurance
  • Life insurance
  • 401k plans
  • PTO and sick days
  • Wellness programs
  • FSA and HSA
  • Tuition or scholarship reimbursement

Run payroll accurately and efficiently

Payroll is one of the most critical components of human resources. Without it, employees won’t get paid and taxes can’t get filed. It’s a must-have feature for any company.

Vendors typically provide payroll systems two different ways: either as a standalone solution or as an integrated module of a larger HRIS. In many cases, independent payroll applications are better suited for small businesses, which likely don’t need the advanced capabilities offered by human capital management (HCM) platforms.

The level of functionality varies across solutions, but modern HRIS usually include the following core capabilities:

  • Built-in rules for processing and managing payroll
  • Payment options that let employees choose how they get paid — e.g., direct deposit
  • Employee self-service, which enables employees to view past pay stubs, pay rates, tax deductions and other details
  • Document templates for common compliance forms
  • Multiple pay rates, such as overtime, PTO and sick days
  • Tax calculations, which take relevant criteria into account to automatically populate forms

Advanced systems contain additional features. For example, reporting and analysis tools, which let users track budgets, forecast future costs, examine compensation and gain other insights.

Payroll systems also need to integrate with other HR applications such as time and attendance solutions. The data from these solutions ensures payroll amounts are processed correctly every time.

Manage your workforce scheduling

Many HR modules work together to help operations run smoothly. Workforce management software (WFM) is no exception. It includes time, attendance and scheduling components that can enable your company to accurately keep track of schedules for shift workers, employee absences and more.

Common tools you’ll find include:

  • Leave management
  • Forecasts for staff availability
  • Digital time clocks, which use methods such as biometric scan or swipe card
  • Task and activity management
  • Workforce planning
  • Mobile clock-in and clock-out capabilities, including geofencing
  • Collaborative scheduling
  • Labor analytics

Workforce management platforms are also equipped with security features and the ability to integrate with payroll.

Streamline recruiting and onboarding

The people you hire are your most important asset. Talent acquisition software makes it easier to find the right talent while streamlining the process from first contact through the onboarding phase.

Recruiting tools such as applicant tracking systems (ATS) lay the foundation by letting you post job openings across sites like job boards and social media. They also have features that allow you to schedule interviews and analyze metrics such as cost per hire. And ATS can integrate with software for conducting background checks.

One key element of the recruiting process is artificial intelligence, and more systems are starting to build in AI capabilities.

AI-enabled solutions can greatly reduce the workload of hiring managers on the front end by sourcing the best candidates and vetting resumes, among other things. In some cases, AI can also help reduce hiring bias. However, you have to be careful that the technology itself isn’t embedded with unconscious bias that skews the results.

Once you reach the onboarding stage, it’s critical to provide a positive experience. Part of encouraging talent retention is making the transition from candidate to employee smooth and engaging.

Onboarding features include:

  • A timeline of tasks the new hire needs to complete as part of the onboarding process
  • Digital documents that support e-signatures
  • A portal with resources that welcome and orient the new hire
  • Automation and data syncing
  • Templates for offer letters and other important documents
  • Reminder emails

Comply with tax and employment regulations

Every business, no matter what industry or size, needs to comply with regulatory standards. For companies that operate on a global scale, this requirement becomes much more complex, as they have to account for the nuances of every local jurisdiction.

Local tax and labor laws, as well as GDPR, are just a few concerns.

HRIS alleviates some of that burden by offering tools that ensure your company remains compliant:

  • Built-in local requirements
  • Support for global payroll, including in different currencies
  • A feed that compiles industry news
  • Support for healthcare laws such as ACA
  • Customization options
  • Legal support
  • Configurations based on geographic locations
  • Data control

Keep in mind that this is a general list. The features any specific solution offers vary greatly, and the features you need will depend on your unique situation.

FAQs: The Scoop on HRIS

What Is HRMS?

Human resource management software (HRMS) is a platform that combines tools such as personnel tracking, an employee database, benefits administration, payroll and other modules. HRMS facilitates HR processes and activities within an organization, including workforce management, recruiting, onboarding and business planning.

HRMS is often used interchangeably with human resource information systems (HRIS) and human capital management (HCM), both of which offer similar capabilities.

What’s the Difference Between HRIS, HRMS and HCM?

If you’ve done even a little research into HR software, you’ve probably come across these terms. And if you’re confused as to what the difference is, you’re not alone.

We covered the topic in depth in our HCM vs. HRIS vs. HRMS article, if you want to dig into the nitty-gritty details. If not, here’s the TL;DR version:

There isn’t a universal, agreed-upon distinction between HRIS, HRMS and HCM. Vendors use different terms to describe what their system does, and sometimes those overlap or conflict with how analysts or other vendors refer to systems.

HRIS solutions are the most traditional, while HRMS and HCM have developed more recently and typically include broader offerings. But branding updates by vendors have muddied the waters, and you may find an HRIS and HCM that have the same functionality.

Your best bet when navigating the acronym jungle is to pay less attention to a system’s label and more attention to its capabilities.

What HR Solutions Do I Need?

Every company is unique, so there’s no one-size-fits-all answer. In order to determine what HRIS you should implement, ask yourself the following questions:

  • What are my current needs?
  • What will my future needs be?

In other words, plan for the present and the future. Ideally, you’ll want a solution or suite of products that will serve you well now but that has features you can add on or easily integrate with as your business grows.

Identifying your current needs isn’t too difficult. Payroll is the one solution you can’t live without and shouldn’t try to cobble together on your own. Beyond that, the basic systems you choose should align with your company’s current maturity level.

If you’re just starting out, you probably don’t need to go all-in for a suite of applications that supports global HR, succession planning and other advanced features. But if you have hourly workers or a mobile workforce, time and attendance software will be helpful. It will keep your data updated so it can feed accurate results into payroll and keep schedules organized.

From there, anticipate where you’ll be down the road. Are you planning on expanding operations into another country? If so, you’ll want a solution that can handle global processes.

As another example, if you project rapid growth and the need to hire a large number of new employees, recruitment and onboarding software are wise implementation choices.

What Features Do HRIS Have?

HRIS come with varying levels of capability and complexity, and solutions targeted at larger companies will have deeper functionality. However, we’ve put together an overview of features you can refer to when looking at products for your company:

  • An employee self-service portal
  • Payroll
  • Absence management
  • Time reporting
  • Compliance management
  • Employee scheduling
  • Applicant tracking system
  • Employee performance, including goal setting and reviews
  • Reporting and analytics
  • Benefits administration
  • Mobile applications

What Are the Benefits of an HRIS?

Implementing HRIS brings many advantages, especially for companies that still rely on manual, outdated tools like spreadsheets and paper files.

Here are some of the chief benefits you’ll gain from having HRIS in place:

  • Alleviate the workload of HR personnel via automation
  • Reduce human errors
  • Make processes more efficient
  • Attract and retain top talent
  • Automatically synchronize data in a single system
  • Strategically plan for growth and success
  • Drill into workforce insights
  • Operate globally
  • Ensure regulatory compliance
  • View information from anywhere via mobile apps
  • Measure KPIs with analytics tools and reports
  • Facilitate excellent employee performance

What Are Some Examples of HRIS Solutions?

There are literally hundreds of HRIS out there, and some are more popular and widely adopted than others. Popularity can be helpful. But it’s not as important as finding a product that fits your needs.

So, where should you kickstart your search?

Our HR software product directory is a good starting point. You can look through hundreds of solutions — like ADP Workforce Now, Paylocity and Workday HCM — and sort them by price, company size, industry and other criteria.

For a full rundown of the top products on the market, you can get free access to our HR Leaderboard. It will let you compare products based on a wide range of requirements and read analyst reviews.

How Do I Select an HR Information System?

Investing in any business system is a huge undertaking. The process can involve preliminary research, requirements gathering, shortlisting, price checking, demos — the list is extensive. HR is one of the most critical pieces of your company, so it’s important to make an informed decision that will serve your company well.

Our goal is to make that process more manageable for you. We’ve put together a number of free resources, including a comparison of HRIS. We also recommend checking out our HRIS requirements checklist and our list of the top questions you should ask before implementing HRIS.

When you’re ready to start your selection process, you can access our user-friendly requirements platform that will simplify your search and help you find the right solution for your business.

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HRIS selection is complex and beset with problems for both IT buyers and solution providers. We do 3 things to make it fast and simple:

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Your Guides

Our industry journalists proudly distill the helpful information you read on SelectHub, always on the mission to share what matters so you can make your best decisions independently.

HRIS articles are written and edited by:

Mariah Hansen

Lead Editor

As the lead editor at SelectHub, Mariah edits and manages content for more than 40 different software categories, as well as writing for a couple of them herself.

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Jason Keller

Market Research Associate

Jason Keller is a Market Research Analyst at SelectHub who writes content on Electronic Medical Record Software, Electronic Health Record Software and Marketing Automation Software.

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Thought Leaders

SelectHub has sought out and invited thought leaders to contribute to our HRIS industry articles and resources. These thought leaders ensure we deliver quality content with the most accurate information, focusing on what matters most. No thought leader is compensated for their contributions, but shares our belief that information should be democratized so everyone can make the best decision.

Dave Ulrich

Dave Ulrich

University of Michigan, Ross School of Business Professor

Ranked as the #1 management guru by Business Week, profiled by Fast Company as one of the world’s top 10 creative people in business

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Matt Charney

Matt Charney

Chief Content Officer, Allegis Global Solutions

Matt Charney currently serves as the Chief Content Officer for Allegis Global Solutions, one of the biggest recruiting and staffing organizations in the world

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Dorothy Dalton

Dorothy Dalton

Global Talent Management Strategist

Dorothy works globally in talent management strategy, covering the whole spectrum of career challenges from “hire to retire” in the talent pipeline.

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Art Mazor

Art Mazor

Deloitte’s HR Transformation Global Practice Leader

Art is Deloitte’s HR Transformation Global Practice Leader, part of the Global Human Capital Executive

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Jason Lauritsen

Jason Lauritsen

Author and Consultant, Workplace Culture Expert

Jason Lauritsen is a keynote speaker, author, and consultant. He is an employee engagement and workplace

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Sabrina Baker

Sabrina Baker

Founder, Acacia HR Solutions

I am the founder of Acacia HR Solutions, a human resource consulting firm focused on the startup and small business niche.

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James (J.D.) Conway

Head of Talent Acquisition at BambooHR

James (J.D.) Conway has over a decade of experience in talent acquisition acting as both a third-party recruiter

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Steven Cates

Steven Cates

Graduate Professor of Human Resources Management at Purdue University Global

Professor Steven Cates serves as a Graduate Professor of Human Resource Management in the School of Business and Information Technology at Purdue University Global

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David Millner

David Millner

Founder & Consulting Partner at HR Curator LTD.

Dave has a business background followed by 30 years of internal and external consulting experience in NatWest

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Perry Timms

Perry Timms

Founder and Chief Energy Officer, PTHR

Perry Timms is the founder and Chief Energy Officer of PTHR – an 8-person global consultancy, setting out to create

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