What Is Payroll Software Integration?

Payroll software integration happens when you sync your payroll system with other software, for instance, with an accounting program. It saves you from having to enter the same payroll information into two separate programs and even allows your employees to do some of the work for you. Payroll software commonly integrates with HR, time and expense tracking, and bookkeeping software. These integrations create seamless workflows and automate many of the processes it takes to pay employees on time.

You can find integrations for a wide range of tasks, depending on which payroll software you use; some are built to integrate with more systems than others. The products vary in price from free to subscriptions with a monthly and per-employee fee. If you are still not sure which payroll provider is right for you, you can learn more in our how to choose a payroll software article. Be sure to consider services that offer a wide range of software integration capabilities.

Most Common Software Integrations With Payroll Systems

1. Time and Attendance Software

This software lets employees track work hours. Some offer mobile clock-in and clock- out, location and geofencing (meaning you can restrict the physical location of where employees clock-in), and notes or categories for employee work hours that may be charged to clients.

Homebase is a popular time and attendance software that many payroll systems integrate with; you can also use it for free if you have one physical location. For more time and attendance options, check out our buyers guide on the Best Time and Attendance Software.

2. Employee Scheduling Software

These apps let you build schedules, see who’s available, track shift swap, and budget your labor resources. By integrating with payroll software, you can send time sheets, paid-time-off, and employee positions for easy payroll calculations. You won’t have to enter each individual employee’s work time either.

When I Work is one of the best employee scheduling apps that integrates with many popular payroll software; it’s free to use if you have less than 75 employees. Check out our buyers’ guide to learn about more of the Best Employee Scheduling Apps.

3. Accounting Software

By integrating your payroll system with accounting software, you can ensure you have the most current payroll information for reports and budgeting. All payroll data like paycheck amounts, money paid for taxes, and funds withheld for insurance premiums are transferred to the accounting software so they debit and credit the correct general ledger accounts each pay period.

QuickBooks Online is a great accounting software for small businesses, and although it has its own built-in payroll software you can sign up for, it also integrates with outside payroll software. Discover more of our top picks for the Best Small Business Accounting Software.

4. Expense Reporting Software

If you reimburse your employees for expenses like mileage, per diem, supplies, or entertaining clients, then this software can feed their expense reports into the payroll system. Employees can enter their reimbursement requests along with uploading supporting documentation for you to approve so your payroll system adds it to their paychecks. Some accounting programs may have this feature.

Zoho Expense is an affordable expense reporting app you can integrate with payroll software. For other expense reporting software on our list, check out our buyers’ guide on the best Business Expense Tracker Apps.

5. Human Resource Software

Some payroll software systems already have limited HR functions, like onboarding. Others are part of a larger fully-integrated solution. By integrating payroll and HR software, you can automate tasks from benefits calculations to changes in employee status that affect pay or deductions. It can help with compliance too.

Zoho People is a free HR software you can use for onboarding, leave management, and time and attendance if you have less than five employees. For more options, read our buyers’ guide on the Best HR Software and Apps.

6. Point-of-Sale (POS)

Retailers, restaurants, and service businesses use POS software to track sales and inventory, but many also integrate with payroll software for scheduling, time tracking, tips, and commissions. POS systems with a time and attendance feature make it easy to transfer hours to payroll software; with the click of a button (or a few), work hours are imported, and paychecks are calculated.

Square POS is a free point-of-sale system that’s easy to set up and seamlessly integrates with other Square products. To learn about POS software that integrates with more payroll providers, check out the Best POS Software for 2020.

Reasons to Integrate Other Software With Your Payroll System

• Flexibility: With integrations (as opposed to an all-in-one system), you can select the software that suits your needs and budget. You may even find freeware or free plans that do what you want and that work with your payroll software.
• Saves time: With integrated software, your team is freed from making manual inputs or preparing spreadsheets for bulk upload. This can save valuable hours each pay run.
• Saves money: Sometimes, a cheaper third-party app is more cost-effective than a more advanced payroll plan.
• Prevents errors: With the information moving seamlessly between programs, there’s no chance of a mistyped data entry. However, if anything is put in wrong, that error travels to all the integrated programs, so you’ll want to correct it and check all the programs.
• Relieves stress: Employees don’t need to worry that they aren’t being paid correctly, while payroll and HR teams are freed from the complexities of doing payroll so they can concentrate on issues that need a human touch.

Tips for Seamless Integration

💡 Know your software specs and company requirements: This lets you rule out systems that won’t work for you or your existing payroll software.

💡 Check with your provider first: Many payroll software companies already have integration agreements with other software services. These integrations will be easiest and are time-tested.

💡 Try before you commit: Take advantage of free trials to ensure the software works well with your payroll program and meets your needs before you commit to a paid plan.

💡 Clean your data: This is a great time to fix spelling errors, data that violates business rules, dirty data caused by entity constraint issues (ex: dates), bugs, or patching. Also, check formatting between programs, especially for dates, time, names, and other common information that is displayed in more than one way.

💡 Keep it user-friendly: If adding a software causes more work than manually putting in the information or using spreadsheets, reconsider.

💡 Educate your workforce: Explain why you are making changes and train them in how the new system works.

💡 Customize: Choose software with customizations that let your HR and payroll teams decide what options work for their office, department, or individual employees. For example, salaried workers may need different function integrations than contractors.

💡 Test: Before going live, do test runs with your most common scenarios.

Alternatives to Using Payroll Software Integrations

Although payroll software integration is a good way to mix and match different systems for efficiency, it’s not the only way to get all of the tools your business needs. Some alternative options can be more costly, but they usually result in less work for you, on the front- and back-end.

Payroll Systems With Extra Features

Many payroll software providers offer plans that have additional functions, from time-tracking to HR. Some do it as extra plans, while others offer modules for an additional subscription. When considering these, weigh the price and functionality of a higher plan against purchasing a separate software and integrating it. Also, keep in mind that some payroll programs charge for integrations.

All-In-One Software

An all-in-one software makes it easy to have all your information in a single program. When considering this option, remember:

• While these cost more than a stand-alone payroll program, you may find them cheaper than purchasing several systems and making them work together.
• You’ll have to fully move all your information to the new software; the implementation process is much more involved than when adding an app.
• Even “fully integrated” solutions don’t always interact well. For example, a job position change may not update across the board automatically. Read user reviews with an eye for what functions are problematic.
• All-in-one solutions may have too many features for your needs, which could make the software bloated or more difficult to navigate. Get a demo to see for yourself.

Use an API

If you are sold on an app and it does not integrate with your software, you may be able to use an Application Program Interface (API). This requires some programming experience, but may also let you customize the integration. Also, check with your payroll software provider; they may be willing to create the integration for you.

Outsource

You may decide to outsource certain functions, such as HR or accounting. In this case, the service you hire may have requirements for how you provide your payroll information or may be able to share information between your payroll program and its own programs.

Bottom Line

If you have a favorite payroll software but it doesn’t meet all your needs, or if you are growing beyond the capabilities of your current system, you may not have to change it. Payroll integrations cover everything from time tracking to HR support. With integrations, you can select the app that suits your needs and budget best. However, when integrating payroll software with other applications, be sure the data is clean, the connections work, and that a test run succeeds before launching.