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HR Software Pricing Comparisons: A Complete Guide

Software Development September 12, 2023

The HR software pricing varies depending on the features and functionality offered, the number of users, and the size of the business. In general, HR software is priced on a per-user basis, with the price per user decreasing as the number of users increases.

How well the HR management of a company is done is directly proportional to how successful the organization is going to be. No wonder tech giants are looking for different ways to develop HR software that can boost employee management and keep their workforce happy.

According to Forbes, companies with strong employee experience have a 31% lower turnover rate than companies with weak employee experience.

HR management, while vital to an organization’s success, comes with its fair share of challenges and struggles. These hurdles can range from evolving workforce dynamics to ever-changing legal requirements.

That’s why companies are looking to develop custom HR software that can take their employee management to its full potential. If you are someone who is looking to boost their HR management capabilities, then this blog is for you.

We will discuss the key features and costs of HR software, factors affecting its pricing, and its types in detail.

Keep reading.

What is HR Software?

Human resources (HR) software is a suite of applications that helps businesses manage their employees. It can automate tasks such as payroll, benefits administration, and recruiting, and it can also provide insights into employee data to help businesses make better decisions.

By automating these tasks, HR software enhances operational efficiency and provides valuable insights into workforce information.

This technology serves as a valuable resource for businesses seeking to streamline their HR operations, improve overall productivity, and gain a deeper understanding of their workforce dynamics.

Key Functions Of An Effective HR Software

HR software should encompass a range of key functions to comprehensively manage human resources within an organization. Some essential functions to include are:

Employee Information Management

The HR software should allow for centralized storage and easy retrieval of employee data, including personal details, job history, performance reviews, and more.

Organizations that have a centralized employee information management system are more likely to comply with regulations and less likely to experience data breaches.

Applicant Tracking System (ATS)

A study by the Aberdeen Group found that organizations that use an ATS can reduce their time to hire by up to 27%.

An ATS in HR software helps in managing the recruitment process by tracking job applications, resumes, and communication with candidates. It streamlines the hiring process and facilitates collaboration among hiring dedicated team.

Payroll Management

Payroll Management is a crucial function within HR software that plays a pivotal role in ensuring employees are accurately compensated for their work.

This feature assists in calculating and processing employee salaries, deductions, bonuses, and taxes accurately. It ensures timely and error-free payroll distribution.

Performance Management

A performance management module aids in setting goals, conducting performance appraisals, providing feedback, and tracking employee development over time.

Integrating this function into your HR software can be a valuable tool for organizations that are looking to improve employee performance, engagement, and retention. This module can help organizations get the most out of their workforce.

Remote Work Management

With the rise of remote work, HR software should support remote work arrangements by enabling efficient communication, collaboration, and performance tracking for remote employees.

In short, developing good HR software with all the key functions can work like a Swiss army knife for managing a company’s human resources. It helps keep employee information organized, speeds up hiring, ensures accurate paychecks, and encourages employees to do their best.

Plus, it adapts to the trend of remote work. What else do we need in this remote era?

Now, let’s find out how many main types of HR software there are and which one will work best for you.

Types Of Human Resource Software

There are many different types of HR software available, each with its own set of features and benefits. Here are some of the most common types of HR software:

HRIS (Human Resource Information Systems)

HRIS works as your digital hub for all things related to your employees.

This type of HR software acts like a sophisticated digital filing system that securely stores crucial information about your employees, such as their personal details, work history, and performance evaluations.

Additionally, HRIS can take on various tasks, from efficiently managing payroll and benefits to streamlining the hiring process.

HCM (Human Capital Management)

HCM is like an upgraded version of HRIS. It not only stores employee data but also offers a comprehensive suite of tools to manage the entire employee lifecycle, from recruitment to retirement.

HCM simplifies HR processes, enhances efficiency, and aids in making informed decisions regarding talent management.

HRMS (Human Resource Management System)

HRMS is a broad term encompassing systems used for HR tasks. HCM, on the other hand, is a more specific type of HRMS that integrates different HR tools into one cohesive platform.

Talent Management Systems

These types of HR software work as your strategic partners in identifying, nurturing, and retaining top talent within your organization.

Talent management systems cover various aspects, including talent acquisition (finding the right people), performance management (assessing and enhancing employee performance), succession planning (preparing for future leadership needs), and learning and development (helping employees grow and acquire new skills).

These systems can also measure employee engagement and satisfaction to create a thriving work environment.

When choosing the type of HR software, consider the following factors:

  • Company Size and Complexity: Your organization’s size and complexity will influence the type of software that best suits your needs.
  • Specific Feature Requirements: Identify the particular features and capabilities you require to effectively manage your HR processes.
  • Budget: Determine how much you can allocate for HR software, considering both initial costs and ongoing expenses that can determine the price of HR software.
  • IT Infrastructure: Evaluate your existing technology setup and ensure compatibility with the chosen HR software.
  • Technical Expertise: Consider the technical proficiency of your team to ensure smooth implementation and ongoing management.

HR Software Development: Important Features

HR Software features

Centralized Database

A fundamental requirement for any HR software is a secure and scalable centralized database. It serves as the heart of your HR system, housing all employee data in one accessible location, ensuring efficient management, and accommodating your organization’s growth.

Attendance and Leave Management

This feature streamlines the tracking of employee attendance, leave requests, and various absence types, including sick days and vacations. It also empowers you to generate insightful reports on attendance and leave trends.

Payroll Automation

Simplify the complex process of payroll calculation, paycheck generation, and benefit and deduction tracking. This feature ensures accurate and timely compensation for your employees.

Recruitment Management

From posting job openings to applicant screening and hiring decisions, this feature facilitates the entire recruitment cycle. Recruitment management software also allows you to monitor the progress of your recruitment campaigns.

Onboarding Support

Welcoming new employees is made more efficient with an onboarding feature. It equips new hires with the necessary information and resources to succeed in their roles. This includes task checklists and a channel for them to seek guidance.

Performance Tracking

Efficiently monitor and manage employee performance with this feature. It enables goal setting, performance assessments, and feedback, while also providing valuable performance trend reports.

Talent Management

Identify and nurture high-potential employees through talent management tools. This includes maintaining a talent pool, succession planning capabilities, and resources for training and development.

Training and Development Oversight

Keep track of employee training and development initiatives, ensuring that skills and competencies align with organizational goals. Generate comprehensive reports on employee capabilities.

These HR software features serve as the foundation for your HR management system. The specific functionalities you choose to implement will depend on the unique requirements and size of your organization.

Factors That Impact The Cost Of HR Software Development

The HR software pricing can vary widely based on numerous factors. Here are the key factors that can help you determine how much an HR software costs.

Complexity and Size

The size and complexity of your HR software project affect how much it will cost. When your project is extensive and involves intricate features, it naturally demands a greater amount of time and resources for its development.

These advanced features often entail more intricate coding, comprehensive testing, and specialized expertise, all of which contribute to the higher cost of HR software development.

Type of HR Software

The specific kind of HR software you’re creating influences costs. HR software solutions come in various forms, ranging from basic HR systems to comprehensive HR management systems (HRMS) and specialized software designed for specific tasks, such as payroll management.

Each category of HR software has its own set of features, complexities, and functionalities, and these differences significantly impact the overall HR software pricing.

Features and Functions

The functions you want in your HR software directly impact the cost of development. Basic software with essential features is more economical than comprehensive solutions with advanced features.

Basic HR software pricing which typically covers essential features such as employee data management, attendance tracking, etc. is more economical than comprehensive HR software solutions with advanced features such as recruitment and applicant tracking, performance management, benefits administration, reporting, and analytics.

However, the basic software may lack advanced functionalities that can streamline complex HR processes or provide in-depth analytics.

Customization Needs

Customization in HR software development refers to the process of tailoring the software to align with the specific requirements, workflows, and branding of your organization.

However, due to extra efforts and tailor requirements, the development cost of HR software increases. So, a balance between customization and cost-effectiveness will work best.

Integration with Other Systems

The complexity of integrating your HR software with existing systems can influence development costs due to the technical challenges, testing, security considerations, and ongoing maintenance required.

These other systems can include accounting software, customer relationship management (CRM) software, time and attendance tracking systems, or any other tools that play a role in the HR processes or the broader operations of the company

User-Friendly Design

A user-friendly interface is important because it directly influences how efficiently employees and administrators can interact with the software.

While investing in a well-designed interface may increase upfront HR software pricing, the long-term benefits in terms of user satisfaction, productivity, and reduced support and training costs often outweigh the initial investment.

Data Security and Compliance

Ensuring data security and compliance with relevant regulations such as GDPR and HIPAA is a critical aspect of HR software development

Since HR software deals with sensitive employee data, meeting data protection rules and industry standards is essential which may eventually involve the extra cost of HR software.

Testing and Quality Assurance

Thorough software testing is essential for delivering reliable and high-quality HR software.

This can impact the overall development cost of HR software due to the time, resources, and specialized expertise required.

However, investing in testing is a prudent approach as it helps identify and address issues early in the development process, ultimately reducing the risk of costly post-launch problems and ensuring user satisfaction.

Support and Maintenance

Ongoing support, updates, and maintenance are necessary for HR software. Budgeting for these post-development needs is vital for long-term reliability.

It’s important to carefully consider these factors while planning your HR software project to manage costs effectively and achieve your goals.

HR Software Pricing: How Much Will It Cost to Develop HR Software?

The HR software pricing can vary widely depending on several factors. These factors include the complexity of the software, the features and functionality you require, customization needs, integration with other systems, security and compliance considerations, and the location and expertise of the development team.

Basic HR Software pricing: For a straightforward HR software solution handling essentials like employee data management, time tracking, and leave management, the development cost may range from $5000 to $25,000.

  • Mid-Range HR software pricing: To build a more comprehensive HR Management System (HRMS) that includes features such as performance management, recruitment tools, and basic analytics, you might anticipate costs ranging from $25,000 to $50,000.
  • Large-Scale Enterprise Solution: Enterprises seeking a top-tier HR software solution with extensive customization, seamless integration capabilities across systems, and the highest standards of security and compliance can expect costs that start at $50,000 or more.
  • Maintenance and Support: It’s crucial to allocate a portion of your budget for ongoing maintenance and support of your HR software, typically amounting to 20-30% of the initial development cost annually.

What is the Typical Cost of Developing an HR Application?

The cost of developing an HR application can be influenced by a multitude of factors, making it challenging to provide an exact figure without specific project details.

Several key determinants impact the overall cost, including the complexity of the application, the number of functions it must encompass, the chosen development approach, and the location and experience level of the development team.

Here’s a rough estimate of the cost of developing an HR application for your understanding:-

  • Basic HR Application cost: For a fundamental HR application equipped with essential features like employee data management, attendance tracking, leave management, and basic reporting capabilities, the development cost typically falls within the range of $25,000 to $50,000.
  • Comprehensive HR Application: If your project requires a more comprehensive HR application, covering advanced features such as performance management, recruitment, training modules, analytics, and seamless integration with other systems, the cost can extend from $50,000 to $150,000 or even higher, depending on the complexity and scope of your specific requirements.

How The Cost Of Developing HR Application Varies According To Different Factors:


The HR application development cost can vary significantly based on the location of the development team.

  • Cost of developing HR application in the USA: The United States is known for relatively high labor costs for mobile application development.
    Hourly rates for skilled developers in the USA often range from $100 to $250 or more.
  • Cost of developing HR application in Europe: Western European countries have relatively high labor costs, leading to higher development expenses. Skilled developers are readily available, but hourly rates typically range from $80 to $180.
  • Cost of developing HR application in Australia: Australia is known for moderate to high labor costs for software development. Hourly rates for skilled developers in Australia typically range from $60 to $150 or more.
  • Cost of developing HR application in India: India is popular for cost-effective development services with hourly rates ranging from $20 to $40.
    They have a pool of dedicated developers in the latest technologies. You can expect a high level of expertise as per your requirements.

Technology Stack

The choice of technology stack can affect costs. Proprietary or specialized software may have licensing fees, while open-source solutions can be more cost-effective but might require more development time.

Developer Experience

Junior Developers: Junior developers are new to the field and have limited experience. They may need more guidance and oversight but are well-suited for less complex tasks and projects with budget constraints.

Mid-Level Developers: Mid-level developers have accumulated more knowledge and can handle a broader range of tasks with less supervision. They can take on more responsibility in the development process.

Senior Developers: Senior developers are seasoned professionals with extensive expertise in their chosen technologies. They can lead complex projects, provide guidance to junior team members, and make critical decisions. They are often sought after for projects with demanding requirements.

Development Approach

The choice of development approach, such as building from scratch, using pre-built templates, or utilizing low-code/no-code platforms, can impact the costs of HR application development.

Custom software development typically involves higher initial costs but may provide greater flexibility and scalability.

Security and Compliance

Ensuring the security and compliance of HR data is critical. Meeting data protection regulations (e.g., GDPR, HIPAA) can require additional security measures and compliance checks, increasing development costs.

It’s essential to conduct a thorough analysis of your project’s specific requirements and constraints to estimate the cost accurately. Many organizations choose to work with experienced mobile application development partners who can provide detailed project estimates based on these factors. Additionally, creating a well-defined project scope and clear objectives can help manage costs throughout the development process.

Develop HR Software with Zealous

At Zealous, we are passionate about transforming your HR management processes into seamless, efficient, and highly productive operations. Our dedicated team of experts specializes in crafting customized HR software solutions tailored to your organization’s unique needs.

With years of experience in HR software development technology, we understand the critical importance of features like centralized databases, attendance and leave management, payroll automation, and recruitment support. We go beyond the ordinary by offering comprehensive onboarding, performance tracking, talent management, and training and development tools.

When you choose Zealous for your HR software development needs, you’re not just getting a service; you’re getting a partner committed to enhancing your HR capabilities, empowering your workforce, and driving your organization’s success. Join hands with us, and let’s elevate your HR management to new heights.


HR software is a game-changer for modern businesses. It streamlines HR processes, empowers employees, and ensures compliance. However, the HR software pricing varies based on factors like complexity and customization.

Remember that investing in HR software is about more than just technology; it is about optimizing your most valuable asset—your people. Finding the right balance of cost and functionality is the key to your company’s success.

Build Custom HR Software without disrupting your budget.


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