Last Updated: February 2026
When you're running a small business with fewer than 10 employees, you don't need enterprise-grade complexity—you need simplicity, affordability, and tools that work out of the box. This guide covers the best HR software solutions designed specifically for micro-businesses where every dollar counts and the owner is likely wearing multiple hats.
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Compare HR Software →At this stage, your HR challenges are unique:
Starting Price: $40/month + $6/employee
Best For: Businesses that want payroll, benefits, and HR in one simple package
Gusto has become the gold standard for small businesses because it makes payroll genuinely easy. Their interface is clean, automated tax filings remove the biggest source of stress, and employees get a self-service portal for pay stubs and tax forms.
Bottom Line: If you want a single platform that handles payroll, benefits, and basic HR without complexity, Gusto is worth the investment. It's the "set it and forget it" solution for busy owners.
Starting Price: Free (limited features), paid plans from $20/month/location
Best For: Retail, restaurants, and service businesses with hourly employees
Homebase started as a scheduling tool and has evolved into a full HR suite for businesses with shift-based workers. The free tier is surprisingly robust, making it ideal for bootstrapped micro-businesses.
Bottom Line: If you run a coffee shop, retail store, or small restaurant, Homebase is tailor-made for you. The free plan handles scheduling and time tracking, and you can add payroll later if needed.
Starting Price: Free accounting; payroll $20-$40/month depending on state
Best For: Solopreneurs with 1-3 employees who need bare-bones payroll
Wave is the underdog in the HR software space, but for micro-businesses with minimal needs, it's a hidden gem. Their accounting software is completely free, and payroll is pay-per-run ($20 for state tax filing, $40 for full-service).
Bottom Line: If you're a freelancer who just hired your first employee or a micro-business that only needs payroll without the HR bells and whistles, Wave is unbeatable on price.
Starting Price: $40/month + $6/employee
Best For: Businesses that want Gusto-level features without the complexity
OnPay is the "quiet achiever" in HR software—less flashy than Gusto but equally powerful. Their pricing is transparent, setup is straightforward, and they handle multi-state payroll without breaking a sweat.
Bottom Line: OnPay is the choice for owners who want full-featured payroll and HR without paying for a premium brand. It's reliable, affordable, and grows with you.
Starting Price: $8/employee/month (Essentials plan)
Best For: Small businesses offering health insurance and benefits
Zenefits reinvented itself after a rocky past and is now a solid choice for small businesses that want to offer competitive benefits. Their benefits administration is best-in-class at this price point.
Bottom Line: If you're a 5-10 person business that wants to offer health insurance and benefits to compete for talent, Zenefits gives you enterprise-level benefits admin at a small business price.
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View Full Comparison →| Platform | Starting Price | Best Feature | Payroll | Benefits Admin | Free Trial |
|---|---|---|---|---|---|
| Gusto | $40/mo + $6/employee | All-in-one simplicity | âś… Included | âś… (Premium tier) | 30 days |
| Homebase | Free to $20/location | Scheduling & time tracking | ❌ Add-on | ❌ | Forever free plan |
| Wave | $20-40/month | Lowest cost payroll | ✅ Included | ❌ | No trial needed |
| OnPay | $40/mo + $6/employee | Unlimited payroll runs | âś… Included | âś… Included | 30 days |
| Zenefits | $8/employee/month | Benefits administration | ❌ Add-on | ✅ Included | 14 days |
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Take the Quiz →It depends on your tolerance for risk and time. If you're doing payroll manually, you're exposed to tax penalties, labor law violations, and time waste. Even basic software like Wave ($20-40/month) eliminates most of that risk. Think of it as insurance against IRS audits and wage disputes.
Payroll software only handles wage calculations, tax withholdings, and payments. HR software includes payroll plus employee onboarding, benefits administration, time tracking, compliance tools, and document management. For businesses under 10 employees, an all-in-one platform like Gusto or OnPay makes more sense than separate systems.
Yes, but timing matters. The cleanest transitions happen at the start of a quarter (to align with tax filings) or at year-end. If you switch mid-year, make sure your new provider can import year-to-date payroll data so your W-2s are accurate. Most platforms offer migration assistance.
This complicates things significantly. You'll need software that handles multi-state payroll and tax compliance. Gusto, OnPay, and Zenefits all support this. Wave is more limited. Avoid DIY solutions if you have multi-state employees—the compliance risk is too high.
Ideally, yes. Platforms like Gusto and OnPay handle both W-2 employees and 1099 contractors in one system, which simplifies year-end tax reporting. If you only have contractors, Wave or even PayPal/Venmo might suffice, but once you have even one W-2 employee, consolidate everything.
For businesses under 10 employees, expect to spend $50-150/month depending on features. Budget breakdown: $40-60 base fee + $6-10 per employee. If you're offering benefits, add another $50-100/month for administration. Free tiers (Homebase) exist but are limited. Calculate your time savings—if software saves you 2+ hours per pay period, it pays for itself.
Most platforms scale well from 5 to 50 employees. Gusto, OnPay, and Zenefits all have higher-tier plans for growing businesses. The key is choosing a platform with a clear upgrade path. Avoid ultra-basic tools (like Square Payroll) that force you to migrate when you hit 15-20 employees.
Not immediately, but if you plan to offer benefits in the next 1-2 years, choose a platform that supports it (Gusto, OnPay, Zenefits). Adding benefits mid-contract is easier than switching platforms entirely. Even "simple" benefits like commuter passes or HSAs benefit from proper administration.
Best for most small businesses under 10 employees: Gusto. It balances simplicity, features, and scalability better than any competitor. Yes, it costs more than Wave, but the time savings and peace of mind are worth it.
Best for ultra-tight budgets: Wave. If every dollar counts and you only need bare-bones payroll, Wave gets the job done for $20-40/month with no per-employee fees.
Best for shift-based businesses: Homebase. The free tier handles scheduling and time tracking beautifully, and you can add payroll later as you grow.
Best for benefits-focused businesses: Zenefits. If you're offering health insurance to compete for talent, their benefits administration is unmatched at this price point.
Best for no-nonsense owners: OnPay. All features included, transparent pricing, and it just works without fuss.
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See Full Comparison →About This Guide: We research and compare HR software to help small businesses make informed decisions. Our recommendations are based on features, pricing, user reviews, and suitability for specific business sizes. We may earn commissions from some providers, but this doesn't influence our editorial independence.