Best HR Compliance Software

Jeffrey Lin
JL
Researched and written by Jeffrey Lin

HR compliance software helps companies, managers, and HR professionals or departments keep up to date with all HR business regulations and compliance laws. These solutions allow businesses to understand complex and ever-changing state and federal compliance legislation and rules. HR compliance solutions also help businesses communicate and enforce company and legislative policies to their employees. Furthermore, these tools often automate classified document management workflows and reporting.

Traditionally, compliance solutions have focused solely on financial compliance for payroll, for example, but in recent years they have expanded to provide more holistic solutions. Today, HR compliance software typically covers payroll, benefits, risk and safety, recruitment, and employee relations. Most vendors do not provide solutions that span across every area but rather specialize in specific compliance laws such as ACA, benefits, or small business. HR compliance software is often provided in tandem with other HR software, including onboarding software, time and attendance software, or benefits administration software, to name a few. HR compliance software can also be sold as a standalone solution. Furthermore, some HR compliance solutions provide core HR software or payroll software integrations to automate payroll reports and efficiently maintain compliance.

To qualify for inclusion in the HR Compliance category, a product must:

Monitor compliance regulations
Provide customizable HR documents for different types of policies
Classify, file, and manage pertinent documents
Provide administrators with the tools to communicate compliance risks to employees
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Best HR Compliance Software At A Glance

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133 Listings in HR Compliance Available
(11,447)4.8 out of 5
4th Easiest To Use in HR Compliance software
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12th Easiest To Use in HR Compliance software
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Learn More About HR Compliance Software

What is HR Compliance Software?

HR departments face significant compliance and enforcement risks as they manage all internal and external policies. HR professionals and managers use HR compliance software to keep up to date with ever-changing federal, state, and local government regulations, employment laws, company policies, and so on. Through the use of this technology, HR professionals are able to maintain and manage regulatory compliance, determine how it impacts company performance, and improve their businesses' compliance programs.

As new legislation like the EU’s General Data Protection Regulation (GDPR) continue to widen in scope, organizations must stay on top of these ever-increasing and expanding laws to maintain compliance. Regulatory technology (regtech) has typically been considered to be a subcategory of financial technology (fintech) because it helps financial institutions meet financial compliance regulations. Regtech has experienced an increase in popularity within the past few years, due in part to the rise of disruptive fintech products as well as the essential role regetch plays in HRtech. Regtech and HRtech will only continue to merge as legislation like GDPR influences how organizations can store, process, and manage employee information.

HR compliance technology can help businesses, managers, and HR professionals make more informed decisions. HR compliance software is often integrated with core HR, human resource information systems (HRIS), or human resource management systems (HRMS), or is offered as an add-on solution. These compliance solutions provide users with a central hub to manage all compliance-related issues, activities, and tasks. HR compliance software maintains updated information about industry-specific laws, making it easier for businesses to maintain industry compliance. HR compliance software streamlines the organization of employee paperwork, wage and benefits compliance, security of sensitive information, and mitigation of any errors that could result in unintentional noncompliance.

Key Benefits of HR Compliance Software

  • Maintain federal, state, and company policy compliance for payroll, benefits, risk and safety, recruitment, employee relations, and so on
  • Create notifications and alerts for relevant legislation and rule updates
  • Track changes and updates to employee documents and files
  • Safely secure all employee documents and data
  • Automate reporting for relevant legislation and rules
  • Create specific roles and permissions with varying levels of access


Why Use HR Compliance Software?

HR compliance software helps organizations, HR departments, and HR personnel maintain compliance, manage complex regulatory changes, and improve HR practices. If companies fail to accurately maintain compliance, errors and issues can result in the following:

Penalties — Penalties are steep for any misstep in compliance, these include errors and omissions, missing forms or existence of forms that should have been deleted, inconsistencies, unlawful employment, and so on. HR compliance software will help HR departments avoid compliance errors and maintain consistency across all documents. For example, compliance technology will alert HR to when forms need to be discarded following an employee termination. Noncompliance penalties could cost employers anywhere from $25 per employee per day for new hire reporting errors to upwards of $1,500,000 per year for 1099 penalties.


Who Uses HR Compliance Software?

Large, small, and midsize companies must comply with ever-changing state and federal legislation and company policies. HR compliance software provides companies, HR departments, and HR personnel with streamlined solutions to carefully manage and maintain all compliance across the organization. These solutions might include HR compliance training, HR audits management, employee handbooks, and more.

Small and midsize organizations, in particular, might have a difficult time keeping up with HR compliance as new legislation is continually introduced. Particularly when the HR team is small (or even just one person), their bandwidth quickly becomes strained. HR compliance software is essential to maintaining compliance across all departments in as streamlined and simplified a way as possible.


Kinds of HR Compliance Software

HR compliance covers a variety of areas to help businesses and HR departments maintain compliance on a company-wide scale. While some vendors do provide comprehensive solutions that tackle all areas of HR compliance, most vendors focus on a specific compliance solution such as benefits or payroll. The following is a list of areas that HR compliance software address:

Benefits compliance — Benefits programs must comply with specific legislation. HR compliance software helps program directors maintain compliance with the latest Affordable Care Act (ACA), flexible spending account (FSA), health savings account (HSA), Employee Retirement Income Security Act of 1974 (ERISA), and Consolidated Omnibus Budget Reconciliation Act (COBRA) regulations. These solutions focus on the following compliance concerns: Health Insurance Portability and Accountability Act (HIPAA), Family and Medical Leave Act (FMLA), Genetic Information Nondiscrimination Act (GINA), Children’s Health Insurance Program Reauthorization Act (CHIPRA), Mental Health Parity and Addiction Equity Act (MHPAEA), and Fair Labor Standards Act (FLSA).

Employee relations — This type of HR compliance software helps organizations manage complex regulatory changes and prepare for Office of Federal Contract Compliance Programs (OFCCP) audits. They also provide oversight into Affirmative Action Programs (AAP) with compliant plans, management, training, and quantitative analysis to support talent decisions and reduce penalties and fines.

Labor and employment — Proper employee eligibility verification is necessary for confirming the identity of a new hire and verifying that they are eligible for employment. HR compliance software helps HR personnel collect, organize, and maintain all employment eligibility documentation.

Payroll — Payroll processes must comply with local, state, and federal legislation. Payroll compliance oversees all aspects of payroll production including the capture and calculation of payroll data. These HR compliance solutions also manage federal and state law specifications, tailoring compliance efforts to the location of organization or employee. They focus on the following compliance concerns: FLSA, Federal Insurance Contributions Act (FICA), Federal Unemployment Tax Act (FUTA), and Sarbanes-Oxley Act (SOX).

Risk and safety — HR departments and professionals use HR compliance software to monitor, manage, and enforce occupational safety across the organization. These solutions focus on the following compliance concerns: Mine Safety and Health Administration (MSHA), and Occupational Safety and Health Administration (OSHA).

Recruitment — Organizations and HR departments must maintain compliance with state and federal regulations when recruiting and hiring new talent. Recruitment compliance can be especially difficult for small and medium-sized businesses to manage with only small HR teams or individual HR staff members. These solutions focus on the following compliance concerns: Consumer Credit Protection Act (CCPA), FLSA, Equal Employment Opportunity/Affirmative Action (EEO/AA), Department of Labor, Office of Federal Contract Compliance Programs (OFCCP).