What is an HRIS (Human Resource Information System)?

The future of human resources (HR) is digital, and a Human Resource Information System (HRIS) is the way to go if you want to manage your employees’ information online. This simple system leads the pack in workforce management by centralizing HR functions and automating routine tasks so you can focus on growing your team and business.

Read on to learn more about what an HRIS is, its key features and benefits, and why this system is a must-have for modern HR teams. 

What is an HRIS?  

An HRIS is an HR software solution that stores and manages employee data for businesses, serving as a central database of employee records. Companies typically use an HRIS for day-to-day human resources (HR) functions, such as payroll, employee onboarding, and employee benefits management. Some human resource information systems are stored in the cloud, a collection of servers that host software and are accessed over the internet.  

What does an HRIS do?  

An HRIS helps HR and People Operations teams maintain accurate employee records and track HR performance metrics.

An HRIS reduces the possibility of manual errors and discrepancies that might occur if valuable employee information is recorded via less secure methods (e.g., on paper or online spreadsheets). An HRIS also ensures that sensitive data is stored safely and in compliance with data and privacy regulations. 

An HRIS lets People Operations teams automate standard processes and workflows in workforce management. These processes and workflows include local and global recruitment, payroll, tracking employee absences and paid time off (PTO), performance management, and more.

An HRIS also provides reporting and analytics, helping companies make data-informed decisions regarding hiring and promotions. 

HRIS vs. HRMS vs. HCM  

HRIS software helps teams manage essential HR functions. It stores and organizes employee data and automates basic workflows so HR teams can manage employee records and track time and attendance efficiently, among other tasks. 

A Human Resource Management System (HRMS) has the same functionalities as an HRIS, plus additional tools. This comprehensive HR information system streamlines the employee life cycle, from onboarding to absence and performance management. It facilitates more core HR services related to employee experience than an HRIS, including training and development.  

A Human Capital Management (HCM) system is HR management software with all the features of an HRIS and HRMS, plus strategic integrations. This system helps companies optimize their workforces through strategic planning and learning and development tools. HCM software also offers additional tools like compensation management and succession planning.  

Here’s a look at the different offerings of these HR systems:

HRIS 

• Centralizes employee records and information
• Automates everyday HR tasks like benefits administration and payroll processing 

HRMS 

• Manages job postings, applications, and candidate tracking
• Simplifies new hire integration
• Tracks employee performance and development
• Enhances team communication and engagement 

HCM 

• Provides resources and tools for employee training and growth
• Manages salaries, bonuses, and benefits
• Identifies and develops leaders
• Utilizes data for strategic workforce planning and decision-making
• Offers insights to improve overall HR strategy 

HRIS features

HRIS software improves HR efficiency through the following functions:  

Recruitment

An HRIS automates basic recruitment tasks like job postings. It also screens potential employees and performs background checks.

Payroll 

An HRIS automatically calculates wages, taxes, and deductions to pay your employees accurately and on time. Automating payroll saves time and minimizes human error, improving overall payroll efficiency. HRIS software keeps payroll data updated and accurate through built-in attendance and time-tracking systems.

Benefits administration 

This software simplifies employee benefits management. It centralizes your staff’s health insurance, retirement plans, and other perks, automating enrollment and tracking employee eligibility. With an HRIS, team members can view and manage their benefits through an employee self-service portal, helping them make informed decisions about their benefits plans.

Employee data management 

An HRIS system collects, organizes, and stores employee data. This core feature reduces paperwork and enhances accessibility for HR staff. Using HRIS software to maintain current and accurate records helps HR professionals retrieve and manage employee information, improving operational efficiency and productivity. 

Reports and analytics 

HRIS software generates comprehensive HR reports on employee turnover, attendance, performance, and other metrics. These reports provide valuable information that helps HR teams analyze employee experience and make informed decisions for the organization. These advanced analytics also help companies examine their data to boost strategic planning.  

5 benefits of an HRIS 

An HRIS provides numerous benefits for businesses of every shape and size. Here are a few examples:

1. Recordkeeping: An HRIS makes employee data easy to access and update. Centralizing this information reduces paperwork and ensures personnel information is accurate. 
2. Data-driven decisions: Most HRIS solutions offer analytics and reporting tools that help HR teams make informed choices. Real-time data aids in employee management, strategic planning, and achieving business goals.  
3. Efficiency: When you automate tasks like payroll processing, attendance tracking, and benefits administration through an HRIS, your HR team can focus on high-level work. 
4. Compliance: An HRIS automatically updates records and processes to align your business’s operating procedures with regulations. This keeps your company compliant with local and international labor laws, minimizing the risk of legal issues like fines. 
5. Improved HR services: With an HRIS, employees enjoy access to a self-service portal to easily manage their information, request leave, and access benefits online.

4 steps to choose the best HRIS

These essential steps will help you find the best HRIS for your business: 

1. Assess your needs: What are your current HR challenges? Identify these pain points and what you need to rectify them, whether that’s better data management or enhanced reporting. Outlining your needs will help you choose a system that addresses them.
2. Evaluate scalability: Where do you see your business in five, 10, and 15 years? Scalable HRIS software can accommodate more employees and expand functionalities.
3. Check integration capabilities: Select an HRIS that integrates with your existing business tools, such as payroll software, time-tracking systems, and benefits platforms.
4. Consider the user experience: Opt for a user-friendly HRIS with comprehensive training resources. This will help your employees adopt the new system and get the most out of its features.

Simplify global talent management with Oyster 

Oyster is a global hiring platform for managing recruitment, payroll, benefits, and employee data worldwide. Through our services, HR staff can effortlessly hire, onboard, pay, and support international team members in compliance with local labor laws. Oyster will help you streamline your HR processes so you can focus on nurturing your workforce and growing your business.  

Ready to find out how Oyster can transform your HR operations? Book a demo today.