Managing human resources (HR) and payroll activities is more than just checking boxes. It involves providing a seamless experience for employees while keeping compliance and efficiency as your topmost priority.  

This is when HR and workforce management software platforms come into play. Paylocity is one such platform that is designed to ease workforce administration and provides an all-in-one solution for businesses wishing to centralize their HR processes without getting overwhelmed.  

In this article, we will learn what Paylocity does, how it supports important HR operations, and why it has become a go-to solution for thousands of organizations across the United States. 

What Is Paylocity HR Software?

Founded in 1997, Paylocity has grown into a leading, cloud-based HR and payroll software provider. The platform specializes in supporting small to mid-sized businesses (SMBs) with scalable solutions for everything from onboarding and benefits administration to payroll processing and tax compliance. 

The software combines payroll and HR features within a unified system, allowing HR professionals to manage employee data, compliance, and compensation from a single location. With a strong focus on usability, employee engagement, and mobile accessibility, Paylocity HR and payroll software aims to be more than just a transactional tool, establishing itself as a strategic partner in creating more collaborative and efficient workplaces. 

What Does Paylocity Do? Core Capabilities Explained

So, what does Paylocity actually do? The simple answer is that it integrates human resources and payroll management into a single cloud-based platform. But its capabilities go well beyond simple payroll. Let’s have a closer look at the main areas in which the platform supports HR and payroll processes. 

Payroll Processing And Tax Compliance  

Paylocity's payroll module handles everything from gross-to-net calculations to direct deposits and year-end tax filings. It also handles: 

  • Direct deposit, garnishment management, and deductions
  • Custom payroll reports and audit trails
  • Federal, state, and local tax compliance
  • W-2s, 1099s, and ACA reporting
  • Support for multi-state and international payroll with tax filing assistance

The software provides employees with a mobile-friendly portal to view pay stubs, update personal information, and access previous tax documents, reducing HR inquiries and administrative friction. 

Core HR Management 

The human resources module serves as a single point of record for all employee information. HR teams can manage: 

  • Onboarding workflows and e-signatures
  • Employee self-service portal (for employee records and digital document storage)
  • Compliance tracking (e.g., certifications, licenses, policies)
  • Organizational charts and job history

Time And Labor Tracking  

Accurate timekeeping is necessary for payroll, labor cost control, and compliance. Keeping this in mind, Paylocity offers: 

  • Employee scheduling tools
  • Clock-in/out via web or mobile devices
  • Overtime tracking and rule-based pay codes
  • Time-off requests and approvals

Talent Acquisition And Performance Management 

Paylocity offers built-in capabilities that facilitate each stage of the employee lifecycle: 

  • Job postings and applicant tracking (ATS)
  • Interview scheduling and communication
  • Onboarding checklists and automated forms
  • Goal setting and performance reviews
  • Ongoing feedback and development tracking

Employee Benefits Administration  

Managing benefits can be one of the most demanding HR activities. Paylocity simplifies the process by: 

  • Supporting open enrollment and life event changes
  • Offering a self-service portal for employees to compare and select plans
  • Automating eligibility tracking and carrier connections
  • Generating benefits reports for audits or broker communication

One of Paylocity's distinctive features is its emphasis on employee engagement. It offers: 

  • Peer-to-peer recognition features
  • Pulse surveys and feedback loops
  • A company newsfeed for announcements and shout-outs
  • Messaging and collaboration spaces

Integrations And Platform Flexibility 

Paylocity features pre-built integrations with platforms like Asana, QuickBooks, NetSuite OpenAir, 7shifts, Acumatica Cloud ERP, and several other applications. It offers open APIs for custom integration. The software also enables a flexible, connected environment for synchronizing data with accounting tools and importing time from external systems. 

Who Should Use Paylocity?

Paylocity is mainly designed for small and medium-sized enterprises seeking an all-in-one HR and payroll solution. It supports a wide range of business industries, including healthcare, manufacturing, education, nonprofits, and more.  

Companies that can benefit the most from Paylocity generally: 

  • Have 50–1,000 employees
  • Need to streamline disconnected HR systems
  • Value employee self-service and mobile access
  • Want to combine payroll, HR, and engagement tools in one place

For growing businesses or HR professionals wanting to reduce administrative overhead while maintaining compliance, Paylocity can be an ideal solution. 

Summing Up

So, what does Paylocity do? It streamlines the way businesses handle payroll, human resources, benefits, time tracking, and employee engagement. It's more than just a payroll provider; it's a whole workforce management solution that assists organizations in lowering administrative costs, staying compliant, and creating better workplaces. 

Whether you want to scale the HR department or gain better visibility into workforce data, Paylocity provides the tools and assistance you need.