Paychex provides a wide range of services including payroll processing, PEO services, benefits administration, and HR consulting.
- Wide variety of custom services provide options for companies with many different unique needs.
- Full HR outsourcing solution including payroll and recruitment support, as well as PEO
- No international remote employee options
- No publicly-displayed pricing
Not publicly available
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According to Paychex, the average client who works with a Professional Employer Organization (PEO) saves an average of $1,777 per employee per year, 27% in HR costs, and experiences 20% less employee turnover. Clients of Paychex can also access “Fortune 500-level employee benefits” and a complete HR outsourcing solution.
PEOs partner with client businesses to onboard and administer new employees. The PEO becomes the ‘co-employer‘ for these employees, and is thus responsible and liable for compliance, payroll, and benefits administration. Businesses pay PEOs for the service, generally per employee per month or as a percent of total payroll.
The savings and benefits touted by Paychex and other PEO services are possible due to a PEO’s ability to consolidate services and achieve economies of scale. A large PEO can often manage HR tasks, process payroll, administer benefits, and file taxes much more efficiently than an internal team. This leads to a reduction in human error and correspondingly lower turnover. For smaller companies, it is also often much less costly than hiring HR staff. Being large employers, PEOs can also access competitively priced and comprehensive benefits packages that are generally not offered to smaller companies.
Paychex is one of the top payroll processing companies in the US for small businesses, currently serving over 730,000 clients. It has been an honoree as one of the World’s Most Ethical Companies by ethisphere.com 14 times, was rated one of the World’s Most Admired Companies by Fortune in 2021, Best Provider of HR Outsourcing for Small Businesses by Inc., and was a Silver Stevie Winner in 2021 for Sales and Customer Service.
From its core capability of payroll processing, Paychex has branched out to offer HR consulting and outsourcing, benefits administration, PEO services, and an impressive array of related offerings.
Paychex payroll processing solutions come in three options; Paychex Flex Essentials, Paychex Flex Select, and Paychex Flex Pro. These packages already provide a number of HR services, but HR consulting and outsourcing, insurance and benefits plans, employee tracking solutions, and other services are also available Ala carte. The PEO service handles most HR administration, with additional customized options.
Paychex provides PEO services through its Paychex HR PEO product. As the name suggests, Paychex HR PEO offers full HR outsourcing with most of its customized packages. Paychex becomes responsible (and liable) for regulatory compliance, payroll, and benefits administration; it is no surprise that the company bundles its substantial HR capabilities with its PEO service in order to ensure smooth, compliant administration.
The service utilizes sophisticated recruiting and onboarding tools to help employers bring the best candidates onboard quickly and compliantly. Payroll administration is handled by certified professionals.
Paychex works with various national health care insurance and benefits providers, providing a wide choice of options. All administration is handled, end-to-end by Paychex.
All payroll services include payroll processing for exempt and non-exempt workers, as well as contractors. These services also come with the Paychex employee app and employer platform, tax calculation and filing, and General Ledger service that can transfer payroll data to accounting software,
Paychex Flex Select includes all of the standard features as well as General Ledger integration, which automatically integrates payroll data with a number of popular accounting software systems, such as QuickBooks Online, Sage, and XeroTM.
Paychex Flex Pro includes all of the features of Paychex Flex Select, plus automatic wage garnishment service, and Paychex Pre-Check, an employee self-service and time management app.
Paychex also offers payroll protection through the Paychex Promise service. When businesses experience an unexpected shortage of available funds or cashflow problems, Paychex Promise ensures that employees are still paid on time by extending the collection of payroll funds for up to seven days.
Due to the ease-of-use of the Paychex standalone payroll solution, Paychex Flex was judged the best payroll outsourcing solution for startups.
Paychex offers a wide range of HR services, either Ala carte or as a part of other packages. The PEO service includes full-service HR outsourcing, while other packages come with a selection of services that automate HR tasks or make a company’s HR department more efficient.
All Paychex packages include an online onboarding service for new hires and provide an archive of HR documents for both employees and business owners. All packages also provide employees with financial wellness and cashflow assistance, a set of tools (including short-term loans) that help them achieve their financial goals.
Paychex Flex Select includes all of the standard features as well as a learning management system with online courses for employees and job posting integrations for employers.
The Paychex Flex Pro service adds customizable HR analytics reports, an employee handbook builder that provides federal and state policy documentation and allows for custom business policies, pre-hire and post-hire employee background checks, as well as job costing and labor distribution reports that help determine the most profitable departments in an organization.
In addition to the HR tools offered through Paychex Flex service, Paychex offers one-on-one HR consulting. The HR consultant gives custom advice based on business owners’ goals, risk tolerance, and data collected about their business. The HR consultant can help simplify hiring processes, train employees and management, help with benefits enrollment, consult on regulatory compliance, and assist through the employee life cycle.
Other ala carte services include Paychex Flex Time, a time tracking system that can be fully integrated with the Paychex Flex platform. It includes simple timekeeping and check-in apps for smartwatches and smartphones, as well as an optional iris detection time clock that enables employee check-in in when wearing gloves. Because the system is app-based, it can also calculate mileage for traveling employees, and sync with work schedule calendars.
Additional ala carte HR services include job applicant tracking, an online performance management and review system, a secure filing system for sensitive company documents, a time and attendance tracking app, API integrations, benefits administration, 401(k) provisioning and administration, and COBRA service.
The PEO service includes employee health plans, but these are also made available to non-PEO customers as add-ons. Paychex also offers Flexible Spending Accounts, Health Savings Accounts, Health Reimbursement arrangements, and business insurance.
Last but not least, Paychex has an efficient applicant management system for companies seeking recruitment process outsourcing.
How can HR outsourcing help your business?
Paychex provides HR consultants that help maintain compliance with local regulations, it also automatically reports new hires to the relevant government agencies, and will process garnishment payments.
Basic Paychex services also include Taxpay, its automated tax administration software. Taxpay calculates the amount of tax required from payroll, files taxes, and makes the tax payments.
Paychex Flex Pro adds assistance with unemployment insurance claims processing to these standard compliance features.
Optional add-ons available to all Paychex clients include W-2 and 1099 form support, Workers’ Compensation payment and report service, and the Premium Only Plan which helps reduce employees’ taxable income as well as company payroll taxes. State Unemployment Insurance (SUI) services are also available to assist with filing and administration and help prevent fines in the future.
The Paychex platform integrates payroll software, HR management, and PEO services, for a robust end-to-end solution. The platform features a configurable dashboard, voice assist to enable hands-free reviews, payroll and HR analytics, and an events calendar. The platform is also available as a mobile app that allows employers to complete monthly payroll tasks with as little as two clicks.
The employee self-service platform is also full of features, allowing them access to earned wages, time off-requests, and choices between direct deposit, issuance of paper checks, and pay cards. Employees can even sign up for and review their benefits packages directly through the app. For employers who opt for the Flex Time add-on, the suite of time tracking and check-in tools is also seamlessly integrated into both the employer and employee platforms.
For businesses looking for even further error reduction and a more self-empowered employee experience, Paychex offers the Pre-Check app. Pre-Check is a proprietary app that won Top HR Product by Human Resource Executive in 2021, a Big Innovation award in 2022, and a Silver for at the Brandon Hall Group Excellence In Technology Awards in 2021. The app is a self-service solution for employees that combines payroll and time management functions. It lets employees review their paycheck before payday, and if there are any discrepancies or errors they are able to contact HR for clarification. The app helps improve employee satisfaction and retention by reducing payroll error, which in turn helps reduce employee turnover. According to Paychex, 73% of employees prefer self-service of this kind.
Pricing quotations are not publicly posted and are available by contacting Paychex directly.
Customer and employee reviews
Pros and Cons
- The wide variety of packages and customizations provide unique, custom options for businesses of all sizes.
- Paychex is a large, trusted, national PEO and payroll administrator. It brings a depth of administrations and consulting experience that many competitors are unable to provide.
- Pricing is not available on website, and the customized nature of the packages makes price comparison difficult.
- There are no services aimed at globally distributed remote teams, and global payroll processing is not available.
Unique Selling Point
A configurable, full-service payroll administrator, HR consultant, and PEO for businesses of all sizes. Paychex has developed a number of innovative technological solutions such as timecard apps, iris-enabled check-in equipment, multiple feature-laden employee self-service systems, and other elements that go beyond the online platforms offered by many PEOs. As a large, experienced provider, Paychex is able to branch out and provide a flexible array of services for businesses as small as a single self-employed individual, up to enterprise scale.
RemotePad Score for Paychex
4.6/5 Our expert score for Paychex
Our team came to this score by considering the following components in the following weightings:
For each component, Paychex received the following score:
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$770 per employee
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The Paychex PEO solution — our take
The flexible, wide array of features offered will be very attractive to many businesses, especially those that are cautious about jumping into a PEO partnership. The combination of HR consulting, payroll processing, insurance and benefits administration, employee time tracking options, and PEO service provides something for nearly everyone.
Growing businesses can especially benefit from the flexible suite of Paychex services. A business could, for instance, open a new regional office fully staffed by PEO employees, managed remotely through the Paychex Flex Time tracking service. All employees, both direct employees at the home office and PEO employees at subsidiaries, can be brought under a single payroll system accessed through the app and portal. All insurance and benefits plans could be brought under one umbrella, easing administration headaches, providing equal coverage to all employees, and accessing attractive packages to attract and retain top talent. As the company plots further expansion, Paychex HR consultants can help strategize and budget for future needs.
Paychex processes the payroll of 1 in 12 private employees in the US, and it is the largest HR company in the country serving small and medium-sized businesses. It currently serves over 730,000 clients, including PEO clients.
Paychex has offices in Arizona, Arkansas, California, Colorado, Connecticut, Florida, Illinois, Indiana, Iowa, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New Mexico, New York, North Carolina, Ohio, Oregon, Pennsylvania, Tennessee, Texas, and Wisconsin. It serves clients based in Europe through offices in Germany and Denmark.