Small business owners don’t have time for a sales call to find out how much administrative tools—like payroll software—charge. Instead, most want to see the price laid out on a provider’s website. In short, they want payroll pricing transparency.
What exactly is payroll pricing transparency and why does it matter?
What is pricing transparency?
Payroll pricing transparency means you can see what a payroll service costs, what that cost includes, and what costs extra (if anything) before you talk to a salesperson or commit.
Transparency requires the pricing information to be easily visible and accessible.
In short, the pricing isn’t transparent if you can only learn the price by booking a call and giving your number or email address away.
Payroll pricing transparency means the pricing is:
- Visible: Anyone can see the published price.
- Clear: The price clearly tells you what it does and doesn’t include.
- Predictable: You can estimate cost changes as you hire new workers or add services.
Why lack of pricing transparency makes comparisons difficult
Many business owners want to know four basic things:
- What’s it cost?
- How much time is it going to take me?
- Can it do what I need it to do?
- Do they have good support if I need them?
Shopping for payroll software should be straightforward. You have a business and a number of employees, and you want to know what it will cost to pay them.
But if you’ve compared payroll providers, you know there’s always a hitch.
Some providers show you a price right away. Others ask you to fill out a form, wait for a call, and sit through a demo before you see a number.
Lack of true payroll pricing transparency makes it difficult to compare providers based on cost, one of the leading factors in the shopping process. Instead of compiling a quick shortlist, you have to pause your comparison journey and talk to a salesperson.
Common payroll fees to look for
When you compare published pricing, check which of these fees apply:
| Fee | What It Is |
|---|---|
| Base fee | A fixed monthly, annual, or per-payroll charge for the service. |
| Per-worker fee | A charge for each employee or contractor you pay. |
| Setup fee | A one-time fee providers may charge to set up your account. |
| Off-cycle payroll fee | A fee providers charge for payroll runs outside your regular schedule (e.g., bonus). |
| Tax filing fee | A charge to calculate, file, and deposit payroll taxes. |
| Year-end form fee | A fee to prepare and file W-2s and 1099s. |
| Multi-state filing fee | A charge for each additional state you need to file payroll taxes in. |
| Support tier fee | A higher price for phone support or a dedicated representative. |
| Early termination fee | A charge to cancel before the contract ends. |
Questions a transparent provider can answer without a phone call
A provider with transparent payroll pricing should be able to answer the following questions on its website.
- What’s the base fee? Is it monthly, annual, or charged each time you run payroll?
- What’s the per-employee fee? Do contractors cost the same as employees?
- Are unlimited payroll runs included? What about off-cycle, bonus, or correction payrolls?
- Is payroll tax filing included? Does that cover federal, state, and local taxes? What exactly does the provider handle?
- Are year-end forms included? Does the provider file W-2s and 1099s at no additional cost, or is there a separate fee?
- What does multi-state payroll cost? Is there a fee for each additional state? Do you have to upgrade your plan to get multi-state payroll tax filing?
- Is setup free? Can an onboarding team help you if you get stuck?
- What support comes with your plan? Is support included, or is better support tied to a higher tier?
- Is there a contract? Can you cancel anytime, or do they lock you in?
- What will my total bill be? Can you figure out your total service fees with a quick calculation?
The provider should readily lay out answers to these questions on their website. Otherwise, you may want to look elsewhere if transparent pricing is important to you. Pricing that requires you to talk to a salesperson makes it hard to compare providers side by side and know whether you got a good deal.
What I appreciate most is how transparent and affordable [Patriot Software’s] pricing is – no hidden fees, and everything is clearly explained.” —Lola H
Why don’t all payroll companies publish their prices?
Lack of transparent pricing makes price shopping more difficult, but it’s not necessarily nefarious. Some payroll providers don’t publish their pricing because:
- Pricing varies by customer: Different customers may pay different amounts for the same service, depending on how they negotiate the deal.
- Bundling: Payroll might be part of a larger package of HR, benefits, etc., so there may be a discount depending on how many services you add.
- Sales-led business models: A salesperson on the phone is more likely to close a deal and upsell a product than a commitment-free pricing page.
At the end of the day, some businesses need a complex solution, so getting a customized price from a salesperson makes sense. But for most small businesses, a consultation isn’t necessary to get transparent pricing for the features you need.
Is a sales call or pricing consultation worth it?
Having a conversation with a provider to get pricing can be helpful for businesses with complex needs that want a customized solution.
However, many small business owners don’t care about pricing based on a customized payroll package. They want something that gets the job done so they can run payroll and get back to work.
How to compare payroll pricing
Ready to compare payroll software costs? Use the following steps to get started.
How to compare payroll pricing steps:
- Start with published prices.
Make a list of payroll providers you’re interested in, and include their total costs. Note any providers without transparent pricing that require a sales call, and set aside time to talk with them to get your total costs.
- Build a like-for-like comparison.
Add up each provider’s total monthly cost for your headcount and needs. Include any extra fees for things like multi-state payroll, year-end filing, etc.
- Determine who has a contract.
Make a note of who requires a long-term contract and who has month-to-month pricing. If month-to-month is important to you, rule out providers that require contracts.
- Read reviews.
Find out what others’ experiences have been like. Explore any negative reviews to find out if the situation could apply to you.
- Test the support.
Contact support to find out what you can expect after you sign up.
Frequently asked questions about pricing transparency
Payroll pricing transparency means you can see a provider’s price, what it includes, and what costs extra without talking to a salesperson. If you have to request a quote to learn the price, the pricing isn’t fully transparent.
Some providers negotiate prices customer by customer, bundle payroll with other HR or benefits products, or rely on sales calls to close deals and add services.
Published prices are accurate when they clearly list everything you’ll pay for, including any extra fees for add-ons. Check whether tax filing, year-end forms, and support are included.
Most providers charge a monthly base fee plus a fee for each employee or contractor you pay. Some also charge per payroll run, so ask whether they offer unlimited payrolls or not.
Not all providers include year-end filing in their advertised monthly price. Make sure to note all extra fees, like year-end filing, when comparing pricing across providers.
Not always; some providers do not require a long-term payroll software contract. Determine how important this is to you, and opt for a provider without a contract if you want the flexibility to cancel anytime.
A custom quote can make sense for businesses with complex needs, but most small businesses want transparent pricing so they can easily compare pricing by provider.
Common extra charges include setup fees, multi-state filing fees, year-end form fees, off-cycle payroll fees, and fees for higher support tiers. Transparent payroll providers should make all fees easily accessible.
The bottom line: Is payroll pricing transparency important?
Pricing transparency is a simple test: Can you see what you’ll pay, what it includes, and what costs extra without a sales call?
If that all matters to you, you likely value pricing transparency.
At Patriot Software, you can view our payroll pricing here on our pricing page. You can calculate your base fee, per worker fee, and any additional costs (e.g., time and attendance software). And, our free USA-based customer service is available if you have any questions about what you’d pay. No contracts, no hidden fees, and no sales call required.
This is not intended as legal advice; for more information, please click here.
