The first HR system at most small companies is a folder of contracts, a shared calendar for holidays and a spreadsheet of salaries. It works until it doesn't: someone's leave balance is wrong, a contract cannot be found, a manager approves time off by text message and nobody records it.
Free HR software is a sensible next step for very small teams. Several vendors offer genuinely free plans, and two serious open-source HR systems exist for teams that can host their own software. Every free option has a limit, though, usually on the number of users, the features or who maintains it. This guide sets out exactly what each free plan includes, who it suits and when to start paying.
We describe each tool from its own website and pricing page. We have not run paid trials. Free plans change often, so check the vendor's page before you commit. Limits are as published in November 2026.
What free HR software can and cannot do
Free plans usually cover the basics well:
- Employee records: personal details, job titles, emergency contacts and documents in one place.
- Time off: leave requests, approvals and balances.
- Documents: contracts, policies and signed forms.
They rarely include:
- Payroll, which involves tax filings and liability that vendors charge for.
- Benefits administration.
- Performance management, recruiting and analytics, which usually sit on paid tiers.
- Support beyond email or a help centre.
If you need payroll, budget for it separately. If you mainly need hiring, see our guide to free applicant tracking systems.
The five free options at a glance
| Tool | Free limit | What the free plan covers | Best for |
|---|---|---|---|
| Zoho People | Up to 5 users | Employee database, time off, documents | Micro-businesses and Zoho users |
| Connecteam | Up to 10 users | All hubs: time clock, scheduling, chat, time off, documents, training, onboarding | Small deskless and shift teams |
| OrangeHRM Starter | Open source; you host it | Employee management, leave tracking, reporting | Teams with technical skills |
| Frappe HR | Open source; self-host free or cloud from $5/month | HR and payroll, leave, attendance, expenses | Technical teams wanting payroll features |
| Homebase | 1 location, up to 10 employees | Scheduling and time tracking; HR features on paid plans | Hourly teams starting with scheduling |
Zoho People
Zoho People's pricing page offers a free edition "forever free for up to 5 users", covering employee database management, time-off management and document management. Paid editions (Essential HR, Professional, Premium and Enterprise) add attendance, performance, training and more, with discounts for yearly billing.
- Strength: a proper HR database and leave system from an established vendor, with an easy upgrade path and connections to other Zoho apps.
- Watch for: the five-user cap counts users of the system, so it suits only the very smallest teams.
- Best for: founders and micro-businesses with up to five people, especially if they already use Zoho Mail, CRM or Books.
- Not for: teams that will pass five people within a few months.
Connecteam
Connecteam's pricing page describes its Small Business plan as "all hubs and all features, entirely free for up to 10 users". That covers three hubs:
- Operations: time clock, scheduling, forms and checklists, and task management.
- Communications: chat, updates, a company directory, a knowledge base and surveys.
- HR and skills: time off, documents, courses and quizzes, recognition, hiring, onboarding and an org chart.
Above 10 users, hubs are priced separately; the HR and skills hub starts at $29 a month for the first 30 users on yearly billing.
- Strength: the broadest free feature set here, built for mobile-first teams.
- Watch for: the 10-user limit, and the step to paid pricing per hub once you grow.
- Best for: small field, retail, hospitality, cleaning and construction teams where staff work from their phones.
- Not for: office-based teams that mainly need a classic HR database.
OrangeHRM Starter
OrangeHRM's website describes Starter as "completely free and open-source HR software", designed for small businesses to manage employees, track leave and run reports. The paid Advanced edition adds modules such as recruitment, performance management and payroll integration, priced by the modules you choose, with a 30-day free trial. Starter users get support through a help site, email and a community forum.
- Strength: a long-established open-source HR system with no user limits and the option to upgrade later.
- Watch for: you host, secure, back up and update it yourself.
- Best for: small and mid-sized organisations with someone technical who can run a web application.
- Not for: teams without IT support. Employee records are sensitive personal data, and a badly maintained server is a real risk.
Frappe HR
Frappe HR describes itself as a "100% open-source HR & Payroll product", covering payroll with configurable pay structures and employee loans, leave policies and encashment, mobile check-ins and rosters, and expense claims and advances. It integrates with ERPNext for accounting. Its pricing page says the software is free and AGPL-3.0 licensed. Self-hosting costs only your infrastructure, which Frappe estimates at about $40 a month for a server plus email, security and backup services and some setup and maintenance time. Managed hosting on Frappe Cloud starts at $5 a month for a single site on shared servers.
- Strength: the only free option here with payroll features, and software costs that do not rise as you hire.
- Watch for: payroll rules must be configured for your country, and statutory filings remain your responsibility.
- Best for: technical teams and businesses already using ERPNext.
- Not for: U.S. or UK businesses expecting a fully managed, tax-filing payroll service.
Homebase
Homebase's pricing page offers a Basic plan free for one location and up to 10 employees, with basic scheduling, basic time tracking, point-of-sale integration and 90 days of timesheet history. HR features sit on paid plans: PTO controls on Plus, and onboarding, document storage and HR compliance tools on All-in-One. Its hiring tools (job posts, applicant tracking and a careers page) are free on every plan.
- Strength: free scheduling, time tracking and hiring for hourly teams.
- Watch for: the free plan is not an HR database; records, documents and time-off policies require paid plans.
- Best for: single-location restaurants, shops and service businesses whose first need is scheduling.
Low-cost alternatives when free is not enough
If you outgrow a free plan, several HR systems charge only a few dollars per employee. Deel's HR page says its Core HR plan "starts at $5 per employee per month", with worker profiles, an org chart, time off, workflows, approvals and people analytics.
For a full comparison of paid systems, see our HR software guide, our pick of the best HRIS for startups under 50 employees, and our guide to HRIS software for small and medium companies.
The hidden costs of free HR software
Time. Free plans rarely include onboarding help. Budget a few hours to import employees, set up leave policies and invite staff.
Self-hosting. Open-source software is free to licence, not free to run. Frappe estimates about $40 a month in infrastructure plus maintenance time, and any self-hosted system needs the same care. Someone must apply security updates promptly.
Data protection. You are responsible for employee data whatever the price. Know where it is stored, who can access it and how long you keep it. In the UK and EU, that is a legal requirement under data protection law.
Switching later. Check that you can export employee records, documents and leave history before you start. Moving is easier if your data comes out cleanly.
Adoption. SHRM found that, on average, only 62% of employees actively use the HR technology their organisation implements. Choose a tool staff will actually open, which for deskless teams means a good mobile app.
When to upgrade
Free HR software is usually enough when you have fewer than about ten people, simple leave rules and payroll handled elsewhere. Upgrade when:
- you reach the free plan's user limit, or will soon;
- you need payroll, benefits or performance reviews in the same system;
- leave rules become complex, with several policies, accruals or locations;
- managers need reporting on headcount, absence or turnover;
- you need proper support when something goes wrong.
The cost of poor HR basics shows up in turnover. Gallup found that 42% of employees who voluntarily left their organisation said their manager or organisation could have done something to prevent it. Good records and regular check-ins are not a cure, but they help managers notice problems early.
Setting up free HR software in a week
Day 1: choose and sign up. Pick the tool whose limit you will not hit in the next year.
Day 2: import people. Add each employee's details, job title, start date and manager. Upload signed contracts.
Day 3: set up time off. Enter your holiday year, entitlements, public holidays and approval rules. Check balances carry over correctly.
Day 4: add documents. Upload your handbook and key policies, and ask employees to acknowledge them if the tool supports it.
Day 5: invite staff. Show managers how to approve requests, and staff how to book leave on mobile.
Day 6: set access. Limit who can see salaries and personal data.
Day 7: retire the spreadsheet. Archive old files so everyone uses one source of truth.
Frequently asked questions
Is there completely free HR software?
Yes. Zoho People is free for up to 5 users and Connecteam for up to 10 users. OrangeHRM Starter and Frappe HR are free open-source software with no user limits, but you must host and maintain them or pay for hosting.
What is the best free HR software for small businesses?
For office-based micro-businesses, Zoho People's free plan covers records, leave and documents. For deskless and shift-based teams of up to 10, Connecteam's free plan includes scheduling, time clock, chat and HR tools. Technical teams can use OrangeHRM Starter or Frappe HR.
Does free HR software include payroll?
Usually not. Among the options here, only Frappe HR includes payroll features, and you remain responsible for configuring and filing taxes. Most businesses pair free HR software with a separate payroll provider.
Is open-source HR software safe?
It can be, if it is hosted securely, updated promptly and backed up, with access restricted. Without someone to manage that, a hosted free plan is safer for employee data.
When should I pay for HR software?
When you pass a free plan's user limit, need payroll, benefits or performance management in one place, or need reliable support. Paid plans from around $5 per employee per month are available for small teams.