HR 2.0: Leveraging Payroll Integration for Data-Driven Decisions

Enhancing data flow across ATS, core HR, ERP, and time-tracking platforms

Managing payroll is essential for any business, but it’s often one of the most complex and time-consuming tasks for human resources (HR) and payroll teams. HR departments must onboard new hires from their ATS (applicant tracking system) into their preferred payroll app. 

And companies must process employee salaries, tax deductions, and employee data accurately and on time. Manual payroll processes or disconnected systems can lead to errors, inefficiencies, and delays, ultimately affecting employee satisfaction and retention.

Enter payroll integration, automation that frees HR and payroll teams from manual data entry! By connecting payroll with other essential apps—such as the ATS in human resources (HR), enterprise resource planning (ERP) in Finance, and time tracking in core HR apps — companies ensure that employee records, salary information, time tracking, and other payroll-related details stay accurate and consistent across different systems. With accurate, real-time employee data, businesses make better decisions, reduce administrative workload, and enhance overall workforce management.

In this article, we explore how payroll integration works, highlight key payroll integration examples, and provide real-world case studies of businesses that have successfully streamlined their payroll operations.

What Are Integrated Payroll Systems?

Integrated payroll systems are software solutions that connect payroll processing with other key business functions and HR apps. Rather than handling payroll as a standalone function, integration seamlessly flows data across departments and apps, reducing manual data entry and errors.

Core Components of Integrated Payroll Systems

• Automated Payroll Processing – Calculates salaries, deductions, and bonuses based on real-time employee data.
• Employee Database Synchronization – Ensures payroll data always aligns with HR records and time tracking.
• Real-Time Reporting & Analytics – Provides insights into payroll expenses and workforce costs.

How Integrated Payroll Differs from Traditional Payroll

The traditional payroll process often requires manual data entry or manual file uploads with employee data. The old method is burdened by separated data between HR and accounting, leading to inefficiencies and potential discrepancies. Integrated payroll systems, on the other hand:
 

• Eliminate data silos by syncing payroll with other HR tools like the ATS, CoreHR, and ERP systems.
• Reduce errors by automating calculations and working with fresh data. 
• Improve record-keeping by connecting all payroll data across necessary systems.

By adopting an integrated payroll system, businesses can efficiently manage employee onboarding and compensation and ensure that payroll data is always accurate.

Examples of Payroll Integrations

Experts in payroll integration for popular payroll applications (like ADP, Paylocity, Paychex, Paycom, and more) report the four most popular payroll integrations in 2025. They are:  

ATS to Payroll Integration

Applicant tracking system (ATS) integration provides HR professionals with a big efficiency boost. Recruiting takes time, but ATS integration streamlines the process by syncing hiring data with payroll.

Without data integration, HR teams manually transfer new hire information between disconnected systems, increasing the risk of errors and delays. With automated data syncing, information updates in real-time, ensuring a seamless hiring and onboarding experience.
 

• New Hires from ATS to Payroll: As soon as a hiring manager presses the hire button in the ATS, new hire data automatically syncs in the payroll system in near real-time with the essential information needed to process payroll.

According to the Director of People Operations at Hopscotch Primary Care, “One connector liberated our HR team from over 20 hours of laborious manual data entry each month, boosting overall team satisfaction and contributing to a remarkable 100% increase in morale. Easiest integration solution I’ve ever experienced.”

Instead of spending hours chasing missing documents or correcting payroll mistakes, HR professionals can focus on strategic hiring, employee engagement, and retention. 

Core HR to Payroll Integration

Many companies manage changes to employee salaries or bonuses in their core HR system—as well as promotions or transfers to other departments or locations. Integrating payroll with Core HR systems ensures that employee data remains consistent and up-to-date across platforms. This integration offers key benefits:
 

• Seamless Employee Updates: Any changes to existing employee information, like promotions, department transfers, or salary adjustments, automatically reflect in the payroll system. Automation ensures that payroll calculations are based on the most current data, enhancing accuracy.

Payroll & ERP Integration

Integrating payroll with ERP systems streamlines financial management by automating accounting journal entries between payroll processing and accounting functions. ERP integration offers several key benefits:
 

• Automated Payroll Journal Entries: Payroll data, including earnings, deductions, and taxes, automatically transfers into the ERP. This automation eliminates manual data entry, reducing errors and saving time.
• Expense Reimbursement Processing: Approved employee expense reimbursements recorded in the ERP can be seamlessly imported into the payroll system. This ensures timely and accurate reimbursement processing, covering expenses such as travel, mileage, or cell phone usage.

Payroll to ERP integration is an enormous time-saver for payroll and accounting teams. One IT services firm experienced huge inefficiencies due to manual payroll data entry into their ERP. To address this, they connected Paylocity with NetSuite, their payroll app with ERP. This solution automated payroll data transfer, including earnings, taxes, and deductions, into NetSuite, creating consolidated journal entries per payroll run. 

“The Paylocity to NetSuite integration has had a positive effect across the company,” said the Senior Consultant from Sparkhound. Automation saves the accounting team 40 hours a month, which translates into a full week of work every month. 

Payroll & Time Tracking Integration

Connecting payroll systems with time-tracking applications streamlines the process of calculating employee compensation based on actual hours worked. Key advantages of this integration include:
 

• Accurate Time and Attendance Data Transfer: Employee work hours, overtime, and leave recorded in the time-tracking system are automatically imported into the payroll system. Automation ensures precise calculation of wages and overtime pay, reducing discrepancies and disputes.

Benefits of Implementing Integrated Payroll Systems

Integrating your payroll system streamlines payroll processes and improves accuracy. Key benefits include:
 

• Reduced Administrative Workload: Eliminates duplicate data entry, freeing HR and finance teams for strategic tasks.
• Improved Payroll Accuracy: Automatic data synchronization reduces errors in wages, deductions, and tax calculations.
• Real-Time Employee Data Updates: Ensures payroll reflects the latest salary adjustments, promotions, and new hires.
• Faster Payroll Processing: Automates calculations, enabling timely and efficient payroll runs.
• Enhanced Financial Visibility: Payroll expenses integrate with ERP systems, supporting better budget planning.
• Increased Employee Satisfaction: Timely and accurate payroll and reduced manual data entry improve overall employee fulfillment. 

Conclusion

Payroll integration streamlines payroll processes, reduces errors, and improves data accuracy by connecting payroll with your ATS, Core HR, ERP, and time-tracking systems. Automation eliminates manual data entry, ensures real-time employee data updates, and enhances financial visibility. Case studies highlight how payroll integration saves time, improves accuracy, and reduces administrative burdens. As businesses grow, efficient payroll solutions become essential. Investing in payroll integration enhances operations, financial oversight, and employee experience, making data connectors a key strategy for long-term success.

Pierre-David Otis is VP–People & Culture at Flexspring. Pierre-David is passionate about the connections between humans and machines and how this connection will shape the future of thousands of human lives with emerging technology.