Paychex, Inc. (Paychex) operates as a human capital management (HCM) company.
The company delivers a full suite of technology and advisory services in human resources (HR), employee benefit solutions, insurance, and payroll processing. As of May 31, 2025, the company served approximately 800,000 clients and their employees across the U.S. and parts of Europe.
The company specializes in helping clients adapt to the rapidly evolving environment. Paychex offers a full range of integrated HCM solu...
Paychex, Inc. (Paychex) operates as a human capital management (HCM) company.
The company delivers a full suite of technology and advisory services in human resources (HR), employee benefit solutions, insurance, and payroll processing. As of May 31, 2025, the company served approximately 800,000 clients and their employees across the U.S. and parts of Europe.
The company specializes in helping clients adapt to the rapidly evolving environment. Paychex offers a full range of integrated HCM solutions from hire to retire for businesses and their employees that enables customization to the clients' businesses, whether it is small or large, simple or complex. The company has the breadth of solutions to cover the full spectrum of the employee life cycle, while also enabling integrations with popular HR, accounting, enterprise resource planning (“ERP”), and point-of-sale applications.
Key features of the company’s solutions include: comprehensive cloud-based HCM platforms optimized to meet clients' HR and payroll needs; expertise in HR and payroll backed by approximately 250 compliance experts and over 650 HR business professionals; streamlined workforce management that combines technology with flexible, tech-enabled support options; modern, mobile, and intuitive user experience with self-service capabilities; scalable and customizable platforms that provide clients the flexibility to add solutions as they grow; software as a service, or SaaS, delivery model that reduces total cost of ownership for its clients; and advanced data analytics and artificial intelligence (AI) capabilities powered by large data sets.
The company markets its solutions through a combination of direct and virtual sales forces, which are supported by various digital lead generation and multi-channel marketing initiatives.
On April 14, 2025, the company completed its acquisition of Paycor HCM, Inc. (Paycor), a leading provider of HCM, payroll, and talent software. The transaction aims to enhance the company’s capabilities upmarket, expand its sales force, and enhance its suite of AI-driven HCM solutions.
Strategy
The company's strategy is to be the digitally driven HR leader, serving as an essential partner to clients by providing them with the technology and advisory solutions they need for HR, payroll, benefits, and insurance. The company intends to strengthen and extend its position as a leading provider through continued investments in both its innovative technology and HR advisory solutions.
Key elements of the company's strategy include growing the company’s client base; expanding its share of wallet; driving technology innovation; and pursuing strategic acquisitions.
Clients
The company provides HCM solutions to a diverse client base operating in a broad range of industries throughout the U.S. and parts of Europe. The flexibility and scalability of the company's solutions enable its clients to select the best solution that meets their needs. The company utilizes service agreements and arrangements with clients that generally do not contain specified contract periods and may be terminated by either party with 30-days’ notice of termination. For fiscal 2025, the company’s client retention of Paychex clients was in the range of 82% to 83% of its beginning client base.
Solutions
The company provides a unique blend of innovative technology solutions, backed by its extensive compliance and HR expertise, that help customers more effectively hire, develop, and retain top talent in this challenging workforce environment. Clients have the option of processing payroll online using the company's SaaS technology, outsourcing to its payroll specialists, or using a combination of these methods. Payroll is integrated with HCM software modules for clients who have more complex HR needs. The company continues to invest in its technology, enhancing its solutions to continuously improve the customer and employee experiences from hire to retire.
The company also provides comprehensive HR outsourcing through its administrative services organization (ASO) and professional employer organization (PEO) solutions. The company has over 650 HR business professionals who are dedicated to its clients and possess the experience and training to provide HR best practices and advice. The company's HR business partners are available to provide its ASO and PEO clients with guidance on HR issues. The integration of leading-edge technology and flexible support options enables the company to meet its clients’ needs, from the tactical to the strategic.
The company closely monitors the evolving challenges and needs of its clients, and proactively aids its clients in navigating macroeconomic challenges, legislative changes, and other complexities they may face. Over the past year, top challenges for employers included macroeconomic pressures, including inflation and interest rates, availability of qualified talent, providing appropriate employee development, keeping technology current, and ensuring legal and regulatory compliance. The company has approximately 250 compliance professionals who are in real-time contact with tax agencies and regulators to understand upcoming or newly enacted laws and regulations. The contributions of these compliance experts are intended to ensure that the company’s HCM solutions are updated in a timely fashion to adhere to applicable regulations and to help its clients stay in compliance.
Management Solutions:
The company offers a comprehensive portfolio of HCM technology and HR advisory solutions that enable its clients to meet their diverse HR and payroll needs.
HCM Technology: The company delivers an integrated suite of HCM solutions through three technology platforms that enable seamless workforce management throughout the employee life cycle, from recruiting and hiring to retirement. SurePayroll serves the digitally driven small business self-service market. Paychex Flex is the company's proprietary HCM Software-as-a-Service (SaaS) platform for small and medium-sized businesses. Paycor is the company's primary SaaS-based HCM platform for larger businesses with more complex needs. Clients can select the modules they need and easily customize solutions as they grow, including Payroll, HR, Talent Acquisition, Talent Management, Benefits Administration, and Workforce Management.
Payroll Solutions: The company’s payroll processing solutions include the calculation, preparation, and delivery of employee payroll checks; production of internal accounting records and management reports; preparation of federal, state, and local payroll tax returns; and collection and remittance of clients’ payroll obligations. The company’s powerful calculation engine enables fast and accurate payroll processing. The company provides employers with the option of paying their employees by direct deposit, payroll debit card, a check drawn on a Paychex account, or a check drawn on the employer’s account and electronically signed by the company, or by ACH. The company gives employees the flexibility to access earned pay before the scheduled pay date.
HR Management: A comprehensive suite of HCM tools spanning HR, regulatory compliance, compensation management, employee surveys, expense management, reporting, and analytics. Robust workflows and approval capabilities help leaders expedite and automate their most common tasks. Digital communication and engagement solutions help strengthen connections and keep associates engaged.
Talent Acquisition: Innovative set of tools designed to streamline and optimize the entire hiring process, from sourcing and attracting candidates to managing the recruiting process. This all-in-one solution empowers HR teams to efficiently manage talent acquisition, improve time-to-hire, and make data-driven decisions to build a high-performing workforce.
Talent Management: Powerful tools for managing employee development and retention, spanning performance management, HR compliance, career development, and reporting. The company offers businesses the flexibility to capture ongoing performance feedback, recommend and enroll employees in specific training courses, and leverage automated workflows to track progress and approve compensation changes tied to performance.
Workforce Management: Comprehensive workforce management solutions to optimize labor costs and enhance productivity through integrated time and attendance, scheduling, and labor management tools. Paychex integrates these capabilities within its core platform, providing features for job costing, labor distribution, and expense management for detailed control over operational spending. For upmarket and enterprise clients, the offering emphasizes automation and analytics, featuring AI-powered labor forecasting, real-time overtime insights, and robust employee self-service capabilities for tasks like mobile punch-in and shift trading.
Benefits Administration: Software that provides comprehensive benefit administration capabilities for streamlined plan set-up, configuration, and management. It facilitates a simplified and engaging experience for employees during open enrollment and for life event-based changes through intuitive self-service tools. The platform supports a wide array of benefit types, including group health, FSA/HSA, and voluntary benefits, and includes features for compliance management, such as COBRA administration. For seamless operations, it features robust reporting and analytics for administrators and ensures data accuracy through direct carrier connectivity, which automates the transfer of enrollment information to benefit carriers.
Partner Marketplaces: Paychex Flex Perks is a curated digital marketplace for employee benefits, including early access to earned wages, financial wellness solutions, and voluntary lifestyle benefits. Paycor’s Marketplace provides businesses best-in-breed third-party applications and trusted technology partners to seamlessly connect their favorite solutions to Paycor.
ASO Solutions: The company’s HR solutions allow businesses to outsource and simplify their HR administration and compliance support. These bundled services incorporate integrated HCM technology solutions and HR advisory services through both virtual and on-site availability of a professionally trained HR representative. Clients can opt for different levels of HR outsourcing, from the company’s low-touch HR solutions to its full-service HR Pro package. The company also offers HR support to non-payroll clients through its HR Partner Plus solution.
Retirement Solutions: The company’s retirement solutions offer a variety of options to employers, including 401(k) plans, SIMPLE and SEP IRAs, and Pooled Employer Plans, among others. These solutions provide plan implementation, ongoing compliance with government regulations, employee and employer reporting, participant and employer online access, electronic funds transfer, and other administrative services. Clients may choose from a group of pre-defined fund selections or customize their investment options within their plan. The company is the largest 401(k) recordkeeper for small businesses in the U.S. The company’s large-market retirement solutions include relationships with financial advisors.
Funding Solutions: The company offers various funding solutions. Its wholly owned subsidiary, Paychex Advance, LLC, provides a portfolio of solutions to the temporary staffing industry, including payroll funding (via the purchase of accounts receivable). Alterna Capital Solutions, LLC (Alterna) offers funding to small businesses through the purchase of outstanding accounts receivable balances under non-recourse agreements.
PEO and Insurance Solutions:
The company provides comprehensive employment outsourcing and insurance solutions to best meet its clients’ needs.
PEO Solutions: The company’s licensed PEO subsidiaries offer businesses a combined solution that includes payroll, employer compliance, HR and employee benefits administration, risk management outsourcing, and both virtual and on-site availability of a professionally trained HR representative, among other solutions. What differentiates the company's PEO solutions from its ASO solutions is that the company serves as a co-employer of its clients’ employees and assumes the risks and rewards of certain workers’ compensation insurance and specific health insurance offerings. The company is certified under the Small Business Efficiency Act to provide PEO solutions. The company also provides insurance offerings that help business owners protect their bottom line from unforeseen costs, including cyberattacks and employee lawsuits.
Insurance Solutions: The company’s licensed insurance agency, Paychex Insurance Agency, Inc., provides insurance through a variety of carriers, allowing employers to expand their employee benefit and corporate offerings at an affordable cost. Insurance offerings include property and casualty coverage such as workers’ compensation, business-owner policies, cybersecurity protection, commercial auto, and health and benefits coverage, including health, dental, vision, and life. The company’s insurance solutions simplify the insurance process to make it easy to find plans with the features and affordability to meet the client’s needs. With access to numerous top national and regional insurance carriers, the company’s professional insurance agents have access to a wide selection of plans from which they can best match the insurance needs of small businesses. Additionally, clients can integrate their insurance plans with Paychex payroll processing for easy, accurate plan administration.
Sales and Marketing
The company markets and sells its solutions primarily through its direct sales force based in the markets it serves. The company’s direct sales force includes field and inside sales representatives who specialize within its portfolio of solutions. The sales representatives are also supported by marketing, advertising, public relations, and various other demand generation programs.
In addition to its direct selling and marketing efforts, the company utilizes other indirect sales channels such as its relationships with existing clients, certified public accountants (CPAs), benefit brokers, and banks for new client referrals. More than 50% of the company’s payroll clients come from these referral sources. The company’s dedicated business development group drives sales through banking, national associations, and franchise channels. Complementing its direct sales, the company’s Embedded HCM Solution partnerships efficiently extend its distribution while providing a modern, holistic solution to customers. The company also utilizes digital marketing to promote its solutions.
The company has a long-standing partnership with the American Institute of Certified Public Accountants (AICPA) as the preferred payroll provider for its AICPA Business Solutions Program. The company’s partnership agreement with the AICPA is in place through September 2027. The company also partners with numerous state CPA society organizations. The company provides a free online portal, Paychex Partner Pro, designed to give accountants quick access to critical data, reporting, and insights for their clients using Paychex Flex. This innovative portal transforms how CPAs manage their portfolios by providing a centralized hub for accessing client payroll and HR data, resolving issues, and identifying missing information, empowering them to operate with greater efficiency and proactivity in serving their clients.
The company also has long-standing relationships with health insurance and retirement benefits brokers, including large national partners. The company recently launched the Partner+ Program to foster broker relationships and drive mutual growth. The company has a broader suite of solutions to offer brokers, which can supplement their offerings to clients, and the Partner+ Program provides a structured framework designed to safeguard mutual clients from competing products. In addition, the company’s Partner Portal provides brokers with exclusive access to advanced HCM solutions, new revenue streams, and data-driven insights.
The company’s corporate website is available at www.paychex.com and serves as a cost-efficient channel that acts as a source of leads and new sales while complementing the efforts of its direct, indirect, and virtual sales forces. The website enables the company to market to existing and prospective clients who want to learn more about its solutions and support, and it offers information about the company’s core business solutions: human resources, payroll, benefits, and insurance.
Paychex also builds on its reputation as an expert in the HCM industry by providing educational resources to its clients. The company provides free webinars, podcasts, white papers, and other information on its website to inform businesses about the impact of regulatory change, as well as HR and business best practices. Paychex WORX and the Paycor HR Center for Excellence provide information on the latest trends, best practices, and industry benchmarks designed to drive business success.
The company also tracks current regulatory issues that impact the business community and provides regulatory updates. The company issues small business trend reports through its monthly Paychex Small Business Employment Watch.
Intellectual Property
The ‘Paychex’ name, trademark, and logo are of material importance to the company.
Seasonality
During the company's third fiscal quarter, which ends in February, the number of new payroll clients, new retirement solutions clients, and new worksite employees associated with its HR Outsourcing businesses tends to be higher than during the rest of the fiscal year (year ended May 31, 2025), primarily because many businesses prefer to start using the company's solutions at the beginning of a calendar year. In addition, calendar year-end transaction processing and client funds activity are traditionally higher during the company's third fiscal quarter due to year-end bonus payments, additional year-end services, and the preparation and delivery of end-of-year reporting requirements.
History
Paychex, Inc. was founded in 1971. The company was incorporated in Delaware in 1979.
