Managing operations and staff is a balancing act in the fast-paced restaurant industry. You must prioritize customer satisfaction and food quality and address high turnover, complex scheduling, tip distribution, and evolving labor laws. Utilizing payroll software tailored for restaurants can notably enhance the difference in your operations.
As a restaurant owner or manager, you manage various daily operations. However, payroll, compliance, and employee morale become crucial as your restaurant grows. Technology offers solutions to simplify these tasks, helping you reclaim your time. With the right payroll software, you can focus on what matters—creating exceptional dining experiences and enhancing your restaurant's success business.
Since 1967, Lift HCM has led the way in providing payroll solutions for the restaurant sector. With extensive expertise in handling the intricacies of restaurant payroll, we’re prepared to help you choose the ideal software for 2025. By the end of this guide, you’ll understand the payroll solutions that suit your restaurant's requirements and how to implement them effectively and efficiently.
Table of Contents
- Why Restaurants Need Specialized Payroll Software
- Key Benefits of Restaurant Payroll Software:
- Must-Have Features in Restaurant Payroll Software
- Top Restaurant Payroll Software in 2025
- How to Choose the Right Payroll Software for Your Restaurant
- Take Control of Your Restaurant Payroll in 2025
Why Restaurants Need Specialized Payroll Software
The restaurant industry presents unique payroll challenges. From high turnover rates to handling tips and variable shifts, restaurant payroll requires more than a one-size-fits-all solution. According to the National Restaurant Association, the industry saw a 75% turnover rate in 2023, far exceeding the U.S. average across other sectors. This constant churn, combined with intricate scheduling and evolving labor laws, demands a specialized approach.
Key Benefits of Restaurant Payroll Software
- Streamlined Payroll Processing: Simplifies handling tips, multiple pay rates, and shift differentials.
- Simplified Scheduling and Time Tracking: Automates employee schedules while ensuring compliance with labor laws.
- Improved Compliance Management: Reduces errors and helps avoid costly penalties.
- Enhanced Employee Onboarding: Speeds up new hire processes with digital tools.
- Better Communication: Improves staff coordination with built-in communication tools.
By leveraging software designed for the industry, restaurant managers can save time, reduce errors, and enhance overall operations.
Lift HCM: A Proven Partner for Restaurant Payroll Since 1967
For over five decades, Lift HCM has been a trusted name in restaurant payroll solutions. From managing tip distribution to navigating compliance challenges, we’ve been at the forefront of innovation, helping restaurant owners streamline operations.
What Sets Lift HCM Apart:
- Expertise in tip management and compliance
- Integration with leading POS and scheduling tools
- Dedicated support tailored to restaurant owners
- Scalable solutions for businesses of all sizes
Swipe Through the Past! Enjoy a Glimpse of a Couple of Our Classic 1970s Marketing Materials! *Before becoming Lift HCM, we were known as RPS.
Must-Have Features in Restaurant Payroll Software
When evaluating payroll software for your restaurant, here are the must-have features to ensure a smooth and efficient payroll process:
1. Employee Scheduling and Time Tracking
Efficient scheduling is critical in restaurants. The software should integrate time tracking with payroll to eliminate discrepancies. A 2023 study by Toast found that restaurants using digital scheduling tools reduced labor costs by 5% and boosted employee satisfaction by 3%.
2. Payroll Management
Restaurants often have unique payroll needs, from handling tips to managing multiple pay rates across shifts. Your software should handle these complexities with ease, ensuring that payroll is processed accurately and on time every time.
3. Compliance and Reporting
Compliance is critical in the restaurant industry. In 2022 alone, the U.S. Department of Labor recovered over $27 million in back wages for food service workers due to payroll errors. The right payroll software should help you stay compliant by offering built-in reporting tools that simplify audits and keep you on track with labor laws.
4. Onboarding and Training
Given the restaurant industry's high turnover rate, an efficient onboarding process is essential. Look for software that offers digital onboarding and training management so new hires can quickly get up to speed.
5. Communication Tools
Good communication is key in any fast-paced environment like a restaurant. Payroll software with built-in messaging, announcements, and shift-swapping capabilities will help ensure smooth operations and keep everyone on the same page.
Top Restaurant Payroll Software in 2025
Regarding payroll software for restaurants, several platforms stand out for their ability to handle the industry's unique demands. Below are the top options to consider:
1. Gusto
Gusto provides a complete HR and payroll solution featuring an intuitive interface, making it suitable for small to medium-sized restaurants. It manages payroll, benefits administration, and compliance, though it may fall short on advanced features needed by larger companies and isn't specifically designed for the restaurant sector.
Key Features
- Full-service payroll with tax filings
- Benefits administration
- Employee self-service portal
- Time tracking
- New hire reporting
| Pro's | Con's |
| User-friendly interface | Limited advanced features for larger businesses |
| Transparent pricing | Time tracking features cost extra |
| Comprehensive HR features | Can be pricier for businesses with many part-time employees |
| Good for small to medium businesses | Lack of specialized industry features |
Biggest Takeaway: Gusto serves as a great option for small to mid-sized businesses seeking a user-friendly and all-inclusive payroll and HR solution. It includes essential features such as compliance assistance and benefits management. Nevertheless, organizations with larger teams, employees overseas, or unique requirements may discover its scalability and customization capabilities to be somewhat restricted.
2. Toast
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Designed specifically for the restaurant industry, Toast integrates seamlessly with its POS system, offering time tracking, scheduling, and tip reporting features. It’s best suited for restaurants already using or willing to switch to Toast’s ecosystem, though it may be costly and complex for smaller establishments.
Key Features
- Integrated with POS system
- Automatic tax filings and payments
- Time tracking and scheduling
- Multiple pay rates for different roles
| Pros | Cons |
| Tailored for the restaurant industry | Can be expensive for smaller restaurants |
| Seamless integration with Toast POS | Requires using Toast's POS system for full benefits |
| Comprehensive restaurant-specific features | May have a steeper learning curve due to extensive features |
Biggest Takeaway: Toast is a powerful and feature-rich platform that offers excellent tools for restaurant management, especially for businesses that need a robust POS system with integrated functionality. However, its cost and potential implementation challenges make it best suited for businesses with a budget to invest in technology and the time to manage setup and training.
3. ADP Run
ADP Run is a flexible HR and payroll solution ideal for larger or expanding restaurants. It provides strong compliance support along with a variety of features; however, it can be costly and might include more than what smaller restaurants require need.
Key Features
- Comprehensive payroll and HR services
- Tax filing and compliance support
- Mobile app for employers and employees
- Time and attendance tracking
- Talent management tools
| Pros | Cons |
| Scalable for growing businesses | Can be expensive for smaller businesses |
| Strong reputation and reliability | Interface may be less intuitive than newer competitors |
| Extensive compliance support | May offer more features than small restaurants need |
Biggest Takeway: ADP Run is a reliable and scalable solution ideal for small businesses planning to grow, offering a comprehensive suite of payroll and HR features. However, its higher cost, less transparent pricing, and occasional complexity may not make it the best choice for very small businesses or those seeking simplicity. For those who value scalability, robust compliance support, and integration capabilities, ADP Run can be a strong option.
4. Square Payroll
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Square Payroll offers an intuitive and cost-effective solution that seamlessly integrates with Square POS, making it an excellent option for small to medium-sized restaurants. However, it might not provide the advanced HR functionalities and restaurant-specific tools that larger businesses require need.
Key Features
- Integrates with Square POS
- Full-service payroll with tax filings
- Time tracking and scheduling
- Next-day direct deposit
- Tip reporting
| Pros | Cons |
| Seamless integration with the Square ecosystem | Limited advanced HR features |
| User-friendly interface | Best benefits realized when using other Square products |
| Affordable for small businesses | May lack some industry-specific features for larger restaurants |
Biggest Takeway: Square Payroll is a great option for small businesses, particularly those already using Square POS, thanks to its ease of use, affordable pricing, and seamless integration with the Square ecosystem. However, businesses with more advanced HR needs or scalability requirements may find it limiting. It’s best suited for small, service-based businesses like retail shops, salons, or restaurants.
5. OnPay
OnPay provides comprehensive payroll solutions with automated tax filings and links to accounting and time-tracking software. Known for its user-friendly interface and scalability, it is an ideal choice for growing restaurants businesses.
Key Features
- All-in-one payroll and HR solution
- Tax filings and payments
- HR tools (onboarding, PTO tracking)
- Employee self-service portal
- Multiple pay rates and schedules
| Pros | Cons |
| Transparent, competitive pricing | Limited integration with restaurant-specific POS systems |
| Good balance of payroll and HR features | May lack some advanced features for larger businesses |
| Handles complex payroll situations well | Less name recognition compared to bigger competitors |
Biggest Takeaway: OnPay is an excellent choice for small to mid-sized businesses looking for an affordable, easy-to-use payroll and HR solution. Its transparent pricing and comprehensive features make it ideal for companies in need of straightforward payroll management and basic HR support. However, larger businesses or those with advanced HR requirements may find it limiting.
6. Homebase
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Homebase Payroll is a simple payroll tool for small businesses. It automatically calculates pay, including overtime and taxes, and handles tax forms like W-2s. You can run payroll quickly, even the next day, and manage everything from a mobile app. This saves time, reduces errors, and helps businesses stay compliant with the law.
Key Features
- Simplified Scheduling
- Accurate Time Tracking
- Streamlined Payroll
- Effective Team Communication
- Comprehensive Management Tools
| Pros | Cons |
| User-friendly interface | Limited advanced features in lower-tier plans |
| Comprehensive scheduling and time tracking | Occasional technical glitches |
| Payroll integration | Customer support responsiveness issues |
| Team communication features | Pricing structure (per location, paid add-ons) |
| Mobile accessibility | Integration limitations |
Biggest Takeaway: Homebase is a great solution for small businesses looking to simplify scheduling, time tracking, and team communication. It is particularly well-suited for businesses with hourly employees, such as restaurants, retail shops, and salons. However, companies with salaried workers or advanced payroll and HR needs may find it lacking compared to more comprehensive platforms.
How to Choose the Right Payroll Software for Your Restaurant
Selecting the right payroll software comes down to understanding your restaurant’s specific needs. Here’s a quick checklist to help guide your decision:
Restaurant Payroll Software Checklist
☐ Assess Your Needs:
- ☐ Do you experience high employee turnover?
- ☐ Do you have complex tip management needs (e.g., tip pooling, tip credits)?
- ☐ Are you concerned about compliance with labor laws and regulations?
- ☐ Do you have difficulty managing employee scheduling and time tracking?
- ☐ Do you struggle with accurate payroll calculations and tax filings?
☐ Budget & ROI:
- ☐ Have you determined a budget for payroll software? (Consider 2-3% of annual revenue as a benchmark.)
- ☐ Are you looking for a solution with a potential for quick ROI (within the first year)?
☐ Ease of Use:
- ☐ Does the software have an intuitive and user-friendly interface?
- ☐ Is it easy for staff with varying levels of tech proficiency to use?
- ☐ Does the software offer training resources and support?
☐ Integration:
- ☐ Does the software integrate seamlessly with your existing POS (Point of Sale) system?
- ☐ Does it integrate with other essential systems like time & attendance or accounting software?
☐ Compliance & Security:
- ☐ Does the software help you stay compliant with federal, state, and local labor laws (e.g., wage and hour, tax regulations)?
- ☐ Does it offer robust security features to protect sensitive employee data (e.g., encryption, access controls)?
- ☐ Does it offer features for accurate tax filing and reporting?
How to Use This Checklist:
Simply check the boxes that apply to your restaurant's needs and preferences. This will help you narrow down your options and choose the best payroll software for your business.
For detailed reviews and comparisons, explore these helpful resources:
Take Control of Your Restaurant Payroll in 2025
Running a restaurant is no small feat, especially when it comes to managing payroll and compliance. But with the right payroll software, you can automate these processes, reduce errors, and focus more on delivering a great dining experience. At Lift HCM, we specialize in helping restaurants streamline payroll operations with solutions tailored to your unique needs.
Ready to take the next step? Contact Lift HCM for personalized advice and learn how our tailored solutions can help you easily manage payroll.
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