Paycom Software, Inc. provides a comprehensive, cloud-based HCM solution delivered as Software-as-a-Service (SaaS).
The company provides functionality and data analytics that businesses need to manage the complete employment lifecycle, from recruitment to retirement. The company’s solution requires virtually no customization and is based on a core system of record maintained in a single database for all HCM functions, including payroll, talent acquisition, talent management, human resources (HR...
Paycom Software, Inc. provides a comprehensive, cloud-based HCM solution delivered as Software-as-a-Service (SaaS).
The company provides functionality and data analytics that businesses need to manage the complete employment lifecycle, from recruitment to retirement. The company’s solution requires virtually no customization and is based on a core system of record maintained in a single database for all HCM functions, including payroll, talent acquisition, talent management, human resources (HR) management and time and labor management applications. The company’s user-friendly software allows for easy adoption of its solution by employees, enabling self-management of their HCM activities in the cloud, which reduces the administrative burden on employers and increases employee productivity.
The company’s solution allows clients to automate decisions and time-consuming HR and payroll tasks, freeing them up to focus on strategic items, such as employee engagement and workforce planning. Additionally, the company’s solution maintains data integrity for accurate, actionable and real-time analytics and business intelligence and helps clients minimize the risks of compliance errors due to inaccurate or missing information. The company delivers feature-rich applications while maintaining excellence in information security, data privacy, business continuity, and quality management standards, as evidenced by its International Organization for Standardization (ISO) certifications.
The company sells its solution directly through its internally trained, client-focused and highly skilled sales force based in offices across the United States. As a part of its client retention effort, a specialist within a dedicated team is assigned to each client to provide differentiated, personalized service. The company has approximately 37,500 clients.
The Paycom Solution
The company offers an end-to-end SaaS HCM solution that provides its clients and their employees with immediate access to accurate and secure information and analytics at any time from any location where internet service is available.
The company’s solution offers functionality that manages the entire employment lifecycle for employers and employees, from recruitment to retirement. The company’s user-friendly applications streamline client processes and provide clients and their employees with the ability to directly access and manage administrative processes, including applications that identify candidates, on-board employees, manage time and labor, administer payroll deductions and benefits, manage performance, terminate employees and administer post-termination health benefits, such as COBRA. The company’s solution allows clients to automate numerous decisions and tasks from onboarding to offboarding, including payroll, position changes and other processes. The widespread employee usage of its applications further integrates its solution into the administrative processes of its clients. The company’s solution also has the advantage of being built in-house by its software developers, thereby minimizing data integrity issues across applications.
Core System of Record
The company’s solution is based on a core system of record that contains payroll and HR information in one convenient database. This core system of record enables the company’s clients to input employee data one time and enjoy seamless functionality across its applications. The company’s core system of record helps clients minimize the risk of compliance errors due to inaccurate or missing information that results from maintaining multiple databases. Through accurate tracking and management of employee payroll and other HR data, such information can be compiled for comprehensive and consistent reporting for the company’s clients.
Data Analytics and Business Intelligence
The company’s solution’s core system of record allows clients to strategically analyze comprehensive and accurate employee information to make informed business decisions based upon actionable, real-time analytics provided through its client dashboard. This functionality allows the company’s clients to operate with a more complete and accurate picture of their organization, as its solution’s embedded analytics capture the content and context of everyday business events, facilitating fast and informed decision-making from any location. The company’s industry-first employee usage management analytics tool, Direct Data Exchange (DDX), provides employers insights into efficiencies gained through employee usage of HR technology and generates a real-time estimate of the savings realized from that usage. Through the company’s employee self-service technology, employees can view real-time HR information, including pay stubs, payroll tax filing forms and benefits information, as well as manage their schedules and vacation time and update contact information. Employees can even do their own payroll with the company’s industry-first Beti technology. The company’s mobile app makes it easier for employees to access their self-service information. The company’s app has fingerprint and facial recognition capabilities, aiding employers in their efforts to engage technology-dependent workers. The company’s system also allows employers to engage their workforce through learning management courses and training paths, surveys, and performance goals and reviews.
To further enhance the effectiveness of management throughout its clients’ organizations, the company also offers easy to use software with Manager on-the-Go. Built within the company’s mobile app, this tool allows for 24/7 accessibility to essential manager-side functionality, giving supervisors and managers the ability to perform a variety of tasks — anytime, anywhere.
In addition to its self-service, app-based functionality, the company provides its clients with a strategy to drive usage among their employees. This strategy includes training clients’ employees how to use the Paycom app during implementation and providing additional training from the company’s client relations representatives (CRRs). Allowing employees to make changes directly to the company’s database creates efficiencies for both the employer and employee. Employees have little tolerance for complexity, and with the company’s solution, employees have become accustomed to having a direct relationship with their HR data. This relationship is directly correlated with the company’s single-database that is key to increasing usage. The company’s strategy to promote employee usage of the Paycom system elevates HR personnel to focus on the human element of their jobs, creating a more positive culture and giving HR personnel more time to engage with their employees.
Personalized Support Provided by Trained Personnel
The company’s applications are supported by one-on-one personal assistance from trained specialists. Service specialists are assigned to specific clients and are trained across all of the company’s applications, ensuring they provide comprehensive, expert-level service. The company’s Quality Management System is ISO 9001:2015 certified on the basis of its quality and consistency. The company strives to provide its clients with high levels of service and support to ensure their continued use of its solution for all of their HCM needs.
Software-as-a-Service Delivery Model
The company’s SaaS delivery model allows clients with geographically dispersed and mobile workforces to operate more efficiently, and allows these clients to implement, access and use its client-oriented internet solution on demand and remotely through standard web browsers, smart phones, tablets and other web-enabled devices.
The company’s cloud-based architecture allows its solution to be implemented remotely with minimal client interaction. Updates, such as software enhancements and newly developed applications can be deployed without client interaction, disruption or involvement, allowing the company’s clients to make a smaller investment in hardware, personnel, implementation time and consulting. Additionally, the company owns and maintains all of the infrastructure technology to host its solution and to maximize system availability for clients.
The company’s target client size is organizations with 50 to 10,000 or more employees. The company’s clients are able to use the same solution while their businesses grow by deploying applications as needed in real-time.
Early investments in the company’s proprietary, cloud-based architecture enable it to develop and deploy applications in a timely and cost-effective manner. The company has also chosen to base its research and development team in Oklahoma and Texas.
Strategy
The company’s strategy is to continue to establish its solution as the HCM industry standard by continuing to leverage its sales force productivity, penetrating existing markets and expanding into new markets. The company intends to continue to increase its domestic sales capacity and expand its offering to additional international markets. The company will also execute its strategy for growth by targeting large clients and strengthening and extending its solution. The key elements of the company’s strategy are to penetrate existing markets; enlarge its existing client relationships; expand into new markets; target large clients; and maintain its leadership in innovation by strengthening and extending its solution
Applications and Tools
The company’s HCM solution offers a full suite of applications and tools that generally fall within the following categories: payroll, talent acquisition, talent management, HR management and time and labor management.
With Global HCM, a number of the company’s HCM applications and tools are vailable in 15 languages and dialects and are accessible to users in more than 190 countries. The company also offers native payroll in Canada, Mexico, the United Kingdom and Ireland, and intend to add native payroll in other countries.
Payroll
Beti: Beti (Better Employee Transaction Interface) is an industry-first technology that further automates and streamlines the payroll process by empowering employees to do their own payroll, which increases efficiencies and reduces errors. Employees already manage all other components of their paychecks, including timecards, expenses, PTO requests and benefits; they have the convenience within Paycom to process their own payroll, too. By guiding employees to access, view, manage, troubleshoot and approve their paycheck before payroll is submitted, HR can focus on more strategic endeavors.
Payroll and Payroll Tax Management: The company’s payroll application is the foundation of its solution, and all its clients are required to utilize this application to access its other applications. It is automatically updated with changes in employee information and offers other time-saving functionality, such as batch editing and effective dating. Enhanced payroll functionality allows clients to automate and delegate payroll functions to accelerate the processes, giving clients repeatable, reliable payroll processing with additional controls. The company’s payroll application allows clients to configure the services to fit their specific needs. It can be accessed at any time to make changes, run payroll and generate custom reports. The company’s payroll tax management tool helps clients handle their payroll taxes, deposits, regulatory correspondence and amendments, as well as assists with penalty and interest disputes. With this tool, Paycom also debits clients’ payroll taxes, deposits them on their due date and submits clients’ filings.
Vault Visa Payroll Card: The Vault Visa Payroll Card gives employees the financial convenience of allowing them to deposit all or a portion of their wages on a secure pay card usable with mobile wallets like Apple Pay, Google Pay and Samsung Pay. In certain circumstances, Vault card users also can have access to their pay up to two days earlier for greater financial flexibility. For clients, it minimizes the inconvenience of paper-based payroll and helps reduce check fraud through secure digital funding.
Everyday: The company’s daily payroll service, Everyday, allows employees to receive daily wages on a Vault Visa Payroll Card at no cost to the employees. This service provides employees greater financial flexibility and transparency to better meet life’s demands. It also provides employers a competitive edge in hiring and retaining employees with a benefit today’s employees want. Everyday is fully automated, calculating and withholding taxes, benefits and deductions first to protect against overpayment and help ensure compliance.
Paycom Pay: Paycom Pay eliminates the tedious, risky job of check reconciliation by issuing checks to the company’s clients’ employees that clear from a Paycom bank account, thereby reducing the number of transactions on a client’s general ledger and simplifying bank statement balancing.
Client Action Center: Client Action Center makes it easier for payroll administrators to act on banking and tax-related information. Clients receive a comprehensive view of the data they need to make informed, accurate decisions — all centralized in one intuitive dashboard. With the Paycom mobile app, they can access quick views of wires, tax accounts and access to specialists for assistance.
Expense Management: The company’s expense management application eliminates the manual, paper-based processes associated with employee expense reimbursement and allows employers to control and monitor expenses by setting clearly defined rules and parameters for employee reimbursement. Employees can upload or email photos of receipts for reimbursement and expenses are automatically parsed when submitted. The company’s mileage tracker feature allows employers to more accurately track, log and manage employees’ mileage reimbursements that are then automatically updated within its expense management application. Employees can then access an expense dashboard where they can view the status of their submitted expenses through Employee Self-Service. Expenses seamlessly flow through virtual approvals to payroll, and the company’s application provides proper allocation of expenses to the general ledger, reducing manual work for accounting personnel. Organizations gain audit-ready reporting, which is critical when a client needs to know the important attributes of the expense approval process.
Garnishment Administration: The company’s garnishment administration application mitigates the risk of penalties and lawsuits from employees and agencies, allowing clients to handle communications with garnishment payees and agencies, as well as calculate and track garnishment payments.
GL Concierge: The company’s GL concierge application offers organizations more control and transparency into their payroll general ledger and gives finance professionals intuitive reporting, enriched audit trails, customizable file layouts and real-time alerts. Clients of all sizes can use a wide variety of general ledger maps along with an action item alert system that improves the dynamics of their daily operations. With this simplified process, accounting departments can generate mapped GL reports for direct import into various accounting software packages.
Talent Acquisition
Applicant Tracking: The company’s applicant tracking application simplifies the recruiting processes needed to hire the most qualified employees. By using its comprehensive software, the company’s clients can move candidates from the application process through new employee onboarding without re-keying data. Organizations can maintain and easily access a list of potential employees from a talent pool with real-time candidate, recruiter and manager retrieval while eliminating manual redundancies. Clients can also distribute job openings and reach a wider candidate audience with tools to automatically post jobs to their organization’s website, career sites and online job boards. The application’s enhanced career site analytics reveal which job boards and marketing efforts produce the best return on investment. It not only sends candidates automated job alerts to notify them of a client’s newly posted positions but also allows them to provide their availability up front to discuss potential job opportunities, thereby saving a step for recruiters.
Enhanced Background Checks: The company’s background check application helps clients easily screen prospective new hires or employees. Employers can choose the specific service or package of services desired for each individual, including verification of education, employment, driving history, criminal history, and drug and health screening, among others.
Onboarding: The company’s onboarding application streamlines the hiring processes for employees of its clients by creating online checklists of tasks to be assigned to an employee or group of employees. This process can begin even before a new hire’s first day on the job, helping the new hire be more productive on their first day.
E-Verify: By pairing electronic signature verification with online storage and analytics, the company’s E-Verify application automates employment verification and streamlines administration, reducing its clients’ exposure to audits and penalties that could result from I-9 violations.
Tax Credits: The company’s tax credits application helps employers process and calculate the available federal tax credits associated with hiring employees who meet various qualifications, ensuring organizations opting into this service receive their share of government-appropriated funds. This application also prescreens candidates to determine who is eligible for tax credits.
Talent Management
Employee Self-Service: Available in English or Spanish, the company’s Employee Self-Service application improves employee engagement by empowering employees to self-manage certain transactions, obtain quick answers to frequent payroll and HR questions, access their pay history, view performance goals and reviews, and view total compensation reports that show their compensation and benefits package. Benefits information and paid time-off accruals also give employees the ability to make informed decisions regarding their benefit selections and time-off requests. Employees can access the company’s self-service software through any device with an internet connection or by downloading the Paycom app on the Google Play store and the App Store online store.
Compensation Budgeting: The company’s compensation budgeting application provides compensation information, giving clients valuable workforce insight to help manage and formulate salary budgets and establish merit-based compensation increases that automatically upload new rates to payroll once the merit increases are set. Having payroll linked with performance reviews is instrumental for compensation budgeting, which rewards employees fairly while staying within budget.
Performance Management: The company’s performance management application allows employees to set performance goals and competencies for positions across an organization, helping align company goals with workforce goals. It also helps streamline the performance review process with online facilitation of the review process and links performance to pay.
Position Management: The company’s position management application provides customizable tools to categorize personnel, increasing consistency and organization companywide. The system ties job attributes to a specific position within the organization, not an individual employee, which frees up time to focus on people instead of antiquated processes.
Paycom Learning: The company’s learning management application delivers a smart, simple, data-driven experience that formalizes and standardizes its clients’ training processes, thereby allowing them to quickly adapt in an ever-changing business environment. It provides employees with anytime, anywhere access to a central knowledge base where they can access content, share expertise and measure their professional development progress, while its built-in video content creator allows subject-matter experts to share knowledge across the company by empowering them to create, upload and distribute engaging microlearning content quickly and easily. With performance evidence within Paycom Learning, the company’s clients can create a lesson tool that allows their employees to demonstrate knowledge and mastery of a specific skill to confirm they are truly grasping the course material. Managers or trainers then can provide direct input about the employee’s performance, creating a true feedback loop that promotes employee development. In addition to providing the ability to create and upload custom content, the company created and launched its own proprietary eLearning content. Paycom Learning clients have immediate access to a library of Paycom-created learning courses, which allows employers to educate their managers and employees quickly and consistently on foundational topics, such as workplace violence, discrimination and harassment prevention. Paycom content subscriptions are also available with hundreds of courses in English and Spanish. These courses are tailored to organizations across multiple industries.
HR Management
Manager on-the-Go: The company’s Manager on-the-Go tool gives supervisors and managers the ability to perform a variety of tasks, such as approving time-off requests and expense reimbursements — anytime, anywhere. It enhances usage patterns and the interactions within organizations among leaders and employees, while distributing the approval responsibilities more broadly, freeing HR personnel. This tool allows managers and supervisors to, among other things, view their team’s time-off calendar, edit and approve punch-change requests, manage employees’ schedules and respond to employee inquiries through Ask Here. Manager on-the-Go provides a seamless toggle between Manager on-the-Go and Employee Self-Service.
Direct Data Exchange: The company’s comprehensive management analytics tool gives employers insights into efficiencies gained through employee usage of HR technology and provides a real-time return on investment on that usage (based on findings by EY). Using its Direct Data Exchange (DDX) tool, employers can see the cost savings associated with changes made by employees, and can also drill down into specific aspects of the company’s software, including time and attendance, benefits, expenses, time-off requests, tax and payroll modifications, to determine exactly where additional savings can be achieved. This feature allows clients to see organizational employee usage trends arranged by their preferred time frame and total logins (filterable by individuals) to Employee Self-Service through any device.
Ask Here: The company’s Ask Here tool gives all client employees a direct line of communication to ask work-related questions of their company representatives and receive timely answers, all through the convenience of its self-service technology. Ask Here’s functionality promotes increased engagement by ensuring all inquiries are addressed, any required actions are taken and no follow-ups are required by the employee. This central repository for employee questions has a convenient dashboard, guided inquiry template, ability to attach documents and photos, and auto-saved responses for commonly asked questions.
Documents and Checklists: The company’s documents and checklists application is designed to manage employee files and allows employees to digitally sign and view company documents. Paycom securely stores client records to meet retention requirements and protect documents from unauthorized access and other disasters that can threaten businesses. Aside from expending fewer resources on paper, printing and file storage, its documents and checklists application protects sensitive information and documents by customizing user access levels. In addition, clients can assign checklists to employees for the completion of certain tasks associated with processes, such as onboarding and off-boarding.
Government and Compliance: The company’s government and compliance application helps clients reduce exposure to violations, audits and penalties with respect to the employment laws impacting their business, such as the Fair Labor Standards Act, Family Medical Leave Act, Equal Employment Opportunity Act, COBRA and other state and federal regulations. A single database keeps the company’s clients’ employee data consistent and enhances reporting capabilities by providing better accuracy and real-time insight.
Benefits Administration: The company’s benefits administration application allows clients to customize benefit plan setup, deduction amounts, enrollment dates and waiting periods. Employers are provided census and reconciliation reports to ensure they do not overpay for benefits. Employers can also update deduction amounts for all employees or groups of employees at once, which automatically updates all insurance carriers for any changes. This application also provides employees with online enrollment and helps educate them by allowing them to view per-pay-period deduction amounts and preview how these deductions would affect their take-home pay, driving better informed enrollment decisions for greater employee satisfaction. The company’s benefits to carrier functionality updates insurance carriers regarding benefit deduction amounts, address changes, termination of benefits and qualifying events. The company’s benefit enrollment service provides its clients with a dedicated coordinator to help make open enrollment even easier by developing tailored strategies and setting up plans and features within its benefits software offering. The coordinator helps reconcile enrollment and deductions to prepare the client for a successful first payroll of the new plan year.
COBRA Administration: The company’s COBRA administration application helps protect employers from COBRA violations and the associated fines and penalties by automatically initiating compliance measures upon entry of qualifying events into the application. In addition to sending required correspondence, this application tracks important dates, collects and reimburses premiums, and reports on all COBRA activity.
Personnel Action Forms and Performance Discussion Forms: The company’s personnel action forms (PAF) application helps its clients reduce the amount of time and paperwork required to make employee changes, such as pay rate, position and title changes, by allowing managers to complete and approve online personnel action forms, subject to necessary approvals from the HR department. This feature reduces errors, eliminates re-keying of data and automatically populates payroll with an effective date. Performance Discussion Forms, part of the company’s PAF tool, allows clients to manage employee conversations related to a variety of topics, including workplace behavior, development opportunities and paths toward a promotion.
Paycom Surveys: The company’s surveys application allows employers to conduct confidential email surveys of employees on workplace matters, providing employers with candid feedback that otherwise may go undisclosed. From exit interviews and benefits assessments to rate-the-boss questionnaires, this valuable information can be used to drive decisions and realize company goals. Clients can analyze results by the demographics of the workforce and compare how results change over time.
Retirement Reporting: The company’s retirement reporting tool simplifies the process of transferring sensitive employee data to clients’ retirement plan providers. It customizes, maps and automates plan reports to meet each provider’s unique specifications. After each payroll is processed and finalized, retirement plan reports are automatically created and delivered to the provider and the secure client inbox within 24 hours.
Report Center: The company’s easy-to-use reporting software allows clients to create custom reports on HR data within its software. Clients can filter through specifications according to their needs, use the advanced report writer to view visual data representations, such as charts and graphs, and build a detailed analysis of workforce and budget. Report Center provides insights on return on investment, overtime, payroll, job applications, salaries, compensation forecasting and more.
Enhanced ACA: The company’s ACA application provides clients with access to a dashboard that tracks employee count, employee status, health care plan affordability and ACA periods. Plus, it enables Paycom to file IRS Forms 1094/1095-B and/or -C. Clients using this application also have access to additional real-time compliance reports, alerts and historical data for audit trail purposes.
Clue: Clue helps businesses securely collect, track and manage the vaccination and testing data of their workforce. Clue allows employees to easily and quickly enter their vaccination or testing information and also provides automatic reminders and push notifications to help affected employees stay on top of any necessary testing. Clue’s dashboard provides a single, intuitive platform that stores relevant, up-to-date vaccine information and enables organizations to create customized reports to meet different business-specific needs.
Time and Labor Management
Time and Attendance: The company’s time and attendance application allows its clients to accurately and efficiently manage when, where and how employees report their hours worked. Clients can apply customized rules, use batch editing and use timecard management tools to manage complex time and attendance needs. Employees can clock in and out at their desks with web-based time clocks or by using finger scans, badge-swipe or other types of hardware terminals in a single or multi-clock environment. The company’s web time clock feature allows employees to clock in and out using their mobile device or any device with an internet connection, which automatically updates into the payroll application when approved, eliminating the need to manually calculate time sheets and re-key information into payroll systems.
Scheduling: The company’s scheduling application helps managers with employee scheduling through automated functionality that provides a seamless workflow with the payroll and time and attendance applications. This application allows clients to create and edit templates for different Schedule Groups. It also allows employees and managers access to their schedules at any time, and employees can approve, decline or swap their schedules and see what shifts are available for pickup. Email notifications are sent automatically to supervisors and employees when schedules are created, requests for shift exchanges are submitted or a shift change is approved or denied.
Time-Off Requests featuring GONE: The company’s time-off requests application automates and standardizes the time-off request process. GONE, an enhancement to time-off requests, automates time-off decision-making. It allows clients to set criteria to fairly and consistently auto-resolve requests, which helps employers remain adequately staffed. GONE facilitates faster decisions for employees and reduces the burden on managers and HR teams to handle disputes. After setup, decisions flow seamlessly and accurately into payroll. Managers can also view an online time-off calendar to easily monitor time-off requests. The company’s Employee Self-Service application allows employees to view the time off they have available, submit requests, view the status of requests and any manager comments, and view company holidays and blackout dates.
Labor Allocation: The company’s labor allocation application simplifies the process of setting up and tracking employee hours and wages based on different categories, such as job or location. This tool gives clients the ability to streamline pay rules and ensure accurate reporting from the moment their employees record their time.
Clients
The company serves a diverse payroll and HCM client base in terms of size and industry. The company has approximately 37,500 clients, or approximately 19,400 clients based on parent company grouping. The company stored data for over 7.0 million persons employed by its clients during the year ended December 31, 2024.
Many small to mid-sized companies can typically make the decision to adopt the company’s solution more quickly than larger companies, which results in a shorter sales cycle and more closely corresponds to the company’s target sales cycle of 30 to 90 days. As a result of the nature and size of its clientele, the company maintains a diversified client base and very low revenue concentration among its clients.
Competition
The company competes with companies such as Automatic Data Processing, Inc., Cornerstone OnDemand, Inc., Dayforce, Inc., Intuit, Inc., Insperity, Inc., Oracle Corporation, Paychex, Inc., Paylocity Holding Corporation, Paycor HCM, Inc., SAP SE, ServiceNow, Inc., Ultimate Kronos Group, Workday, Inc., and other international, national, regional, and local providers.
Sales and Marketing
The company generates client leads and demo requests, accelerate sales opportunities and build brand awareness through its marketing programs that target senior finance and HR executives, technology professionals and senior business leaders of companies that perform HCM functions in-house or outsource these functions to one of its competitors. The company’s marketing programs include:
Podcasts, webinars, blogs, white papers and infographics;
National and local television advertising campaigns, personalized direct mail campaigns, email campaigns, social and digital media campaigns, industry-specific advertising and tradeshow exhibiting; and
Search engine marketing methods that include site optimization and pay-per-click searches.
The company sells its solution exclusively through its captive sales force, substantially all of whom have a four-year college degree. The company typically recruits sales candidates who have sales experience in non-HCM industries or, with respect to candidates recruited directly from colleges and universities, who have demonstrated an aptitude for sales. The company’s sales force consist of field sales personnel, who are organized geographically, CRRs, who sell additional applications to existing clients, and its emerging markets representatives, who focus on businesses with fewer than 65 employees.
When a new client processes payroll with it for an entire month, the company’s sales representative receives a one-time commission based upon an estimate of future annual revenues from such client. Executive sales representatives receive a higher commission rate and base salary based upon both year and career-to-date realized sales.
In addition to managing client relationships, the company’s CRRs are focused on expanding the number of applications its clients purchase from it by introducing them to additional applications.
Technology, Operations and Security
Technology
The company’s multi-tenant architecture enables it to deliver its solution across its client base from a single platform, while securely partitioning access to its clients’ respective application data. Because a single version of the company’s solution is developed, supported and deployed across all of its clients, the Paycom solution is seamlessly scalable.
Operations
The company physically hosts its solution for its clients in three secure data center facilities located in Oklahoma and Texas. Each of these data centers is owned and managed by Paycom, and Paycom is the only tenant occupying the data centers. All of the company’s critical systems are fully redundant and backed up at regular intervals to these facilities, and backups are monitored for success and failure status daily. Client data is backed up in real-time among the three data centers. The company maintains redundant load-balanced internet lines serviced by multiple service providers to each data center, to ensure optimized client access to its solution and the clients’ stored data. The company’s server and database clusters are fully redundant to ensure continuous service in the event of a disk failure.
Physical security includes biometric and dedicated ID-oriented access control, redundant alarm systems and continuous camera monitoring by the company’s security guards. The data centers also have environmental monitoring and extensive environmental controls, such as heat and fire protection, moisture, temperature, and humidity sensors, backup power supply and exterior reinforced concrete walls.
To provide additional support for its operations, the company recently purchased a facility in Arizona that will serve as its fourth data center. The security and other features at this facility, which the company expects will be fully operational in mid-2025, will be similar to those at its existing data center facilities.
Security
The company maintains a formal and comprehensive security program designed to ensure the confidentiality, integrity and availability of its clients’ data.
Software Development
The company’s application development team works closely with its clients to enhance its existing application offerings and develop new applications. This process is led by experienced product managers, who oversee the evolution of their respective applications within a focused timeframe of innovation and cultivation in order to deliver the well-developed applications and enhancements desired by its clients. The company’s product managers are proactive in their approach to assigning development requests based on research, trends and user feedback. A key element of the company’s development process is the one-on-one personal interaction between clients and its service team, through whom its clients personally suggest new applications and features.
The company develops its solution from the ground up with its internal development and engineering teams. The company’s development and engineering teams conceive new applications and enhancements, review requests, schedule development in order of priority and subsequently develop the applications or enhancements. The company’s new applications and enhancements are independently reviewed by the quality assurance team, in accordance with its software development process, before being fully implemented. Enhancements to its applications are typically released on a monthly scheduled release date to coordinate the communication and release to its clients.
Client Service
The company is committed to providing client-centered service. For this reason, the company assigns each client a specialist within a dedicated team. This one-on-one service is a key part of the company’s client service model and helps to ensure it is delivering a differentiated solution and maintaining high client satisfaction. The primary elements of the company’s client service model include the following:
After electing to deploy its solution, a new client begins the company’s onboarding process with assistance from a team of new client setup specialists and the sales representative responsible for obtaining the client’s business. In addition, the company has a team oftransition specialists whose job it is to ensure that the process is performed smoothly, data is collected properly and all relevant employees are fully trained on the system. This team works closely with the client until the client is capable of managing the company’s solution independently, at which time responsibility for the client relationship is transferred to its dedicated CRRs and service specialists.
Dedicated Service Specialists
After completing the onboarding process, each client is assigned to a service specialist within a dedicated team. Clients can then contact their dedicated service specialist or a team member if any issues or questions arise. These specialists provide personalized service with a historical knowledge of the clients’ communicated business needs. In addition, the company’s CRRs proactively contact its clients to ensure satisfaction with its solution and introduce additional applications.
The company’s service specialists are trained across all of its applications to ensure that they can provide comprehensive, expert-level service. The company’s Quality Management System is ISO 9001:2015 certified and helps support its high client retention rate.
Government Regulation
As a result of its background screening application, Enhanced Background Checks, the company is subject to the Fair Credit Reporting Act and other federal and state background reporting laws.
The company is registered with the U.S. Treasury Department Financial Crimes Enforcement Network, and Paycom Canada, Inc. is a registered Money Service Business with the Financial Transactions and Reports Analysis Centre of Canada. In 2024, the Office of the Comptroller of Currency (the OCC) authorized it to open the Paycom National Trust Bank, National Association (the Paycom National Trust Bank), via a national trust bank charter pursuant to the National Bank Act. The Paycom National Trust Bank is the sole trustee of Paycom Client Trust, its grantor trust, which holds substantially all client payroll and related funds and is responsible for the oversight and management of those client funds. The Paycom National Trust Bank, and all its fiduciary activities, including the U.S. money movement it oversees and manages via Paycom Client Trust, are subject to comprehensive ongoing oversight and regulation by the OCC. In addition, the company’s U.S. money movement managed by the Paycom National Trust Bank is subject to the AML and reporting provisions of The Bank Secrecy Act of 1970, as amended by the USA Patriot Act of 2000 (the BSA). Ourmoney movement activities outside of the United States are subject to similar licensing and AML and reporting laws and requirements in the countries in which the company provides such services.
Seasonality
The company’s revenues are seasonal in nature. Generally, the company expects its first and fourth quarter revenues to be higher than other quarters during the year because payroll tax filing forms and ACA forms are typically processed in the first quarter, and unscheduled payroll runs (such as bonuses) for its clients are typically concentrated in the fourth quarter (year ended December 31, 2024).
History
Paycom Software, Inc., a Delaware corporation, was founded in 1998. The company was incorporated in 2013.
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