Subscription billing for HR tech

Per-employee-per-month billing for HR software, with headcount that changes every month

How HR, payroll and workforce platforms bill per-employee-per-month pricing in Bunny — monthly headcount updates, committed minimums, tiered rates, module add-ons and annual contracts on one subscription.

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What makes subscription billing different for HR and workforce software

Payroll, benefits, people-ops and workforce platforms priced per employee per month, where headcount moves every month and the price has to follow it.

  • Headcount is the quantity, and it moves

    Employees join and leave every month. The invoice has to reflect the real count, or a contractually agreed count, and finance has to be able to explain the difference.

  • Minimums protect revenue; true-ups capture growth

    Most PEPM contracts have a committed minimum employee count with a per-employee rate above it. The billing system has to bill the greater of the two, every period.

  • Modules at their own rates

    Base HRIS at one PEPM rate, payroll at another, benefits admin at a third. Each module has its own price, sometimes its own tier table, all on one invoice.

  • Annual contracts, monthly variability

    The customer signed for a year, but the amount changes monthly. Revenue recognition and reporting have to handle a fixed term with variable consideration.

How Bunny handles subscription billing for HR and workforce software

  1. 01

    Employee count as a live quantity

    The employee count is the quantity on a recurring per-employee charge. Update it from your product through Bunny's API each period, or report active employees as usage, and the invoice reflects it.

    Per-seat pricing
  2. 02

    Minimums with per-employee overage

    A committed minimum is a recurring charge; employees above it are billed at the contracted rate, so the invoice is always the greater of minimum or actual.

    Minimum commitments
  3. 03

    Tiered and volume PEPM rates

    Per-employee rates that decrease with headcount are configured as tiered or volume pricing in the catalog and applied automatically as the count grows.

    Volume pricing
  4. 04

    Modules as add-on charges

    Payroll, benefits, time and performance modules are add-on charges with their own PEPM rates, added to the base subscription and co-termed with it.

    Co-terming
  5. 05

    Advance or arrears billing

    Bill the committed minimum in advance and the true-up in arrears, or bill actual headcount in arrears — the schedule is configured per charge.

    Advance vs arrears
  6. 06

    Revenue recognition on variable amounts

    Recurring minimums are recognised ratably over the term; per-employee variable charges are recognised in the period billed; the schedule adjusts with the quantity.

    Revenue recognition for HR tech

The number on the invoice is the number of people

PEPM pricing is simple to explain and awkward to bill, because the quantity is owned by the customer’s HR events, not by the vendor’s sales team. A billing platform designed around fixed seat counts set at signature will drift from reality within a month.

Bunny separates the contract (rate, minimum, term, modules) from the quantity (this month’s employees). The contract comes from the quote; the quantity comes from your product through the API; the invoice is the rating of one against the other. That also means the renewal starts from the real current headcount rather than the number signed a year ago.

Subscription billing for other industries

The same workflow, written up for other kinds of B2B SaaS. Browse all industries.

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FAQ

Frequently asked questions

How does Bunny bill PEPM when headcount changes monthly?
The employee count is a quantity on the subscription's recurring charge. Your product updates it through the API each period, or reports active employees as usage, and Bunny bills the count at the contracted rate — with any committed minimum applied.
Can we bill a committed minimum plus overage per employee?
Yes. The minimum is a recurring charge on the subscription and employees above it are rated at the per-employee price, so the customer pays the greater of the two each period.
Can payroll and benefits modules have different per-employee rates?
Yes. Each module is its own charge or add-on plan with its own PEPM rate and tiers, billed on the same invoice and co-termed with the base subscription.
Do we have to bill in advance or in arrears?
Either, per charge. A common pattern is the committed minimum billed in advance and the headcount true-up in arrears, on the same invoice schedule.