I recently sat down with David Woodward, Chief Product and Technology Officer at Zellis, to discuss their acquisition of elementsuite and their evolving AI capabilities. As an analyst, I find this move particularly interesting for what it means in the market.
Zellis has long dominated the payroll landscape, processing payments for one in six workers across the UK and Ireland. Their acquisition of elementsuite adds a sophisticated HR and workforce management platform to their established payroll expertise. This combination creates a compelling solution worth examining if you manage complex HR operations.
Market Context
The HR technology market in the UK and Ireland has evolved, wth specialized providers focusing on the unique compliance requirements and workforce practices specific to these countries. While global players like Workday and SAP maintain a presence, locally-developed solutions that deeply understand the region’s complex tax regulations, employment laws, and business practices have captured significant market share.
Leading this regional specialist category are companies like IRIS Software Group (the market share leader), Zellis, MHR International, SD Worx, Access PeopleXD (formerly CoreHR), and CIPHR. These companies have built their solutions specifically around payroll, HR, and workforce requirements, often with decades of experience informing their development.
Zellis distinguishes itself through its deep focus on UK and Ireland-specific payroll and HR requirements, rather than trying to be a global generalist. This approach has proven effective, winning them business from over a third of the FTSE 100 companies. The elementsuite acquisition significantly expands Zellis’s capabilities beyond payroll into comprehensive HR, workforce management, and talent management, creating an end-to-end solution specifically designed for the complexities of UK and Ireland employment practices.
Key Technology Differentiators
During our briefing, David walked me through Zellis’s “AIR” platform (AI-enabled and Realtime) launched last autumn. I find their approach to AI particularly practical, focusing on solving real business problems rather than just adding buzzworthy features.
Their real-time payroll processing eliminates the familiar end-of-month panic that plagues many payroll teams. Instead of concentrating all calculations into a high-pressure monthly cycle, Zellis’s system continuously processes payroll data throughout the period, while intelligent anomaly detection automatically identifies potential issues before they affect payment accuracy. I’ve seen many attempts at modernizing payroll processes, but few address the workflow challenges as directly as this approach.
The AI elements impressed me with their practical applications. They’ve built intelligent document scanning to process UK tax forms like P45s (the tax document given when leaving a job) and new starter checklists, speeding up onboarding. Their intelligent payslips use AI to explain pay variations to employees — a clever solution that improves transparency while reducing HR queries.
What struck me most about the elementsuite acquisition was how both companies had already committed to AI innovation before joining forces. The elementsuite platform brings sophisticated natural language querying capabilities with role-based security guardrails built directly into the system architecture.
Users can ask business questions in plain English — but the platform automatically enforces data access boundaries based on the user’s role. Employees can only query their own personal data, managers can only access information about their direct teams, and HR users with broader permissions can analyze company-wide data, with each role prevented from seeing information they shouldn’t have access to.
David shared an impressive implementation where they developed an AI-powered safeguarding chatbot for a major food service organization. Employees can report workplace concerns through the chatbot, which automatically routes issues through a case management system — one of the most substantial and practical generative AI deployments I’ve seen in HR.
Zellis and Other Regional Providers
IRIS Software Group
Currently holding the largest market share in HR and payroll software, IRIS offers solutions particularly popular with accountants and business service providers. Where Zellis differentiates is through their enterprise-grade focus and deeper integration between HR and payroll systems, especially following the elementsuite acquisition.
MHR International
MHR’s iTrent platform competes directly with Zellis in the mid to large enterprise space. MHR won the CIPP‘s Software Product of the Year in 2023 (before Zellis took the crown in 2024). While MHR offers strong data analysis capabilities, Zellis’s AIR platform and new AI-powered capabilities following the elementsuite acquisition provide practical innovations that address specific workflow challenges.
SD Worx
This Belgian company maintains a significant presence and competes directly with Zellis for large enterprise clients. Zellis has demonstrated success in this competitive landscape, winning accounts from SD Worx. The expanded HR capabilities from elementsuite strengthen Zellis’s value proposition when compared to SD Worx’s offerings.
Access PeopleXD
Known for highly-rated payroll and HR software with strong automation features, Access PeopleXD (formerly CoreHR) serves notable clients like the University of Oxford and Cineworld. Zellis differentiates through their deep focus on AI innovation and their impressive market penetration (processing pay for one in six workers).
CIPHR
Offering cloud-based software combining HR and payroll needs, CIPHR competes in the mid-market segment. Zellis’s enterprise focus and comprehensive capabilities following the elementsuite acquisition position them strongly for larger, more complex organizational needs that extend beyond CIPHR’s typical customer profile.
Who Should Consider Zellis
Zellis has created a distinctive approach by combining deep regional expertise with practical AI innovation. Their solution makes the most sense for:
- Organizations with 1,000-15,000 employees
- Companies with significant frontline workforces in retail, hospitality, manufacturing, and service sectors
- Public sector organizations dealing with complex workforce requirements
- Multinational companies needing specialized solutions for their local operations
- Organizations ready to apply AI in practical ways to HR and payroll processes
Their client retention is impressive — 95% with an average 15-year relationship. This stability stands out and their client list includes major organizations like Boots, Aldi, Lloyds Banking Group, and numerous public sector entities — companies that make technology decisions carefully.
Brandon Hall Group™ POV
Zellis occupies a distinctive position in the HR technology market. They’ve established remarkable depth in meeting specific requirements while adding meaningful AI innovation that solves real business problems.
The elementsuite acquisition shifts their proposition from payroll leader to comprehensive HR technology provider. For organizations with complex payroll scenarios involving multiple legal entities, collective bargaining agreements, or specialized public sector requirements, Zellis’s combined solution addresses technical challenges that competitors with less regional focus often struggle to handle effectively.
What makes Zellis worth watching is how they’ve focused their innovation. Instead of trying to match global giants feature-for-feature, they’ve built specific capabilities that matter for their target market. Their AI implementation is remarkably practical — solving real problems like making payslips more understandable and enabling natural language queries with appropriate security guardrails.
In a competitive landscape where each vendor has carved out specific strengths — IRIS with its accounting integration, MHR with its data analytics, SD Worx with its European reach, Access PeopleXD with its automation, and CIPHR with its mid-market focus — Zellis has differentiated through enterprise-grade solutions with practical AI applications. For organizations with 1,000+ employees in the UK and Ireland, particularly those with complex payroll requirements and large frontline workforces, Zellis presents a compelling option that merits serious evaluation.
For more insights into HR and Learning strategy and technology providers, explore Brandon Hall Group™ research at institute.brandonhall.com.
