Free Payroll Tool
See what your payroll provider really charges
Most providers hide per-run and add-on fees. Audit your real cost per employee in about 30 seconds, free.
Run the Payroll Fee Auditor →Blog · Payroll Management · Childcare
Childcare Centers & Preschools: Payroll Software vs. Managed Payroll Service (2026)
Payroll software gives a childcare center the fields; managed payroll gives it someone accountable for filling them correctly, which for childcare centers means licensing-tied payroll records, subsidy payment coordination and part-time variable-hour staff configured against the rules cited here rather than left at defaults. BEG: $45 per employee per month inside the payroll software you already use, live in 3 to 5 days.
What software leaves to a childcare center to get right
Since the 1972 FLSA amendments, preschools and daycare centers are covered enterprises regardless of annual dollar volume and whether public, private, for profit or nonprofit. Every nonexempt employee must be paid at least $7.25 per hour for all hours worked and overtime after 40 hours in each workweek, not after 80 hours in two weeks.
Bona fide preschool and kindergarten teachers may be exempt from minimum wage and overtime as professionals when their primary duty is teaching, under the same conditions as elementary school teachers. Preschool employees whose primary duty is caring for the physical needs of the children would ordinarily not meet the teacher exemption.
The honest comparison
Software at roughly $40 to $150 a month plus $5 to $12 per employee handles a single-state, all-W-2, hourly-and-salary payroll well, and the customer owns every configuration decision, every deposit and every notice. Managed payroll at $45 per employee per month, with no monthly minimum, owns the configuration, the deposits, the filings and the corrections. For childcare centers the deciding question is who documents the exemption status of lead teachers and assistant teachers and who rebuilds the pay codes when the rule changes.
The rules behind this page, with sources
General information, not legal advice. Every rule below was read on the agency page linked next to it.
- Since the 1972 FLSA amendments, preschools and daycare centers are covered enterprises regardless of annual dollar volume and whether public, private, for profit or nonprofit. Every nonexempt employee must be paid at least $7.25 per hour for all hours worked and overtime after 40 hours in each workweek, not after 80 hours in two weeks. [DOL Fact Sheet #46]
- Bona fide preschool and kindergarten teachers may be exempt from minimum wage and overtime as professionals when their primary duty is teaching, under the same conditions as elementary school teachers. Preschool employees whose primary duty is caring for the physical needs of the children would ordinarily not meet the teacher exemption. [DOL Fact Sheet #46]
Read the full guide to fully managed versus self-service payroll, and the rest of the childcare center payroll library.
Managed Payroll, Handled.
BEG manages payroll at $45 per employee per month, all-inclusive. Get an instant cost comparison for your business.
Frequently Asked Questions
What does payroll software get wrong for childcare centers?
Since the 1972 FLSA amendments, preschools and daycare centers are covered enterprises regardless of annual dollar volume and whether public, private, for profit or nonprofit. Every nonexempt employee must be paid at least $7.25 per hour for all hours worked and overtime after 40 hours in each workweek, not after 80 hours in two weeks.
When is software the right answer for a childcare center?
A single state, all W-2, hourly and salary pay, no licensing-tied payroll records, and under about 20 employees, where software's lower per-employee cost outweighs what a managed service adds.
What does managed payroll cost for a childcare center?
$45 per employee per month, all-inclusive, inside the payroll software you already use, with no monthly minimum. Licensing-tied payroll records, subsidy payment coordination and part-time variable-hour staff are configured at setup, not billed as add-ons.
Related Resources
Anthony leads payroll solutions at Business Executive Group, a national managed payroll firm serving businesses across industries including Childcare Centers & Preschools. BEG manages payroll at $45 PEPM, all-inclusive, with deep expertise in compliance, multi-state filing, and industry-specific payroll requirements. Get instant pricing at beghr.com.
Authoritative source: U.S. Department of Labor: Wage and Hour Division
From the blog