Talent Management
Applicant Tracking

The Hidden Cost of Your Free ATS

Published by in Applicant Tracking

Everyone loves saving money. Putting away extra cash feels like an accomplishment, for you or your business. But the idea of TANSTAAFL can stop people from going after the best value on the market: free or open source software.

Just about every free software in the world has some sort of catch. This isn’t just a concern in the business or HR worlds; every form of freeware should be given a second-look, be it an open source ATS or an alternative web browser. Big or small, these catches force the user to weigh the value of how much money they’re saving against whatever they’re really trading to use it.

Sounds a little dogmatic, but being informed is the first step to making a good decision. Not every catch is big enough to drive away users. Some are quite benign. It’s all about knowing what your trade-off is in exchange for the low cost of free.

Is free applicant tracking software really free? And even if it is, does that automatically make it a good deal? Let’s take a look.

Define “free”

When we refer to “free” software, what exactly are we saying? Free means different things to different people. Let’s look at a few examples.

  • Open source Software that has source code—the messy, complicated looking guts that make the program run—open and free to the public. That means anyone can install it and, with a little know-how, make changes to it. Open source is not, inherently, any more complicated than a paid installation. If you install it and leave it alone, it will run as-is, no coding required. But the downside is, if something goes wrong, unless you’ve managed to find one of the open source options that offer support (and, yes, a few do exist), you’re on your own fixing it. No helpdesk, no customer support, nada.
  • Free… for a while If I had a dollar for every time I thought I’d found free software, only to discover that it only offered a free trial, I’d have enough money to retire. Free trials are the “gotcha!” of the software world. Sometimes the trials can last for months or even years, but in the end, the price shows up.
  • Free forever, with limitations If it’s not a free trial, it’s a limited free version. Limited free software typically offers some (but not all) of the nice features you’d find with a paid version. Or you can access all the features but to a lesser extent, such as an ATS that only allows you to post two open positions online at a time or one that caps you at five users.
  • Free but be careful where you click The only way to run a good, free-forever, no-limitations software is to fill it to the brim with ads. Think of the free version of Pandora or Spotify. This is a much less common method of providing free HR software, but it still exists, and in your search for an inexpensive ATS, you may find one or two ad-based free programs. There’s no mechanical disadvantage to software full of ads, but it is annoying.
  • You just can’t give it away And then there’s the bottom-of-the-barrel. You’re not sure what the designers were thinking, but it definitely wasn’t how to make an effective program. This software might be cleverly marketed, but things that seem too good to be true typically are. The reason why this software is free is obvious: it’s terrible. This category often (though not exclusively) overlaps with open source.

Just because software with limitations, buts, and startup challenges exist does not mean that all free software is bad. Sometimes, the advantages will still hugely outweigh the disadvantages. But that doesn’t mean you can go skipping merrily through a fragrant field of free technology, picking every open source flower you see.

I just assume that that’s the field. It feels right.

Things to consider

Each of the above free software models presents us with pros and cons. Are the cons big enough to make us trash the pros? Are the pros enough to make up for the cons? Maybe. Maybe not. As always, knowing your business and carefully considering the unique needs and concerns you have will make all the difference in making the right choice.

Look at the upsides and downsides of each breed of free software below and think about the trade-offs you’re willing to make. In some cases, the trade-offs will be so slight that you may not even notice them. In other cases… well, just be glad you were warned before making a poor call!

On the downside

Hidden costs are a thing. They sneak up on you, waiting around the corner on dark nights, waiting to strike like the sneaky, money-sapping fiends they are. The costs can come in literal ways or in more figurative ways. Neither version is fun.

In the most literal sense, the free trial offers will get you when you least expect it. Many vendors take your credit card information before they’ll let you download their trial, and the less ethical may begin charging you without warning you that your trial has expired. In fairness, you probably had to click “agree” after reading a long list of rights and permissions, and you probably didn’t actually read it. No shame, but be aware of little tricks like these to avoid getting caught by surprise.

A less obvious way you can get nabbed by hidden costs is by overlooking the value of your time. Figure out what you need to do, determine how many hours a day it will take to do it, and then throw those calculations out the window because open source software is going to be a time suck. If you opt for open source, hopefully everything will be fine. But if it isn’t, you’re on your own.

If you want to customize and tailor your open source ATS to your business’s specifications, you’re going to need time and know-how. And, on the off chance that the code breaks or you encounter technical issues, there is no help desk to bail you out, so you’re going to have to invest your own time into fixing the problem. Even if you won’t personally be making the repairs, the fixing will eat up your IT team’s time, not to mention the training they’ll need just to understand the system well enough to fix it in the first place.

In the same way that you can buy a finished house or buy the land and supplies to build your own house, sooner or later you’re going to have to pay in time or money. High startup costs don’t always make a free initial download worth it.

But enough about open source. Limited software versions can prove problematic as well, for fairly obvious reasons. If the features you can’t access are the features you need, you’re in trouble. It’s not impossible, but only being able to post one or two job adverts at a time is very difficult for all but the smallest companies. Having a cap on potential recruits is even worse, since it limits your ability to sort candidates equally.

As for ad-based software, in some cases, the appearance of your software is very important. Any software that’s going to be regularly accessed by recruits and applicants probably calls for white-labelling, and having ads unrelated to your company will make you look bad.

But on the upside

Sometimes the limitations aren’t actually limitations at all.

Ask yourself what size your business is. Is it super-small? Are you below 100 employees? Below 50? Or way more? How fast is your company growing? How many hires can you expect in the coming year? If you’re a small business or are growing slowly, then there’s nothing wrong with a low cap on ATS users or hires. If you don’t intend to hire more than five people this year, there’s nothing wrong with a cap of three or four open positions at a time.

For those of us that have a lot of experience coding, or who have a large and dedicated (or just under-utilized and bored) IT team, open source software could be your best friend. The time investment is only a sacrifice when you don’t have enough time or manpower to spare.

The high level of customization offered by open source can also be a boon well worth the time investment. If you want a completely unique system, but you can’t afford bespoke software, a DIY open source edit could last you years in exchange for a few months of tweaking and prodding the code into shape.

If your applicants and clients will never see the software, there’s no problem with ads. If your staff can handle the minor annoyance of an occasional lightbox or banner ad, in-software advertising is a manageable trade-off for an otherwise solid free program.

Trials aren’t evil demons. They serve a purpose for those who are willing to shell out a little more for their software. If you don’t know what you want or are searching for a software that allows you to do something specific, trials are a good way to figure out if a software fit your needs.

In fact, trials and test-runs can help you identify those horrible software choices that are free because nobody would pay for them. In these cases, trials are your best friend.

Consider what you need, what you don’t need, and figure out what you don’t mind. The downsides may turn out to be quite manageable.

The bottom line

Paid software isn’t a feasible option for everyone. But, at the same time, free software isn’t for everyone, since free doesn’t always mean… well, you get it. Everything costs, in one way or another, sooner or later. You may pay in time, in effort, in money, in headaches.

The mission falls to you as an HR expert to know yourself, your team, and your business well enough to understand what your tech needs are. If, at the end of the day, the best deal is paying a little extra to get the software you really need, then that’s your best investment plan. But if you’ll be just as well-off dodging a few ads or using a limited system, then go for it. Every business is different.

Have you had problems with free applicant tracking software?

Have you implemented a free applicant tracking system? What kind of “free” was it? Did it end up working for you? Tell me all about it in the comments below and subscribe for more HR tech news and updates.

For more information on finding the right ATS for you (free, “free”, or otherwise), check out these articles:

  • What ATS Costs In case you were wondering what the not-free options were

Looking for Applicant Tracking software? Check out Capterra's list of the best Applicant Tracking software solutions.

About the Author

Halden Ingwersen

Halden Ingwersen

Halden Ingwersen is a former Capterra analyst.


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