Tes expands EduPay with Armstrong Watson partnership

Tes has partnered with Armstrong Watson to expand its EduPay payroll service for schools in England, adding two new service tiers to a platform that processes more than 130,000 payslips a month.

The partnership introduces Payroll Advanced and Payroll Complete, extending support for schools, academies and Multi-Academy Trusts that use EduPay for payroll administration. The new options are intended to give organisations a choice between specialist support for internal teams and a fully managed payroll and pensions service.

The expansion comes as school finance and payroll teams deal with changes to pension contribution rates and their effect on budgets. Average Local Government Pension Scheme employer contribution rates fell from 21.5% to 16.5% in April 2026, although rates still vary by employer, including within the same fund.

That variation means schools and trusts must apply the correct rates to staff and assess what the changes mean for their own costs. At the same time, Local Government Pension Scheme savings are being counted towards funding the 3.5% teacher pay award for 2026-27 in England, even though the level of savings differs between institutions.

Schools are also preparing for further changes to the Teachers' Pension Scheme. Employer contribution rates are due to fall from April 2027, but the reduction will be accompanied by lower school funding, adding another layer to budget planning for finance leaders.

Service expansion

Tes already offers two payroll services through EduPay. Payroll provides access to the software, while Payroll Plus adds technical and pensions support.

The new tiers sit above those products. Payroll Advanced is designed for schools that want to retain control of payroll processing while drawing on specialist support for complex calculations, pensions administration, compliance, validation, audit readiness, legislative updates, year-end work and technical assistance.

Payroll Complete offers a fully managed service covering end-to-end payroll, BACS processing and pensions administration, alongside the support included in Payroll Advanced. It is aimed at schools with differing internal resources, from teams with experienced payroll staff to those seeking to reduce reliance on a single specialist or outsource the monthly pay run entirely.

The arrangement combines Tes software with Armstrong Watson's payroll and pensions expertise, with a focus on helping schools address errors and discrepancies when rules change or payroll scenarios become more complex.

One area of risk for schools and trusts is pensions enrolment. Questions over Teachers' Pension Scheme eligibility for trust chief executives and central staff have highlighted the potential consequences of incorrect enrolment, including possible effects on retirement benefits and employer liabilities.

Sector pressures

Payroll administration in education differs from many other sectors, with varied pay scales, term-time-only contracts, and the need to manage both Teachers' Pension Scheme and Local Government Pension Scheme requirements. Those factors have increased the need for specialist support as rules and contribution levels change.

Neil Robinson, Chief Revenue Officer at Tes, said schools had been asking for more support than software alone can provide.

"Schools and trusts tell us they need more than payroll software. They need people they can turn to when a payroll or pension query gets complicated, extra support when their team is stretched, and help making sure staff records are right," Robinson said.

He added: "We built this partnership with Armstrong Watson in response to those conversations, giving EduPay customers access to specialist support or a fully managed service, depending on where they need the help."

Karen Thomson, Partner and Head of Payroll at Armstrong Watson, said the sector's payroll demands were unusually complex.

"Payroll in the education sector is uniquely complex, driven by varied pay scales, term-time-only contracts, and the administrative intensity of TPS and LGPS. Our goal is to help schools and trusts reduce risk, strengthen compliance and gain greater confidence in payroll delivery. Whether customers need specialist payroll and pensions expertise or a fully managed outsourced service, this partnership provides a solution that matches their needs," Thomson said.

Tes said EduPay is built specifically for education payroll, and that the service expansion reflects demand from schools and trusts for more specialist support around payroll, pensions and compliance.