Tes and Armstrong Watson Partner to Simplify Complex School Payroll and Pensions

Education technology provider Tes and payroll specialist Armstrong Watson have launched a strategic partnership to provide enhanced payroll and pension support for schools and Multi-Academy Trusts in England. The collaboration integrates specialist compliance expertise into the EduPay platform to help finance leaders navigate volatile pension contribution rates and complex teacher pay funding requirements.

What was announced

The partnership introduces two new service tiers to Tes’ existing EduPay platform, which currently processes more than 130,000 payslips every month. These new offerings, "Payroll Advanced" and "Payroll Complete," are designed to bridge the gap between automated software and the manual oversight required to manage complex education-sector contracts and pension schemes.

The launch coincides with significant shifts in school financial obligations. In April 2026, average Local Government Pension Scheme (LGPS) employer contribution rates dropped from 21.5% to 16.5%, though individual rates vary significantly between funds. Furthermore, LGPS savings are currently being used to fund the 3.5% teacher pay award for the 2026-27 period. With Teachers’ Pension Scheme (TPS) employer contributions also set for reduction in April 2027 alongside changes to school funding, the partnership aims to provide the technical expertise necessary to audit these fluctuating costs.

Under the new structure, Payroll Advanced allows schools to maintain internal control of their payroll while gaining access to Armstrong Watson’s specialists for complex calculations, legislative updates, and audit readiness. Payroll Complete offers a fully managed, end-to-end outsourced service, including BACS processing and comprehensive pensions administration. These join the existing Payroll and Payroll Plus tiers to provide a four-level service model tailored to the specific administrative intensity of term-time-only contracts and varied pay scales.

"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."

Karen Thomson, Partner & Head of Payroll, Armstrong Watson

The companies involved

Tes is a global technology company dedicated to the education sector. It provides a wide range of digital solutions designed to support school leaders, teachers, and staff, with a particular focus on recruitment, classroom resources, and financial management through its EduPay software. The company operates as a central hub for the teaching profession, combining software-as-a-service (SaaS) tools with professional development and news for educators worldwide.

Armstrong Watson is a prominent UK-based firm specialising in payroll, pensions administration, and compliance support. As a leader in the professional services market, the firm provides accountancy and advisory services to a broad client base, with a dedicated focus on the complexities of the UK’s regulatory environment. By partnering with Tes, Armstrong Watson brings its technical depth in pension rules and legislative compliance to the EdTech space, moving beyond traditional accountancy to provide integrated managed services for the public and academy sectors.

What this means

This partnership highlights a growing trend in the fintech and payroll sectors: the shift from "software-only" solutions to "software-plus-service" models. In highly regulated verticals like education, automated platforms often struggle with the nuanced interpretation of pension eligibility and shifting government funding rules. By embedding Armstrong Watson’s human expertise into the EduPay ecosystem, Tes is addressing a critical liability gap for Multi-Academy Trusts.

The move puts pressure on generalist payroll providers who may lack the specific expertise to handle the dual complexities of LGPS and TPS. As school budgets face increased scrutiny due to pay award changes, the market is likely to see further consolidation between SaaS providers and specialist consultancies to mitigate the high stakes of incorrect pension enrolment and financial non-compliance.