Gusto vs. Paychex Comparison: Comparing Two of Our Top HR Solutions

Gusto vs. Paychex

Who Do We Recommend Gusto For?

Gusto HR software is best suited for small and midsize businesses that want to streamline and optimize their payroll processes and other HR functions. This user-friendly platform can support employees and contractors, allowing employers to manage all their workers from one centralized location. Since it ensures precise and compliant payroll processing and offers additional HR tools, it’s an ideal choice for businesses focused on payroll excellence as a cornerstone of their HR operations. 

We think Gusto stands out because of the following factors: 

• Every Gusto plan includes full-service payroll, including W-2s and 1099s.
• Gusto can integrate with more than 155 third-party applications. 
• Gusto’s time-management and payroll features integrate seamlessly, ensuring accurate payments.

Gusto’s time-tracking features integrate directly with its payroll. Source: Gusto

Who Do We Recommend Paychex For?

Paychex is a versatile HR and payroll services provider that caters to a wide range of businesses, including in-office, hybrid and remote organizations. It’s not just an HR platform; you can partner with Paychex as an outsourcing solution, so it’s an excellent choice for SMBs seeking a flexible HR provider. Its services are particularly valuable for organizations that want to streamline payroll management, tax compliance, employee benefits administration and human resources tasks. 

The following factors make Paychex an excellent HR solution: 

• Paychex has many self-service features that help employees manage their HR functions.
• Paychex offers a cloud-based platform and intuitive mobile apps, which are excellent options for remote and off-site workers. 
• Paychex is available as a professional employer organization (PEO) or a human resources outsourcing (HRO) solution.

Gusto vs. Paychex

Pricing and Contracts

Gusto

• Gusto offers month-to-month contracts.
• Users can sign up for a one-month free trial.
• Add-on features like employee benefits, state tax registration and R&D tax credits are available. 

Gusto offers four preset HR plans with transparent pricing and contract terms. It charges a monthly base fee plus a per-employee rate per month. 

• Contractor Only: This plan is a great option for businesses that work with independent contractors. With a base fee of $35 per month, plus $6 per contractor per month, employers can access unlimited payroll, four-day direct deposit, 1099s and new-hire reporting. You can add international contractor payments, as well. 
• Simple: With a base fee of $40 per month, plus $6 per employee per month, employers gain access to hiring and onboarding tools, employee benefits administration, single-state payroll processing, self-service features, HR reporting, workforce management and integrations. 
• Plus: With a base fee of $80 per month, plus $12 per employee per month, employers gain access to everything in the Simple plan, plus advanced hiring features, time and project tracking, multistate payroll, direct deposit, PTO management, and performance management. You can add priority support for $8 per employee per month and time kiosks for $4 per user per month.  
• Premium: For custom pricing, employers gain access to everything in the Plus plan, plus insurance broker integration, full-service payroll migration and account setup, compliance alerts, a time kiosk, and priority customer support with a dedicated customer success manager. 

Gusto offers three employee plans and one contractor plan. Source: Gusto

Paychex 

• Paychex offers PEO and HRO plans.
• Employers aren’t locked into a long-term contract. Instead, you can cancel anytime with 30 days’ notice.
• Paychex plans are scalable; employers can add or remove products and features as their business grows.

Paychex offers three preset HR plans with mostly customized pricing. It charges a monthly base fee plus a per-employee rate per month. Here’s a breakdown of Paychex’s plans:

• Essentials: With a base fee of $39 per month, plus $5 per employee per month, employers gain access to employee onboarding, payroll processing, payroll tax administration, employee self-service features, and analytics and reporting. 
• Select: For custom pricing, employers gain access to everything in the Essentials plan, plus a learning management system.
• Select: For custom pricing, employers gain access to everything in the Select plan, plus background check services, an employee handbook builder, state unemployment insurance services, workers’ comp payment services and general ledger integrations. 
• Add-ons: All plans can pay to add features, including job-posting website integrations, recruiting and applicant tracking, document management, employee benefits, business insurance, time and attendance management, job costing, performance management, and voice assist integrations.

Winner: Gusto

We like that both vendors offer flexible contracts with a range of available features and add-ons. However, Gusto takes the win in this category. Paychex’s lowest-level plan is a bit less expensive than Gusto’s, but it’s not quite as comprehensive. And costs add up quickly when you tack on additional helpful features. We also like that Gusto has transparent online pricing for most of its plans and features, so employers can clearly see which plan will match their needs and budget. We also found Gusto’s one-month free trial to be a value-add; it’s unclear whether Paychex offers a free trial. 

HR Features

Gusto

Gusto’s HR features are tiered based on your service plan. Notable features include the following:

• Standard HR features: Gusto offers standard HR features for hiring and recruitment, onboarding, tracking time and attendance, administering employee benefits, and processing payroll. It also offers HR reporting, compliance alerts, employee surveys and performance management capabilities.
• Expanded HR features: Select plans can add contractor payments, state tax registration, R&D tax credits, time kiosks and priority support.
• Additional add-ons: Employers can access add-on benefits like health insurance, life and disability insurance, workers’ comp, retirement plans, and tax-advantaged benefits. 

Paychex 

Paychex plans are customized, ensuring businesses get the services they need. Notable features include the following: 

• Essential HR features: Paychex offers essential HR features like hiring and recruitment, background check services, mobile-friendly paperless onboarding, employee benefits administration, payroll processing, payroll tax administration, performance management, and HR alerts and reporting.
• Time and attendance features: Paychex offers comprehensive employee time and attendance features like employee scheduling, time tracking, leave management, GPS tracking and geofencing.
• HRO or PEO options: Paychex’s HR features are available via a standard HR platform, or you can seek additional assistance through its HRO or PEO plans. Either way, its features are scalable.

Employees can manage their benefits and HR functions via their Paychex Flex account. Source: Paychex

Winner: Paychex

Although both vendors offer essential HR features, we appreciate that Paychex offers more feature flexibility. Its customized plans allow employers to access as many HR features as needed. We also like that its features are available via HRO or PEO services. The PEO co-employment model takes many HR responsibilities off the employer’s shoulders, which can benefit many small businesses. We were pleased that Paychex offers other business services, including workers’ compensation, employee scheduling and business insurance.

Payroll

Gusto 

Gusto’s comprehensive payroll offerings include the following: 

• Multistate payroll processing: Gusto offers multistate payroll processing with unlimited monthly payrolls and multiple pay rates and schedules.
• Tax services: Gusto offers state tax registration, W-2s and 1099s, tax filings, and payments.
• AutoPilot: Employers can use Gusto’s AutoPilot to automate payroll processing.
• Direct deposit: Gusto offers next-day, two-day and four-day direct deposit.

Paychex 

Paychex’s payroll processing services include the following: 

• Standard payroll processing: Paychex offers standard payroll processing and tax administration services.
• Device flexibility: Payroll can be completed online from a desktop or mobile device.
• Transfer payroll data: Employers can use Paychex’s general ledger service to easily transfer payroll data to their accounting software. 

Winner: Gusto

This was a close call because both vendors offer comprehensive payroll and payroll tax administration features. However, payroll is Gusto’s best feature, giving it the edge in this category. We like that the vendor includes comprehensive payroll features with even its most basic plan. We also appreciate that it offers domestic and international contractor payments. This isn’t something many competitors offer, but it’s ideal for employers with diverse or global workers. 

Usability

Most of the software we review is user-friendly, and these two vendors are no exception. Here’s how Gusto and Paychex compare in terms of usability. 

Gusto

Gusto’s software and interface are easily navigable and user-friendly. We found the following elements notable: 

• Interactive demo: Users can test the software with Gusto’s interactive demo.
• Cloud-based software: Gusto is a cloud-based platform with iOS and Android mobile apps. 
• Integrations: Gusto can integrate with more than 155 third-party applications. 

Gusto’s user-friendly dashboard is easy to navigate. Source: Gusto

Paychex 

Paycheck’s interface is also easy to use and work with. Consider the following ease-of-use factors:

• Cloud-based software: Paychex is a cloud-based platform with iOS and Android mobile apps.
• Integrations: Paychex can integrate with more than 200 third-party applications.
• Implementation specialist: An implementation specialist can help you set up your account and learn the software.

Paychex’s user-friendly dashboard provides a clear overview of payroll and other elements. Source: Paychex

Winner: Tie

During testing, we found both platforms intuitive and user-friendly. Both are easy to implement and learn. We like that they’re cloud-based, so users can access them from any location. Since both offer employee self-service features and iOS and Android mobile apps, employees and managers can handle HR functions from anywhere.

Customer Support

Gusto

Gusto’s customer support options include the following:

• Online resources: Employers can access helpful online resources like blog posts, tools and calculators, guides, data and research, and an online help center.
• Support channels: Gusto customer support can be reached by phone, email and live chat.
• Additional paid support: Premium plans have access to priority support, a dedicated customer success manager, certified HR expert support and an HR resource center. These features can also be added to Plus plans.

Paychex 

Paychex provides the following customer support options:

• Online resources: Employers can access helpful online resources like a knowledge center, calculators, webinars, podcasts and state compliance resources.
• Channels: Paychex customer support can be reached by phone and live chat.
• 24/7 support: Paychex offers 24/7 support and dedicated support representatives.

Winner: Paychex

Our research revealed that both vendors provide sufficient customer support. However, Paychex is the winner here. We like that Paychex offers 24/7 customer support – something most competitors don’t offer. Most plans also include a dedicated support representative, which can be especially helpful for new or remote businesses. If you partner with Paychex as a PEO, you will receive additional support with HR functions. 

Gusto vs. Paychex Recap

Choose Gusto if:

• You want a comprehensive payroll processing solution that includes standard HR functions.
• You need a platform that offers upfront transparent pricing and can scale with you as you grow.
• You have a mixed workforce with employees and contractors.

Choose Paychex if:

• You want a flexible HR solution with custom features and pricing.
• You want an HR solution that offers HRO and PEO plans. 
• You need a comprehensive, intuitive solution with 24/7 customer support.