Compared to ADP, Gusto is more affordable and caters to smaller businesses that are mostly concerned about paying their employees and complying with payroll tax laws. ADP on the other hand has a flexible platform that supports growing businesses with payroll and HR needs that may evolve in the near future. They both give you tools to pay your employees, automate payroll tax management, and provide HR support.
- Gusto: Best for small businesses (less than 100 employees) that want unlimited monthly payroll runs
- ADP: Best for companies with major growth plans that may need access to advanced HR features, like background checks and employee training
An In-Depth Look at Gusto vs ADP Features
Features | ||
|---|---|---|
*Cost for 10 employees | $1,188 per year | $3,079 per year |
Pay Options | Manual check (printed in-house), direct deposit, pay card | Paper checks signed and delivered, direct deposit, pay card |
Health Insurance and Other Benefits | Health insurance in 27 states, flexible spending accounts, retirement, commuter, tuition savings | Health insurance in 50 states, retirement |
HR Support | Onboarding, new hire support, advising | Background checks, onboarding, new hire support, handbooks, advising |
Customer Service | Phone support 5 days/week; reliable, consistent | 24/7 phone support; can take a while to resolve issues |
Add-ons for Plan Customization | Time tracker | Time and attendance, benefits, advising, PTO tool, software integration |
User Reviews | 4.8 out of 5 stars | 4.2 out of 5 stars |
*Pricing estimates are for 10 employees with biweekly payroll. However, Gusto charges monthly based on the number of active employees you have, whereas ADP prices by payroll run. Therefore, your actual price with ADP may change from month to month.
Still not sure which payroll service is right for you? Answer four questions on our Gusto vs ADP quiz to find out.
Gusto vs ADP Which Is Best for You?
Answer a few questions about your business, and we'll give you a personalized product match.
Pricing: Why Gusto Beats ADP
- Gusto’s pricing is transparent whereas ADP’s isn’t; you have to speak with an ADP rep to get a quote.
- Gusto doesn’t charge a setup fee; ADP’s setup fee is usually $200.
- Gusto doesn’t charge extra for annual tax reports, while ADP charges for each 1099 or W2 form it has to send out along with a one-time annual reporting fee.
- You can pay as low as $6 per month per worker with no base fee if you only pay contractors; during months you don’t need to pay the contractors, Gusto won’t charge you.
- You can run payroll as many times as you want at no extra charge. ADP charges extra for additional pay runs (weekly is more expensive than biweekly payroll).
- Gusto doesn’t charge extra or make you upgrade plans if you need to integrate software. ADP does.
To learn more about Gusto’s pricing and why it’s a great value, check out our full Gusto review.
When ADP’s Pricing Is Right
Although ADP is generally more expensive overall, it offers three month of free use vs Gusto’s 30 days. Also, because ADP’s pricing isn’t transparent, its representatives have more power to negotiate with customers. For instance, they will sometimes waive the setup fee and customize plans to your budget. Gusto’s pricing is set.
Customization & Flexibility: Why ADP Beats Gusto
- ADP has eight plans to choose from vs Gusto’s three.
- ADP has numerous add-ons you can use to mix and match under a custom plan whereas Gusto doesn’t; time tracking is Gusto’s primary add-on option.
- ADP has plans for small businesses, one to 49 employees, and some for larger companies, up to 1,000+. Gusto is made for companies with less than 100 workers.
When Gusto’s Customization & Flexibility Is Enough
Gusto works if the main function you’re looking for is full-service payroll. All three of Gusto’s plans come with full-service payroll; the premium plans have time tracking and more HR tools.
Health Insurance: Why ADP Beats Gusto
- ADP offers health insurance in 50 states, and Gusto is limited to 27 states.
- ADP has a Professional Employment Organization (PEO) option that gives employers and employees affordable rates. Gusto doesn’t have this option.
When Gusto’s Health Insurance Benefits Are Enough
If you live in one of the 27 states that Gusto offers health insurance, it could be a good option:
Arizona, California, Colorado, Florida, Georgia, Illinois, Indiana, Maryland, Massachusetts, Michigan, Minnesota, Missouri, Nevada, New Jersey, New York, North Carolina, Ohio, Oregon, Pennsylvania, South Carolina, Tennessee, Texas, Utah, Virginia, Washington DC, Washington, and Wisconsin
HR Support: Why ADP Beats Gusto
ADP offers HR features you just won’t get with Gusto:
- Background checks
- Job board subscription (ZipRecruiter)
- Employee and employer training
- Prepaid legal assistance in case you run into an HR snafu
In addition to those, ADP also offers the basic introductory HR features that Gusto provides, like new hire onboarding support and access to an HR library of forms, so you don’t lose out on any features.
When Gusto’s HR Support Is Enough
Gusto’s HR support is quality and a great value for small companies that otherwise wouldn’t have access to them. If you’d be satisfied with the following HR features, Gusto may be a solid choice for your company:
- New hire reporting to the state
- Offer letter preparation for new hires
- HR advising on complex issues
- Paid-time-off policies
- Document storage
Benefits like flexible spending accounts and tuition savings programs are also available.
Customer Service: Why Gusto Beats ADP
There’s no other way to say it. Customers just tend to have better experiences with Gusto’s support team. Wait times seem to be shorter, and it’s easier to find a solution to your problem than it is with ADP. ADP is a larger company with a wide range of clients (remember, Gusto primarily services small businesses), so getting to the right person can require a couple of transfers. We’ve communicated with both support teams and have found that to be true; however, both teams were also pleasant.
When ADP’s Customer Service Is Right
- You need 24/7 access to the customer service team. Gusto’s reps are only available five days a week.
- You’ll pay extra to have a dedicated customer service representative you can always work with versus having to work with different people each time you call in.
When to Use Gusto as a Payroll Processing Company
Gusto is the best payroll processing company for small businesses with under 100 employees because it delivers services comparable to big-name competitors at a significantly lower price—as low as a $39 base monthly price, plus $6 per employee (with a free 30-day trial). Unlike ADP, Gusto prepares year-end tax reports (W-2 and 1099s), integrates with other software, and gives you onboarding and compliance support at no additional cost.
Gusto Strengths | Gusto Weaknesses |
|---|---|
Payroll and HR features all in one package | Only offers insurance in 27 states |
Affordable | Doesn’t work well for businesses with >100 employees |
Unlimited pay runs | |
Automation |
When to Use ADP Run as a Payroll Processing Company
ADP Run is a great payroll option for small businesses that have growth plans in place or are already in the 500+ employee range. It has eight product plans to choose from, designed to support businesses as they grow from 10 employees to 1,000. It performs all of the basic payroll functions and offers a robust set of HR and compliance features, much more comprehensive than Gusto. You can pay extra for tools like talent acquisition and performance management.
ADP Strengths | ADP Weaknesses |
|---|---|
Personalized payment options | Pricey |
Customizable with lots of add-ons | Customer service can be time-consuming |
Fit for small and large companies | |
Strong HR features |
Bottom Line
Gusto and ADP offer many of the same types of payroll products, but their services are very different. We recommend you choose the best payroll solution based on both your current and expected future needs. ADP is best if you’re planning to scale your business and/or foresee a need for top-notch HR support. Gusto is much cheaper and works well for small businesses that primarily need payroll support with some introductory HR services included.
