Gusto vs Justworks: What We Recommend & Why
Charlette has over 10 years of experience in accounting and finance and 2 years of partnering with HR leaders on freelance projects. She uses this extensive experience to answer your questions about payroll.
Robie has more than five years of content writing experience and specializes in writing about payroll and human resources software for small businesses.
This article is part of a larger series on Payroll Services.
Gusto and Justworks both offer HR and payroll support and earn high scores in our evaluations for features and ease of use. Gusto is a payroll software that helps you manage your payroll and offer benefits, while Justworks is a professional employer organization (PEO) that focuses heavily on ensuring your business is complying with payroll and HR laws and offering the best benefits.
So, which one should you choose? In our assessment of Gusto vs Justworks, we recommend both for the following niches:
- Gusto: Best for small businesses wanting affordable but feature-rich software that helps them process payroll more efficiently while adding some HR support.
- Justworks: Best for businesses wanting to fully outsource HR compliance support because they have insufficient or no in-house HR expertise and/or need best-in-class employee benefit rates.
There are instances when neither Gusto nor Justworks is best. We found a good alternative if you’re struggling to decide between a professional employer organization (PEO) and HR or payroll software:
- Rippling: Best for businesses planning to grow that need the option to turn their PEO off and still have access to the HR payroll software system they’re familiar with.
Gusto vs Justworks Compared
 |  | |
Monthly Pricing | $39–$149 plus $6–$12 per employee | Starts at either $49 (Basic plan) or $99 (Plus tier) per employee |
Direct Deposit Processing Timelines | four- and two-day; next-day processing with premium plans | four business days prior to specified pay dates |
Health Insurance, Retirement, and Commuter Benefits | ✔ | ✔ |
Health Insurance Coverage | Available in 39 states | Available in all states |
Workers’ Compensation | ✔ | ✔ |
Employee Perks | Free Gusto Wallet app with “Cashout” option for early access to earned wages | Gym benefits and health advocacy services |
Payroll Tax Filings and Year-end Reporting | ✔ | ✔ |
State New Hire Reporting | ✔ | ✔ |
Time Tracking | Included in premium plans | Paid add-on |
Employee Onboarding | ✔ | ✔ |
Access to HR Advisers | Available in highest tier | ✔ |
Robust Software Integrations | ✔ | Limited |
When to Choose Gusto
Gusto is a good option for small businesses needing payroll because its features are automated, and it has multiple payment options, including a next-day direct deposit option, and provides a range of benefits you can offer to employees. It’s more of a software than a service and integrates with other common apps small companies use. Plus, it offers a lot for its price.
When to Choose Justworks
Justworks provides more of a service than a software. It handles payroll, files taxes for you under its employer identification number (EIN), and manages benefits for your employees. It’s best for those that want payroll and HR benefits but don’t have the time or expertise to manage them all, or larger companies that are comfortable giving up some control in return for being relieved of the administrative tasks of HR.
Gusto Pros & Cons
| PROS | CONS |
|---|---|
| Affordable, full-featured, easy to use | Health insurance is available only in 39 states |
| Offers most needed HR benefits like health and 401(k) | You have to upgrade to its premium plans for next-day direct deposits |
| Integrates with many third-party software | May not be flexible enough for businesses scaling quickly |
Justworks Pros & Cons
| PROS | CONS |
|---|---|
| Affordable PEO program | Less control over some HR functions |
| Handles compliances, takes legal responsibility | More expensive than Gusto, charges per employee |
| 24/7 customer service | Limited integrations |
Most Affordable: Gusto
When comparing Gusto vs Justworks, the former is more affordable—its starter plan costs only $39 plus $6 per employee, per month (monthly fees for Justworks’ Basic tier starts at $49 per employee). However, while pricing is important, keep in mind you get what you pay for. Gusto may be far less expensive, but it is a payroll software with only basic time tracking and HR tools. Justworks, on the other hand, offers PEO services. It handles more of the administrative work and takes on more responsibilities, including legal concerns in some cases.
Gusto Pricing
Features | Core | Complete | Concierge |
|---|---|---|---|
Monthly Pricing | $39 + $6 per employee | $39 + $12 per employee | $149 + $12 per employee |
Full-service Payroll | ✔ | ✔ | ✔ |
Unlimited Pay Runs | ✔ | ✔ | ✔ |
Payroll Tax Filings Including Year-end Taxes | ✔ | ✔ | ✔ |
Direct Deposit Timelines | Four-day and two-day | Next-day processing | Next-day processing |
Health Benefits Administration | ✔ | ✔ | ✔ |
Workers' Compensation | ✔ | ✔ | ✔ |
Self-Service Portal | ✔ | ✔ | |
PTO and Time Tracking | ✕ | ✔ | ✔ |
Employee Directory and Surveys | ✕ | ✔ | ✔ |
Offer Letters and Onboarding Tools | Standard | Premium; includes custom onboarding checklists, e-signatures, and software provisioning | Premium; includes custom onboarding checklists, e-signatures, and software provisioning |
Access to HR Templates and HR Advisors | ✕ | ✕ | ✔ |
Customer Support | Phone, chat, and email support | Phone, chat, and email support | Dedicated team with access to an exclusive phone number for support |
Gusto also offers a contractor-only plan that costs $6 per contractor monthly and includes 1099 processing, four-day direct deposits, and new hire reporting. It also only charges for the months that you processed contractor payments.
Justworks Pricing
Features | Basic | Plus |
|---|---|---|
1–24 Employees per month | $49 per employee | $99 per employee |
25–99 Employees per month | $44 per employee | $89 per employee |
100–174 Employees per month | $39 per employee | $79 per employee |
175+ Employees per month | Call Justworks for a quote | Call Justworks for a quote |
Regular and Off-cycle Payments | ✔ | ✔ |
Vendor and Contractor Payments | ✔ | ✔ |
Payroll Tax Filings Included Year-End Taxes | ✔ | ✔ |
PTO Management | ✔ | ✔ |
Time Tracking | Paid add-on | Paid add-on |
Online Employee Onboarding | ✔ | ✔ |
HHarassment Prevention and Inclusion Training | ✔ | ✔ |
COBRA Administration and Health Advocacy Services | ✕ | ✔ |
Workers' Comp, Life and Disability Insurance, Health and Wellness Perks, and 401(k) Plans | Pay by employee | Pay by employee |
Medical Insurance, Dental and Vision Insurance, and HSA/FSA Options | ✕ | Pay by employee |
Access to HR Templates and HR Consulting | ✔ | ✔ |
Customer Support | 24/7 support | 24/7 support |
Justworks also offers discounts if you have part-time employees—provided you’re on the Plus plan. For those whose part-time staff work on average less than 30 hours weekly, Justworks will bill you its Basic plan rate. If your part-timers work on average 30 or more hours weekly, you have to pay its Plus plan rate.
Best Payroll Features: Gusto
Gusto lets you manage payroll for any type of employee. Similar to Justworks, it calculates and remits payments; files state, federal, and local taxes; and does end-of-year tax reporting. It also handles multiple pay rates, tips credits, garnishments, PTO policies, and multistate payroll.
You can pay employees by check, direct deposit, or pay card. It even offers employees the option to get an advance of up to 40% of their paycheck through the Cashout feature of its Gusto Wallet app. Time, workforce, and project tracking are also included in the Complete and Concierge plans, but if you’re already using a time and attendance solution, Gusto integrates with time tracking systems like When I Work, 7shifts, Homebase, and QuickBooks Time (formerly TSheets).
When to Consider Justworks for Payroll
Justworks may not have multiple pay options and Gusto’s Cashout feature, but it can process payroll for you. While employees are paid via direct deposits, Justworks can also pay through checks, although you will need to print and send them yourself.
It handles all types of payouts, including tips, off-cycle payroll, bonuses, and contractor/vendor payments. While it integrates with QuickBooks Time, you can also use its time tracking tool, Justworks Hours, which is a paid add-on. Note, however, that it is available for free as of this writing and if you sign up until the end of December 2021, you only have to pay $5 per user, per month, in 2022.
Looking for payroll options other than Gusto and Justworks? Check our best payroll services guide for our top recommendations.
Best for HR & Employee Benefits: Justworks
As a PEO, Justworks will place you in an enterprise-level plan for insurance, which means much better rates—plus they’re available in any state. It works with UnitedHealth, Kaiser, and Aetna. It also provides dental and vision, HSA/FSA, medical reimbursement programs, gym benefits, commuter benefits, life and disability insurance, and health advocacy services. For 401(k) options, Justworks partners with Slavic and assumes fiduciary responsibility for it, so you can offer your employees this benefit without incurring legal risk.
While Gusto and Justworks both offer workers’ compensation through AP Intego and have HR experts on hand to answer your questions on compliance issues, Justworks is the stronger of the two for compliance. In addition to keeping you up-to-date on the changing laws and regulations, it offers online training for sexual harassment and discrimination prevention, so it’s easy to comply with state and city requirements.
When to Consider Gusto for HR & Employee Benefits
As a health insurance broker, Gusto has access to over 3,500 plans from more than 100 carriers that work with small businesses. Thus, it can find you a good plan for your employees, and it offers dental and vision insurance, HSA, FSA, retirement savings (through Guideline), commuter benefits, Gusto Cashout for early access of wages, and Gusto Wallet, a free financial management app. However, its health insurance isn’t available in 11 states (Alabama, Alaska, Hawaii, Louisiana, Mississippi, Montana, Nebraska, North Dakota, South Dakota, West Virginia, and Wyoming); if your business is located in one of the areas it services, Gusto is a good option for you.
Compared to Justworks, Gusto’s compliance support is simpler but includes new hire reporting, workers’ compensation, and Affordable Care Act (ACA), Health Insurance Portability and Accountability Act (HIPAA), and Employee Retirement Income Security Act (ERISA) compliance. It also handles child support garnishments for all states except South Carolina.
Best for Ease of Use, Customer Support & Integrations: Gusto
In assessing Justworks vs Gusto, we found that these two programs have wonderfully intuitive interfaces—and it’s easy to find the tools you need. Both have in-app help, online guides, and access to HR professionals who can give expert advice on HR, payroll, and compliance issues. The two also provide email, chat, and phone support, although Justworks offers these 24/7 while Gusto is only available during business hours.
However, if you need robust third-party software integrations, Gusto has a wider network compared to Justworks. The latter connects with only QuickBooks Time, QuickBooks, and Xero; the former integrates with accounting, hiring, learning management, time tracking, legal, POS, and collaboration tools.
Gusto vs Justworks: What Users Think
- Gusto: Gusto earned an average rating of 4.5 out of 5 on third-party sites like G2 and Capterra (as of this writing). It gets high marks from users for its intuitive interface and robust feature set. Employees praised the onboarding and employee portal, and managers appreciated the automations and ease of running payroll. However, customer support is a hit or miss—some said that its support team is helpful, while others complained about having received delayed responses.
- Justworks: Scoring an average rating of 4.7 out of 5 on G2 and Capterra (as of this writing), many users raved about the same three things: ease of use, intuitiveness, and customer service. They also appreciate the content of the benefits packages they could offer their employees. However, some wished it offered more integration and reporting options, including a more robust PTO calculator.
Need help selecting a payroll service? Our guide on how to find the right payroll solution contains essential tips for choosing the best one for your business.
How We Evaluated Gusto vs Justworks
Although we are comparing Gusto vs Justworks, it’s not to declare a winner. Both are excellent services that meet specific needs. Our evaluation highlights the providers’ differences and strengths so that you can decide which service is best for you. Aside from pricing and payroll functionalities, we looked at ease of use, HR features, integration and benefits options, customer support, and whether HR professionals are available to give expert advice. Click through the tabs below for a more detailed breakdown of our evaluation criteria.
25%
Pricing
25%
Payroll features
25%
Ease of use
10%
HR features
10%
Popularity
5%
Reporting
25% of Overall Score
We looked at whether providers offer transparent pricing, multiple plan options, and unlimited pay runs. We also checked if they charge setup fees and have a plan that costs less than $50 per employee. Both Gusto and Justworks received perfect marks here, although if you compare their starter tiers, Gusto is more affordable than Justworks. The former is priced at $39 plus $6 per employee monthly, while the latter costs $49 per employee monthly.
25% of Overall Score
Automated tax filing services, year-end tax report prep, automatic pay runs, and two-day direct deposits are just some of the features that we consider essential payroll services. Providers are rated more favorably if they offer both employee and contractor payroll services, including a tax penalty-free guarantee. Compared to Justworks, Gusto scored higher here given its multiple employee payment options.
25% of Overall Score
We looked for user-friendly, intuitive, and customizable platforms, including those that integrate with common small business software like QuickBooks, Homebase, and When I Work. We prefer providers with how-to guide options and live phone support. Gusto received higher marks here, mainly because of its robust integration options—Justworks only connects with QuickBooks Time, QuickBooks, and Xero.
10% of Overall Score
Having access to a professional who can provide expert advice on compliance issues is one of the top criteria, including new hire state reporting, online onboarding, and a self-service portal. We also favored providers who offer multiple benefits options, health insurance available in all US states, and a time tracking solution. Justworks won in this criterion—Gusto would have ranked higher here if not for the limited coverage of its health insurance plans (only 39 states).
10% of Overall Score
We took the average review ratings from G2 and Capterra, which are based on a five-star scale; any option with an average of 4+ stars is ideal. Also, any software with 1,000+ reviews on any third-party site is preferred. While both Gusto and Justworks received average user ratings of 4 and up, Gusto earned perfect scores here since it has more than 1,000 reviews online.
5% of Overall Score
Aside from offering basic payroll reports, we considered whether these are customizable and if you could create new reports to fit your specific needs. Gusto and Justworks both earned perfect marks in this criterion.
*Percentages of overall score
Bottom Line
When choosing Gusto vs Justworks, the main questions you need to ask are, how much HR work do you want to pass to someone else and how important is it for you to offer competitively priced insurance rates?
Both programs offer user-friendly software, access to benefits, and full-service payroll with tax filings and year-end reporting. Although Gusto makes it easy for you to manage your payroll and benefits yourself, Justworks’ PEO service takes on many day-to-day HR tasks and responsibilities.
However, if you want an affordable small business payroll solution with essential HR tools and robust third-party software integrations, Gusto is the best option for you. It may not have Justworks’ PEO services and extensive health insurance coverage (Gusto is limited to only 39 states), but it offers a wide variety of benefits options and even provides employees advance access to a portion of their salaries in case of financial emergencies. Sign up for a free trial today.
