Paychex vs ADP vs Gusto: Pricing, Features & What’s Best
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.
Paychex, ADP, and Gusto are all popular payroll software, but for different reasons. ADP and Paychex are established providers that offer comprehensive HR and payroll services for businesses of all sizes, and Gusto is a newer provider that gives small businesses an affordable full-service payroll option with features they’d pay extra for with other services. ADP and Paychex are very similar overall but have some different products that might make one a better fit for certain businesses over the other.
- Paychex: Best for one-person to midsize businesses looking for strong HR and payroll support
- ADP: Best for growing companies that plan to scale quickly and need flexible plan option that change with their growth
- Gusto: Best for small businesses with 100 employees or less looking for an affordable payroll and HR software
Paychex vs ADP vs Gusto Compared
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Starter Monthly Pricing | Starts at $39 plus $5 per employee | Custom-priced | Starts at $39 plus $6 per employee |
Automatic Pay Runs | ✔ | ✔ | ✔ |
Pay Options | Pay-on-demand, paper check, pay card, and direct deposit | Pay card, direct deposit, and paper checks signed and delivered | Pay card, direct deposit, and manual check (printed in-house) |
Payroll Tax Calculations, Payments, and Filings | Some services may have additional fees | ✔ | ✔ |
Year-End Tax Reporting (W-2/1099) | Costs extra | Costs extra | ✔ |
Health Insurance Covers All US States | ✔ | ✔ | Limited to 39 states |
Retirement, Medical, Dental, and Vision Plans | ✔ | ✔ | ✔ |
Employee Discounts | ✖ | ✔ | ✖ |
Workers’ Comp (pay-as-you-go plans) | ✔ | ✔ | ✔ |
State New Hire Reporting and Onboarding Tools | ✔ | ✔ | ✔ |
Job Postings and Background Checks | ✔ | ✔ | Basic job postings |
Performance Reviews and Learning Management Tools | ✔ | ✔ | Only performance reviews |
Ease of Use | Excellent | ||
Customer Support | 24/7 phone support; dedicated payroll specialist | Email and 24/7 phone support; access to HR advisors | Email and chat; phone support five days per week; access to HR advisors |
If you’re unsure about which payroll provider is best for your business, answer a few questions in our Paychex vs ADP vs Gusto quiz, and we will help you decide.
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Why Paychex Is Best for One-person to Midsize Businesses
Paychex is the only provider of the three that has a self-employed product that comes with payroll, a retirement plan, and business incorporation services. Solopreneurs can start with its Paychex Solo solution and transition to Paychex Flex once they start managing employees and need more HR, payroll, and compliance support. Its robust suite of HR tools, which includes new hire reporting, onboarding, background checks, and time and attendance, is well-suited for midsize businesses.
Why ADP Is Best for Quickly Scaling Companies
While Paychex also offers multiple tiers that cater to different business sizes, ADP has a wider selection of products and plans that help companies scale their HR operations quickly. Its packages are targeted toward companies with fewer than 50 employees to those with 1,000+ employees; its midsize to large business offerings even include hands-on implementation assistance and expert support from certified payroll and HR professionals.
Why Gusto Is Best for Small Businesses
At a low cost, Gusto provides all the basics—like unlimited and automatic pay runs, payroll tax payment and filing services, year-end tax reporting, and employee benefits. Aside from payroll, it offers basic hiring and onboarding tools plus performance reviews and simple time tracking tools. Gusto doesn’t charge extra for payroll tax administration services—both ADP and Paychex have add-on fees for some of its tax services.
If you want more information about which options to look for when choosing a payroll service, check our guide on finding the right payroll service for your business.
Best for Affordability: Gusto
Paychex, ADP, and Gusto all have multiple plans with month-to-month billing. However, only Gusto offers fully transparent pricing and pay processing tools that let you run payroll and off-cycle payments as many times as you need and want. Plus, it doesn’t charge add-on fees for payroll tax filings and year-end reporting.
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Pricing Transparency | Limited | ✖ | ✔ |
Base Monthly Pricing | Starts at $39* | Call ADP for quote | $39–$149 |
Per-Employee Fees | $5 per month* | Call ADP for quote | $6 and $12 per month |
Special Payroll Plan | Paychex Solo (Custom-priced) | ✖ | Contractor plan** ($6/person monthly) |
Payroll Tax Payments and Filings | Add-on (call for quote) | ✔ | ✔ |
Year-end Tax Reporting | Add-on (call for quote) | Add-on (call for quote) | ✔ |
*Pricing is for Paychex Flex’s starter plan. Its other tiers (Select and Pro) are custom-priced.
**Gusto will only bill you for the months that you processed contractor payroll.
Why We Recommend Gusto for Affordability
Subscribing to Gusto makes more sense if your company needs to do payroll for fewer than 100 employees. All of its plans come with full-service payroll, unlimited and automatic pay runs, tax filings, and year-end reporting. Plus, its basic tier has features that you only get in Paychex’s and ADP’s higher plans.
- When comparing Paychex vs ADP vs Gusto for pricing transparency, Gusto is the winner among the three because its plans are fully transparent. You can easily do cost comparisons between its options to see which one fits your budget and payroll needs. Paychex may publish the monthly fees of its Paychex Flex’s basic plan on its website, but pricing details of its higher packages and other products (like hiring services) follow a call-for-a-quote scheme. ADP also requires you to contact its sales team to get pricing information.
- Even with its basic Core plan, Gusto offers features (such as State Unemployment Insurance management and time-off policy tracking) that Paychex and ADP either include in its higher tiers or as part of a paid add-on solution. With Gusto, you only have to pay $39 plus $6 per employee monthly for both features.
- The starter per-employee fees of Paychex’s payroll solution, Paychex Flex, may be slightly lower than Gusto’s but you end up paying more with Paychex. This is because of the add-on fees it collects for handling your payroll tax filings and year-end reporting. ADP also charges extra for generating, delivering, and filing W-2/1099 tax forms at year-end. However, if you’re a midsize business with over 100 employees and need advanced HR solutions for managing workers, Paychex (monthly fees start at $39 plus $5 per employee) would be a more cost-effective option than Gusto—provided you don’t mind paying extra for payroll tax filings.
- Gusto is also great for small businesses that employ mostly contract workers because it has a low-cost contractor-only payroll plan ($6 per contractor monthly). With ADP and Paychex, you have to pay monthly base and per-employee fees even if you’re only processing contractor payments.
When to Consider ADP & Paychex
It’s difficult to compare Gusto vs Paychex and Gusto vs ADP for affordability because many, if not all, of ADP’s and Paychex’s products and plans are custom-priced. However, there are a few instances where either ADP or Paychex may be a more suitable option for you.
Best Payroll Features: Gusto
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Unlimited Pay Runs | ✖ | ✖ | ✔ |
Automatic Payroll | ✔ | ✔ | ✔ |
International Payroll | ✖ | ✔ | ✖ |
Direct Deposit Timelines | Two days | Two days | Standard is two and four days; next-day option in higher tiers |
Pay Card and Pay On-Demand | ✔ | ✖ | ✔ |
Paper Checks with Signing, Stuffing, and Delivery Services* | On-site printing with check logo and signing services | ✔ | Manual checks (printed in-house) |
Payroll Tax Calculations, Payments, and Filings | ✔** | ✔ | ✔ |
Generates, Prints, and Files W-2/1099 Tax Reports | ✔** | ✔** | ✔ |
Wage Garnishment Services | ✔ | ✔ | Child support payments to South Carolina not included |
State Unemployment Insurance Management | ✔* | ✔* | ✔ |
Digital Pay Stubs | ✔ | ✔ | ✔ |
Employee Self-Service Portal | ✔ | ✔ | ✔ |
*Some solutions and services are available only in higher tiers
**May require additional fees
Why We Recommend Gusto for Payroll Features
Gusto is our top-recommended payroll software for small businesses because it has the best value for the payroll features it offers. Plus, some of its pay processing functionalities are slightly better than those from Paychex and ADP.
- Paychex and ADP have automatic payroll capabilities but don’t offer unlimited pay runs—Gusto offers automatic payroll with unlimited pay runs and off-cycle payments.
- While you get standard two-day direct deposits with Paychex and ADP, Gusto has two- and four-day options, but provides next-day direct deposits in its higher tiers.
- Paychex and ADP charge extra for some of its payroll tax administration services (like tax filings and year-end reporting)—you get this for free with Gusto.
Best Employee Benefits: Paychex & ADP
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Health Insurance Coverage* | All 50 states | All 50 states | Only 39 states** |
Retirement Plans* | ✔ Plus a 401(k) option for solopreneurs | ✔ | ✔ |
Life and Disability Insurance* | ✔ | ✔ | ✔ |
Workers’ Compensation | Pay-as-you-go plans | Pay-as-you-go plans | Pay-as-you-go plans |
HSA and FSA Options* | ✔ | ✔ | ✔ |
College Tuition Savings Plan* | ✖ | ✖ | ✔ |
Commuter Benefits* | ✖ | ✖ | ✔ |
Premium-only Plans** | ✔ | ✔ | ✔ |
Employee Discounts with Retail Shops | ✖ | ✔ | ✖ |
Financial Assistance | Early access to earned wages (via PayActiv) | ✖ | Early access to earned wages (via Gusto Cashout) |
Financial Wellness Program | ✔ | ✖ | Free financial management app (Gusto Wallet) |
Benefits Administration | ✔ | ✔ | ✔ |
Online Benefits Enrollment | ✔ | ✔ | ✔ |
*Some plans may require participation fees or premium payments.
**Premium-only plans help you and your employees to save on certain payroll taxes by allowing your staff to prepay a portion of health insurance premiums using pre-tax dollars.
Why We Recommend Paychex & ADP for Employee Benefits
When comparing Paychex vs ADP vs Gusto just on health benefits, ADP and Paychex offer the best coverage. Their health insurance options are available across the US, while Gusto’s health plans are limited to 39 states (as of this writing). Paychex and ADP are also our top picks for employee benefits because they have helpful perks (like discounts and financial wellness tools) that your staff will appreciate.
- Paychex is the only provider in this guide that offers a better selection of financial wellness tools on top of the typical benefits options (such as workers’ comp, medical, dental, vision, and retirement plans). Aside from short-term loans, your employees are granted advanced access to their earned salaries between paydays in case of emergencies. Educational resources are also available to help your workers manage their finances and meet their savings goals.
- ADP also provides employee benefits that companies usually offer to their workers, such as health, retirement, FSA/HSA, and disability insurance plans. While it lacks Paychex’s financial wellness tools, it makes up for it by providing an employee perk that allows your staff to get discounts from popular brands and retail shops.
When to Consider Gusto for Employee Benefits
Gusto is a great choice if your business isn’t located in one of the 11 states (see map below) not covered by its health plans. It offers a wide variety of employee benefits with unique options, like college tuition savings plans. Similar to Paychex, workers who need money for emergencies can use its Gusto Cashout feature to get a portion of their average salary, max 40% or up to $500 ($200 for the first transaction).
Best HR Features: ADP
| | | |
Applicant Tracking | ✔* | ✔* | ✔ |
Job Postings | Posts to dozens of job sites* | Posts to 25,000+ job sites | Job listings appear in Google Jobs; provides shareable job posting links |
Background Screening | Limited number of screens | ✔ | ✖ |
Online Offer Letters and Document Storage | ✔ | ✔ | ✔ |
Employee Self-Onboarding | ✔ | ✔ | ✔ |
Software Provisioning | ✖ | ✖ | ✔ |
Computer Device Management | ✖ | ✖ | Only for MacBooks as of this writing |
State New Hire Reporting | ✔ | ✔ | ✔ |
Time Tracking | ✔* | ✔* | ✔** |
Compensation Planning | ✔* | ✔* | ✖ |
Learning Management | ✔ | ✔ | ✖ |
Performance Management | ✔* | ✔* | ✔** |
*Paid add-on
**Available in higher tiers
Why We Recommend ADP for HR
Comparing ADP vs Paychex’s HR tools is difficult since they have many similar features. They offer robust HR solution suites for managing the entire employee lifecycle. However, ADP has a few key advantages over Paychex—it can post job listings to over 25,000 job sites and doesn’t have a limit to the number of background screens you can run. This makes ADP ideal for employers who want efficient hiring tools that are bundled in payroll software.
Gusto also offers HR solutions, but these aren’t as robust. It lacks the learning management and compensation planning tools that the two others offer. And while Gusto can help you track applicants, it doesn’t let you post jobs to popular job sites—although, it provides shareable job posting links you can add to your career website.
Best for Ease of Use & Customer Support: Paychex
| | | |
Ease of Use | Good | Good | Excellent |
24/7 Customer Service | ✔ | ✔ | Weekdays only |
Support Type | Phone | Email and phone | Email, chat, and phone |
How-to Guides | ✔ | ✔ | ✔ |
Access to HR Advisery Services | ✖ | ✔* | ✔* |
Dedicated Payroll Specialist | ✔* | ✖ | ✖ |
*Available in higher tiers
Why Paychex Is Best for Ease of Use & Customer Support
Paychex, ADP, and Gusto all have intuitive interfaces with tools that are cloud-based and generally easy to use. However, what sets Paychex apart from the other two is the dedicated payroll specialist that it assigns to its clients. With only one point person to contact for payroll and tax concerns, you can easily get expert advice without having to go through different customer service reps. You also have access to online guides and 24/7 phone support.
How We Evaluated Paychex vs ADP vs Gusto
We evaluated Paychex vs ADP vs Gusto by looking at each provider’s pricing structures, features, and ease of use. We also checked whether HR professionals are available to give expert advice. Customer support was also an important factor since small business owners may need help navigating through the software.
Bottom Line
Deciding among ADP vs Paychex vs Gusto can be challenging since they have a lot of similar payroll and HR tools. However, we recommend you choose the best HR payroll software based on both your current and expected future business needs.
ADP can support large growth plans given its multiple yet flexible payroll tiers. If you need a special solopreneur package or you’re planning to stay a midsize employer, Paychex can provide you with a more personalized payroll experience and service. If your business has a simple structure with fewer than 100 employees, Gusto’s full-service plans would likely be a better fit.
