When you buy through affiliate links in our content, we may earn a commission at no extra cost to you. Learn Paychex and Gusto claim they offer essential payroll features for businesses of all sizes. But on closer inspection, you’ll find they cater to specific audiences at opposite ends of the spectrum:
Gusto Payroll is for small businesses looking for simple payroll software, while Paychex suits larger corporations with dedicated HR teams.
To understand why, we compared Gusto Payroll vs Paychex on their key features, pricing plans, scalability, and ease of use—all important criteria when selecting payroll software.
Before we get started, here’s a quick overview of our findings.
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Gusto Payroll vs Paychex At a Glance
| Gusto Payroll | Paychex | |
| Starting Price | $40/mo + $6/mo/person | $39/mo + $5/mo/person |
| Free Plan | ❌ | ❌ |
| Tax Filing | ✅ | ✅ |
| Employee Benefits Management | Offers custom benefits plans with health benefits, 401(k) planning, commuter benefits, and more | Offers comprehensive benefits planning with group and individual insurance, 401(k) planning, HSA & FSA accounts |
| Employee Portal | ✅ | ✅ |
| Integrations | 150+ integrations for accounting, time tracking, expense management, etc. | 250+ integrations for accounting, time tracking, hiring, HR, etc. |
| General HR | ✅Offers hiring, onboarding, talent management, and compliance | ✅ Offers hiring, onboarding, PEO, and HR consulting but as paid add-on. |
| Customer Support | Email, chat, and phone support | Support via phone, chat and an online form |
| Read Review | Read our full Gusto review | Read our full Paychex review |
Gusto Payroll vs Paychex Pricing Compared
Paychex offers three pricing plans, while Gusto has four, including one for only contractors.
| Gusto | Paychex | |
| Free Version | ❌ | ❌ |
| Starter | $40 per month + $6 per person | $39 per month + $5 per person |
| Middle | $80 per month + $12 per person | Custom Pricing |
| Premium | Custom Pricing | Custom Pricing |
| Contractor Only | $35 per month + $6 per contractor | ❌ |
Gusto’s simple pricing structure starts at $40 per month with an additional $6 per employee. At this price, you get access to full-service payroll in one state with an employee self-service portal, benefits planning, HR tools, and integrations. You’ll need to upgrade to a higher plan if you want to run payroll in multiple states.
Meanwhile, Paychex is slightly cheaper than Gusto, starting at $39 per month with an additional $5 per employee. However, you only get access to essential payroll features like direct deposit, payroll taxes, employee self-service portal, and so on.
Features like employee benefits and time tracking — that are included in Gusto’s paid plans — are only available as paid add-ons in Paychex.
So, despite being cheaper at first, Paychex eventually becomes more expensive as you add more features and integrations.
Gusto Payroll vs Paychex Ease of Use
Running payroll in Paychex is a quick process—just enter the payroll details, payment schedule, and start processing payroll. It also offers an employee self-service portal for employees to update payroll information, manage benefits packages, and track time.
However, we found its user interface outdated and cluttered with features, making it difficult for new users to navigate. In our opinion, Paychex suits experienced HR professionals looking for a functional tool to quickly run payroll.
If you’re just getting started with payroll, we strongly recommend Gusto. Its streamlined workflows and automation make it easy for anyone to set up and run payroll. You also get access to countless third-party integrations to seamlessly connect with your existing tech stack.
But its simple interface can be difficult to use if you have a complex organizational structure. Because of this, we recommend Gusto for small business owners looking to run payroll for a few employees.
Gusto Payroll vs Paychex Key Features
Gusto Payroll is a better payroll software overall since it offers more value for money with streamlined workflows, useful integrations, and unlimited payroll runs.
But that doesn’t mean you should write off Paychex. It offers some valuable payroll features, especially for large businesses.
We’ll look at this in more detail by comparing Gusto Payroll vs Paychex on four key features:
- Payroll
- Direct deposits
- Time tracking
- Benefits management
So, let’s get started!
Payroll
Gusto and Paychex offer full-service payroll features to calculate employee pay, file taxes, and account for additional income like bonuses and commissions. You can also set custom pay periods, but this is where the similarity ends.
Paychex does offer more customizability compared to Gusto but limits how many times you can run payroll. If you cross the limit, you’ll have to pay extra charges.
If you’re a new business owner, you’ll appreciate Gusto’s streamlined payroll setup. Moreover, you can run unlimited payroll per month, irrespective of the number of employees and employee type.
Direct Deposits
Gusto lets employees choose how money is deposited. They can add up to five bank accounts and split payments across each bank.
Employees can also receive payments in Gusto’s spending account. These work like any interest-bearing bank account but credit salaries two days faster.
Meanwhile, Paychex offers simple direct deposits into employee bank accounts. If you opt for the higher-paid plans, you get access to more payment methods.
Time Tracking
Gusto offers a simple time clock where employees can log time using the web app or the Gusto Wallet app. It also comes with unlimited project tracking—perfect for service companies working on multiple projects.
Similarly, Paychex’s time tracking feature lets you log time using the web and mobile app. It also offers physical kiosks with iris and biometric scanning for on-site employees. If your employees work off-site, you can track them using geolocation and geofencing features.
However, like most features, time tracking is also an optional add-on in Paychex. Moreover, its user interface is old-school and unintuitive, while Gusto offers a robust interface that employees will enjoy using.
Benefits Management
Gusto offers three levels of financial and health benefits:
- No-cost benefits like benefits renewals, financial insights, and a wallet app.
- Low-cost benefits like worker’s comp, HSA and FSA, and commute expenses.
- Premium benefits like health and dental insurance plans, 401(k) planning, and broker integrations.
Depending on employee eligibility, you can decide what benefits employees can avail of on the Gusto benefits dashboard, including plan selection, deductions, and employee benefits enrollment.
However, Gusto only offers these benefits in 37 U.S. states and entities. If your employee works out of a state not on the list, they’ll need to enroll for benefits through a third party.
Meanwhile, Paychex offers more comprehensive benefits like group health insurance, retirement services, flexible spending accounts, and health savings accounts.
Employees can create their own benefits plans via the benefits dashboard or the mobile app. Paychex also offers various programs for upskilling and improving an employee’s overall well-being.
However, unlike Gusto benefits, which are included with its paid plans, Paychex benefits management is a paid add-on.
Gusto vs Paychex Integrations
When it comes to sheer quantity, Paychex takes the cake with 250+ integrations compared to Gusto’s measly 193 integrations. But we chose Gusto as the winner here for two reasons:
- Quantity doesn’t mean quality. Though Paychex has a large number of integrations, we found Gusto offers integrations with popular tools like Google Workspace, Zoom, and Asana. Although Paychex also offers these integrations, you’d still end up paying for integrations that you won’t use.
- Paychex integrations are only available as paid add-ons. Using integrations with Paychex will only add to the overall subscription cost, varying depending on the integrations you choose. Meanwhile, Gusto integrations are included with the paid plans. You can even avail of discounts for subscribing to specific tools if you’re a Gusto user.
However, Paychex does offer an API to integrate your third-party software for your accounting, hiring, and HR requirements—something Gusto doesn’t have. This, of course means you’ll need a development team to help with integrating your business software with Paychex.
In our opinion, Paychex makes more sense if you’re a large, established business looking to use a specific toolset. But if you’re a small business or just getting started with payroll, we’d recommend going with Gusto.
Gusto vs Paychex Scalability
Gusto offers more scalability compared to Paychex, mainly because its plans and features cater to growing businesses.
With Gusto, new business owners get access to an easy-to-use platform with streamlined workflows and automation capabilities, leaving them free to focus on running their businesses. You only have to pay extra when you add new employees to your payroll.
Paychex offers similar payroll features, but advanced features are only available as paid add-ons. So, if you’re a small business, you’ll need to pay extra for offering employee benefits, hiring, and tracking time.
So, if you’re just starting out, choose Gusto Payroll with its all-inclusive pricing plans.
Gusto vs Paychex Customer Reviews
Customers love Gusto for its intuitive interface and scalability. They really appreciate Gusto’s self-service features like the wallet and informative digital pay stubs. However, some users have said that using Gusto to manage larger, complex teams may be difficult.
On the other hand, Paychex users appreciate its feature-rich platform and payroll services. But customers have faced problems while managing benefits, and its customer service is slow to respond.
Overall, users had a better experience with Gusto’s easy-to-use solution. Its interface and self-service portal made it easier for small business owners to run payroll for a few employees.
Conclusion – Gusto vs Paychex: Which One Wins?
Both Paychex and Gusto Payroll are feature-rich payroll software offering essential features like payroll automation, benefits management, and integrations.
While Paychex is better for corporations with a dedicated HR team, we believe Gusto Payroll is a better payroll software overall than Paychex.
It offers an easy-to-use platform that simplifies payroll processes for small businesses. Moreover, its straightforward pricing plans are designed to scale so business owners can focus on growing their business without any worries.
Check out our Gusto Payroll review for more information!
How We Test Payroll Software
- Pricing — We compared how both platforms price their products and the value for the money they offer.
- Features — We thoroughly checked the user documentation and signed up for free trials (if available) to understand how each platform works.
- Integrations — We scanned the list of integrations to see if they offer useful tools that you’re likely to use.
- Automation — We checked what kind of automation features are available and their accuracy.
- Ease of use — We analyzed how easy it is to use each platform from a new and experienced user’s perspective.
- Third-Party Reviews — We went through user reviews from reputed sites like G2 and Capterra to understand the overall user sentiment in the market.
How to Choose the Best Payroll Software
When it comes to choosing the best payroll software, your choices are limited to just these two. So, consider the following to ensure if they suit your needs.
- Budget — Check whether the platform falls within your budget. Also, ensure the plans include all the essential features you need to run your business.
- Ease of Use — Payroll software should save your management time. So test the platform using free trials or demos to check if it actually simplifies your payroll processes.
- Compatibility — Ensure the platform you choose integrates with your existing software so business continues smoothly without much disruption.
- Key Features — Determine whether the features provided cater to your business’s payroll requirements. For example, does it offer both weekly and monthly payouts?
- Scalability — Understand how easy it is to upgrade (or downgrade) your plan to meet your changing business requirements.
- Customer Support — Payroll processes are complex. So check whether customer support is responsive and helpful.
