Choosing the right payroll system is one of the most critical decisions small business owners face. As payroll processing grows increasingly complex with changing tax laws and compliance requirements, having reliable software becomes not just a convenience but a necessity. ADP and Gusto have emerged as dominant players in the payroll software market, each offering distinct approaches to solving your payroll challenges.

This comprehensive analysis examines these two powerhouses through the lens of features, usability, pricing, customer support, and more-giving you the insights needed to make an informed decision. With over 75 years of experience, ADP (Automatic Data Processing) brings decades of payroll expertise to the table, while Gusto, founded in 2011, has rapidly gained popularity with its modern, user-friendly approach to payroll and HR management. Both systems promise to simplify your payroll processes, but they differ significantly in their execution, pricing models, and additional offerings.

The right choice depends on your specific business needs-whether you prioritize extensive HR capabilities, state-of-the-art technology, budget-friendly options, or scalability as your business grows. By understanding the strengths and limitations of each platform, you can select the solution that will not only meet your current requirements but also support your business as it evolves in the years ahead.

What Makes Each Payroll System Unique?

ADP Run provides multi-state payroll processing across all its plans, making it ideal for businesses with employees in different jurisdictions. The platform features a two-day processing cycle without direct deposit limits and can register with tax agencies in all 50 states without requiring third-party partners. ADP also offers same-day ACH transfers, giving businesses more flexibility with payment timing and handling complex payroll scenarios like employees working across multiple states.

Gusto excels in automation and user experience, offering unlimited payroll runs across all plans and handling both employee and contractor payments with ease. While its Simple plan limits users to single-state payroll, the Plus and Premium plans support multi-state operations. Gusto automatically calculates and files payroll taxes at no extra charge, including W-2 and 1099 forms, and their AutoPilot feature allows businesses to set up recurring payroll runs that process automatically.

Where these platforms truly diverge is in their approach to complex payroll situations. ADP demonstrates an advantage in its capacity to handle intricate scenarios, such as employees who work in multiple states or local jurisdictions within a single pay period. Gusto, while more limited in handling complex situations, offers a more streamlined experience that many small business owners find sufficient and considerably more intuitive, especially for those without dedicated payroll personnel.

Key Payroll Features Comparison

Both platforms offer comprehensive payroll processing capabilities, but with notable differences in their execution and specialization. ADP Run focuses on flexibility and compliance across complex business scenarios, leveraging decades of industry experience. Gusto prioritizes simplicity and automation, making payroll management accessible even to business owners with minimal payroll experience.

When examining core functionality, several distinguishing features emerge for each platform. These differences can significantly impact your daily operations and long-term satisfaction:

• ADP Run strengths: Multi-state tax filing across all plans, same-day ACH transfers, specialized industry payroll solutions, and advanced compliance management tools built from decades of experience.
• Gusto strengths: Unlimited payroll runs on all plans, automatic tax calculations and filings included, AutoPilot for recurring payroll, and lifetime access to pay documents for employees even after they leave.

The ideal choice depends largely on your business complexity and growth plans. Businesses with straightforward payroll needs and a preference for modern, intuitive interfaces often gravitate toward Gusto. Companies with multi-state operations, complex compensation structures, or plans for significant growth might find ADP's robust capabilities worth the investment despite the steeper learning curve.

How Much Will You Pay For Payroll Services?

Pricing represents perhaps the most significant contrast between ADP Run and Gusto. Gusto embraces transparency with clearly defined pricing tiers: Simple ($40/month plus $6 per employee), Plus ($80/month plus $12 per employee), and Premium (custom pricing). They also offer a Contractor-only plan at $35/month plus $6 per contractor, with no setup fees or hidden costs across all plans.

ADP employs a quote-based pricing model that varies based on business size, features required, and payroll frequency. This custom approach means you'll need to contact their sales team for specific pricing, and unlike Gusto, ADP charges per payroll run rather than offering unlimited runs. They may also include setup fees, though these are sometimes waived during promotional periods, and W-2 and 1099 filings typically incur additional fees with ADP.

When calculating total value, consider what each plan includes beyond basic payroll processing. ADP's higher price point comes with decades of experience in compliance management and a more robust suite of HR tools as you move up their service tiers. Gusto's more affordable entry point provides solid payroll functionality with modern HR features included even in lower tiers, often representing better value for small businesses with straightforward payroll needs.

Hidden Costs and Value Considerations

Beyond the advertised pricing, several factors can impact your total investment in either platform. Understanding these potential additional costs helps ensure your budget accurately reflects the true expense of your payroll solution:

• ADP potential extras: Per-payroll run fees, year-end tax form processing charges, setup fees (sometimes waived), state unemployment insurance management fees, and premium support costs.
• Gusto potential extras: State tax registration fees in certain jurisdictions, premium support add-ons for Plus plan users, and additional charges for benefits administration with external brokers.

The value equation extends beyond just the monthly subscription cost. Gusto includes unlimited payroll runs, automatic tax filings, and basic HR tools even in its entry-level plan, potentially saving hundreds or thousands of dollars annually compared to platforms charging for these services separately. ADP's higher price point delivers specialized compliance support, industry-specific solutions, and scalable infrastructure that can accommodate businesses from startup through enterprise levels.

Why User Experience Matters For Payroll Software

The user experience has become a critical differentiator in today's software landscape, and this is where the contrast between ADP Run and Gusto becomes particularly pronounced. Gusto has earned a reputation for its exceptionally intuitive interface, designed with modern small business owners in mind. The clean, straightforward dashboard guides users through the payroll process with simple prompts and visually appealing layouts that new users can quickly master.

ADP Run, while continuously improving its interface, still reflects its enterprise heritage with a more comprehensive set of screens and options that may require more time to master. However, once familiar with the system, many appreciate the depth of functionality available. ADP also offers a mobile app that provides full payroll capabilities, whereas Gusto's mobile experience is primarily focused on employee self-service rather than administrator functions.

Both platforms provide employee self-service portals, allowing team members to access their pay stubs, tax forms, and personal information. Gusto's employee portal receives particularly high marks for usability and includes lifetime access-even after an employee leaves the company. ADP's employee self-service functionality is equally comprehensive but follows a more traditional corporate design approach that may feel less intuitive to younger workforces accustomed to consumer-grade software experiences.

Navigation and Workflow Efficiency

The efficiency of completing common payroll tasks can significantly impact your experience with either platform. Understanding how each system structures its workflows helps determine which might better align with your team's preferences and technical comfort level:

• Gusto workflow highlights: Intuitive setup wizard for new businesses, visual step-by-step payroll process, automated tax filing confirmations, and contextual help throughout the platform.
• ADP workflow highlights: Customizable dashboard views, comprehensive reporting options, specialized industry workflows, and integrated compliance checks throughout the process.

First-time payroll administrators often find Gusto's guided approach more welcoming, with clear instructions and helpful tooltips explaining unfamiliar terminology. Experienced payroll professionals may prefer ADP's more comprehensive toolset, which offers greater customization and detailed controls over every aspect of the payroll process. Your choice may ultimately depend on your team's technical comfort level and preference for either streamlined simplicity or comprehensive functionality.

How HR Capabilities Extend Beyond Basic Payroll

Both platforms extend well beyond basic payroll processing to offer valuable HR functionalities, though with different approaches and strengths. ADP Run provides an impressive array of HR tools, especially in its higher-tier plans, including an employee handbook wizard pre-populated for your state, job description templates, and access to ZipRecruiter for posting open positions. Their Complete and HR Pro plans offer HR tracking tools, document storage, and compliance alerts to keep your business updated on changing regulations.

Gusto takes a more integrated approach to HR, building essential functions directly into its core platform. Even at its base tier, Gusto includes employee onboarding, document storage, and basic time-off management. The Plus plan adds more robust time tracking, PTO approval workflows, and the ability to create and send custom offer letters for electronic signature, while the Premium plan provides access to certified HR professionals and custom employee handbooks.

Where ADP distinguishes itself is through additional employee benefits like discount programs for brand-name products and daily essentials, as well as access to free and discounted legal services through third-party providers. Gusto counters with its intuitive employee directory and unique team survey tools that help gauge employee satisfaction and engagement, creating a more modern, culture-focused workplace experience that resonates with many small business owners.

Employee Onboarding and Management Tools

The employee lifecycle begins with onboarding, and both platforms offer digital solutions to streamline this process. Effective onboarding tools save time, reduce paperwork, and create a positive first impression for new team members:

• ADP onboarding features: Digital I-9 and W-4 completion, background check integration, customizable onboarding checklists, and state-specific new hire reporting.
• Gusto onboarding features: Self-service employee information collection, digital document signing, automated welcome emails, and paperless onboarding workflows with progress tracking.

Beyond onboarding, both platforms offer tools to manage ongoing employee needs and documentation. Gusto's approach tends to focus on employee experience and engagement, with features like birthday reminders and work anniversary celebrations built into the platform. ADP provides more comprehensive compliance documentation and tracking tools, particularly valuable for businesses in highly regulated industries or those with complex workforce management requirements.

What Benefits Administration Options Are Available?

Benefits administration represents another area where these platforms take different approaches to solving small business challenges. ADP offers extensive benefits management capabilities through affiliated services like Automatic Data Processing Insurance Agency (ADPIA), allowing businesses to explore, secure, and manage workers' compensation, business insurance, and group health insurance based on their specific needs. ADP also provides a range of retirement plan options that integrate with their payroll system.

Gusto offers a more streamlined benefits administration approach with direct access to health benefits in 38 states and Washington, D.C. Their platform connects businesses with licensed benefits advisors who help create customized health insurance packages, charging only the insurance premiums with no additional administration fees to enroll in workers' compensation or health benefits. Their offerings include health, dental, vision, 401(k) retirement plans, HSAs, FSAs, commuter benefits, and life and disability insurance options.

A unique Gusto advantage is the Gusto Wallet app, which helps employees track earnings and build savings goals, extending beyond traditional benefits administration to support employee financial health. ADP, meanwhile, offers more extensive global benefits management capabilities for businesses with international operations. Your choice between these platforms may depend on your geographic location, the diversity of benefits you wish to offer, and whether you already have established relationships with benefits providers.

Financial Wellness and Retirement Options

Both platforms recognize the growing importance of financial wellness programs in attracting and retaining talent. These features help employees manage their finances more effectively while simplifying administration for employers:

• ADP financial wellness tools: Multiple retirement plan options, financial education resources, employee discount programs, and integration with major financial institutions.
• Gusto financial wellness tools: Gusto Wallet app with savings features, Cashout for early wage access, automated savings programs, and integrated financial education resources.

Retirement plan administration represents a significant consideration for many businesses. Gusto offers a straightforward 401(k) integration through their platform, with transparent pricing and simplified administration. ADP provides more diverse retirement options, including 401(k), SIMPLE IRA, and SEP plans, with greater customization capabilities but potentially higher administrative costs. Businesses with specific retirement plan requirements may find ADP's flexibility advantageous, while those seeking simplicity might prefer Gusto's streamlined approach.

How Reliable Is Customer Support When You Need Help?

The level and quality of customer support can make or break your experience with any software platform, especially one handling something as critical as payroll. ADP provides 24/7 live support across all its plans, ensuring that help is available whenever issues arise. Their support team includes certified, experienced payroll professionals accessible via phone or email, with higher-tier plans including dedicated support representatives who become familiar with your specific business needs.

Gusto offers more limited support hours, available Monday through Friday from 6 a.m. to 5 p.m. Pacific Time. Support is accessible via phone, email, and chat, with priority support offered to Premium users and available as an add-on for Plus customers. While Gusto's support isn't available around the clock like ADP's, many users report high satisfaction with the quality of assistance they receive during business hours, citing friendly and knowledgeable representatives.

Both companies provide extensive online resources to help users troubleshoot problems independently. ADP offers an extensive knowledge base, webinars, and training materials developed from decades of payroll expertise, while Gusto counters with an intuitive help center, step-by-step guides, and educational content designed for small business owners who might not have payroll expertise. Your preference may depend on your comfort level with payroll management and whether your business operations require support outside standard business hours.

Self-Service Resources and Training Options

Beyond direct support channels, both platforms offer resources to help users become more self-sufficient with their payroll systems. These self-service options can significantly reduce dependency on support teams for routine questions:

1. Research the platform's knowledge base thoroughly before contacting support for faster resolution.
2. Take advantage of any available training webinars or video tutorials to master complex features.
3. Bookmark frequently used help articles for quick reference during payroll processing.
4. Consider designating a secondary payroll administrator who can provide internal support.

ADP's resources tend to be more technical and comprehensive, reflecting their enterprise background and the complexity of their system. Gusto's help content focuses on accessibility and clear explanations, making it particularly valuable for small business owners new to payroll management. Both platforms regularly update their knowledge bases to reflect new features and address common questions, though Gusto typically implements a more conversational tone that resonates with small business users.

How Well Do These Systems Integrate With Other Tools?

The ability to connect your payroll system with other business software is increasingly important for streamlining operations and reducing duplicate data entry. ADP Run offers extensive integration capabilities, connecting with over 300 business applications including ERPs, accounting solutions, time-tracking tools, point of sale systems, and productivity platforms. Their marketplace includes integrations with popular software like Xero, QuickBooks, Oracle, and Slack, creating a cohesive business technology ecosystem.

Gusto also prioritizes integration capabilities with connections to dozens of popular business applications spanning accounting software (QuickBooks, Xero, FreshBooks), time tracking platforms (Homebase, TSheets), point of sale systems, business operations tools, and expense management solutions like Expensify. While Gusto offers fewer total integrations than ADP, they cover most essential small business applications and typically feature deeper, more seamless connections with the tools they do support.

A significant ADP advantage is their single invoice billing that combines payroll and complementary partner services, simplifying expense management. They also offer over 30 partner app connectors specifically for point of sale solutions, making them particularly valuable for retail and restaurant businesses. Gusto, while more limited in specialized integrations, focuses on creating exceptionally smooth workflows with the most common small business tools that many owners already use.

Accounting Software Connections

Accounting integration represents one of the most critical connections for any payroll system, eliminating duplicate data entry and ensuring financial records remain accurate and up-to-date. Both platforms offer robust accounting software connections, though with different approaches:

• ADP accounting integrations: QuickBooks (Desktop and Online), Xero, Wave, Sage Intacct, and custom general ledger exports for other systems.
• Gusto accounting integrations: QuickBooks (Online and Desktop), Xero, FreshBooks, Aplos, and CSV exports for other accounting platforms.

The depth and quality of these integrations can vary significantly. Gusto's QuickBooks Online integration receives particularly high marks for its seamless two-way sync capabilities and detailed transaction mapping. ADP offers broader compatibility with enterprise accounting systems, making it potentially more valuable for businesses planning significant growth or those using specialized accounting platforms. Your existing accounting setup should heavily influence which payroll system might integrate most effectively with your financial processes.

How Do These Platforms Handle Compliance and Security?

Compliance and security represent critical considerations when selecting a payroll provider, as mistakes can lead to costly penalties and data breaches can expose sensitive employee information. ADP brings 75+ years of payroll experience to compliance management, offering advanced state unemployment insurance management tools, claim responses, benefit payments review, and best practices consulting. Their systems automatically adapt to changing regulations across jurisdictions without requiring third-party involvement.

Gusto maintains strong compliance capabilities despite being a newer entrant in the market, automatically calculating, filing, and paying federal, state, and local taxes with every payroll run. Their system handles wage garnishments and state new-hire reporting at no additional charge, while their Premium plan includes compliance alerts and access to HR experts who can provide guidance on complex regulatory questions, though this advanced support isn't available in lower-tier plans.

Both providers maintain robust security measures to protect sensitive payroll data, employing industry-standard encryption, regular security audits, and strict access controls. ADP, with its longer history serving enterprise clients, has developed particularly sophisticated security protocols and disaster recovery capabilities. Both platforms offer secure employee self-service portals that protect personal information while allowing convenient access to pay stubs and tax documents, though businesses in highly regulated industries may find ADP's more comprehensive compliance toolset offers additional peace of mind.

Tax Filing Guarantees and Liability Protection

Both platforms offer guarantees regarding the accuracy and timeliness of tax filings, though with important distinctions in coverage and implementation:

1. Verify the specific tax guarantee terms before selecting a provider to understand your protection.
2. Consider whether state and local taxes are included in the guarantee or just federal filings.
3. Understand the process for resolving tax filing errors and who bears responsibility for communication.
4. Evaluate whether the guarantee covers both penalties and interest or just the penalty portion.

ADP's tax filing guarantee reflects their extensive experience in compliance management, covering a wide range of potential issues across federal, state, and local jurisdictions. Gusto's guarantee provides comprehensive protection for the taxes they file on your behalf, though their coverage in certain specialized local tax jurisdictions may be more limited. Both providers assume liability for errors they make in calculating or filing taxes, providing significant peace of mind compared to handling payroll manually.

Which Payroll System Is Right For Your Business?

After thoroughly examining ADP Run and Gusto across multiple dimensions, it's clear that both platforms offer compelling solutions for small business payroll needs, but with distinct advantages that will appeal to different types of organizations. Your ultimate decision should align with your business's specific requirements, growth trajectory, and operational priorities rather than simply choosing the most popular option.

ADP Run stands out as the preferred choice for businesses with complex payroll needs, multiple state operations, or plans for significant growth. Its robust compliance tools, 24/7 support, extensive HR capabilities, and decades of industry experience make it well-suited for businesses that prioritize comprehensive features and expert guidance. While its pricing is less transparent and typically higher than Gusto's, many businesses find the additional capabilities and peace of mind worth the investment, particularly those with regulatory complexities or specialized industry requirements.

Gusto emerges as the ideal solution for small to medium-sized businesses seeking an intuitive, modern approach to payroll and HR at a transparent price point. Its user-friendly interface, unlimited payroll runs, included tax filings, and integrated HR tools make it especially attractive for startups and growing businesses without dedicated payroll personnel. Gusto's strengths in automation, employee experience, and straightforward pricing make it particularly valuable for businesses that value simplicity and modern design while still receiving solid compliance support and core payroll functionality.

Making Your Final Decision

When making your final selection, consider these practical steps to ensure you choose the platform best suited to your specific business needs:

• Assess your complexity level: Evaluate how many states you operate in, whether you have specialized pay types, and if you need industry-specific payroll solutions.
• Consider your growth plans: Choose a platform that can scale with your business over the next 3-5 years without requiring a migration to another system.
• Evaluate your technical comfort: Be honest about your team's technical abilities and whether you prefer simplicity or comprehensive features.
• Request demos of both platforms: Experience the user interface firsthand and ask specific questions about how each system handles your unique payroll scenarios.

Consider your business's size, complexity, budget, and growth plans when making your selection. For many small businesses, Gusto's combination of simplicity, value, and modern features makes it the preferred choice, while organizations with more complex needs often find ADP's comprehensive capabilities worth the higher investment. Whichever platform you choose, both represent significant improvements over manual payroll processing and will help streamline one of your business's most essential functions.