Managing human resources effectively is often a huge challenge for companies. As a result, they constantly search for solutions to manage payroll, attendance, and employee benefits that strike a balance between ease of use, efficiency, and functionality. Choosing the right HR platform can address these problems by enabling businesses to focus on growth and employee well-being.  

Gusto and ADP are two popular platforms that have established themselves as key players in the market. While both have powerful HR capabilities, they serve different business needs. Gusto offers simplicity and focuses on small to medium-sized businesses, while ADP delivers comprehensive, scalable solutions for larger organizations with more complex HR requirements.  

Here, we will compare Gusto and ADP in detail, highlighting their features, pros, and cons, helping you determine which platform is best for your organization.  

Comparing Gusto Vs ADP: At A Glance

Features 

Gusto 

ADP

Payroll 

US-based, automated payroll calculations, tax filings, and direct deposits 

Global payroll calculations, tax withholdings, overtime estimation, and benefit deductions 

Time And Attendance Tracking 

Employee hour tracking, real-time reporting, time and cost-saving tools, integrated time tracking, and time-off requests 

Integrated scheduling, timekeeping, attendance management, real-time data tracking, employee clock-ins, clock-outs, and departmental transfers 

Hiring And Onboarding 

Job posting, custom offer letters, custom onboarding checklists, integrated HR processes 

Recruitment, applicant tracking, job postings, candidate evaluations, background checks, and more

Benefits Administration 

Health insurance, automated savings, 401(k) plans, and more 

Health insurance, retirement programs, streamlined enrollment, compliance, and communication processes 

Talent Management 

Performance reviews, self-evaluations, manager reviews, career development resources 

Compensation modules for over 42 million employees, equity payments, bonuses, merit increases, and stock awards 

Pricing 

Starting price: $40/month, plus $6/month/person 

Custom pricing plans based on business size and needs 

What Is Gusto?

Gusto is a cloud-based software that simplifies human resources, benefits, and expense management for business organizations. The software helps automate payroll processing, like tax filings and direct deposits, resulting in accurate and timely employee payouts. Gusto provides hiring and onboarding capabilities like customizable checklists and document e-signatures. Startups can use these features to quickly onboard a growing team without manual paperwork, while small businesses can maintain a professional hiring process with minimal HR staff. Additionally, by providing employee benefits, including health insurance and retirement plans, Gusto ensures compliance with labor laws. This is particularly beneficial for companies expanding their workforce or those aiming to improve employee satisfaction.  

Gusto also offers time tracking, performance reviews, and employee engagement surveys, providing businesses with more comprehensive HR management. Its integration capabilities with other applications and user-friendly design make it a great option for businesses wanting to efficiently handle their human resources processes.  

Unique Features

Research And Development Tax Credits: This feature enables businesses to identify and claim federal R&D tax credits. It helps streamline expense analysis, integrate with payroll for credit applications, and provide expert CPA assistance and audit support to reduce innovation costs 

Gusto Wallet: This free mobile app for employees offers features to manage finances, monitor spending, set savings goals, and access paychecks. It offers features like early paycheck access, budgeting tools, and the ability to define multiple savings goals 

Integrated Accounting Sync: It streamlines the transfer of payroll and HR data to popular accounting software like QuickBooks and Xero, resulting in real-time updates and fewer manual entry errors. This enhances financial reporting and operational efficiencies 

Pros And Cons 

Pros 

  • Its reliable payroll services ensure employees are paid timely and accurately
  • The streamlined new hire onboarding helps simplify administrative tasks
  • Gusto's automated tax calculations and filings reduce the risk of errors 

Cons 

  • Some users report occasional payroll processing delays 
  • Correcting mistakes within the system can be challenging 

What Is ADP?

ADP is an integrated human capital management (HCM) software that combines payroll, human resources, time and attendance, talent management, and benefits administration into a single platform. The software automates payroll calculations, tax filings, and compliance tracking to help businesses reduce administrative costs. Startups can streamline complex payroll processes as they scale, while small businesses ensure accurate compliance management without extensive HR resources.  

Its user-friendly interface and extensive analytics provide actionable insights to support strategic HR decisions, making it an excellent choice for organizations seeking improved productivity and employee engagement. ADP provides time and attendance features to assist with managing labor costs and ensuring compliance with labor regulations. Its talent management features facilitate recruitment, performance reviews, and staff development, thereby attracting and retaining top talent.  

Unique Features

  • PEO Agreement Services: Administered via ADP TotalSource, the feature provides a comprehensive support to outsource HR solutions for small and medium-sized enterprises, including payroll processing, benefits administration, compliance support, and risk management. The PEO model enables businesses to simplify time-consuming HR tasks while maintaining expert guidance and competitive employee benefits 
  • Candidate Data Pool: ADP provides certified benchmarking data from over 42 million employees, enabling organizations to make informed hiring decisions. It assists businesses in understanding competitive compensations, attracting top talent, and assessing their performance against competitors based on location, role, and company size 
  • ADP Assist: ADP Assist is an AI-powered technology that improves HR management by automating regular tasks and offering strategic insights. It provides personalized information, evaluates payroll data, prepares reports, and assists employees in accessing important resources to streamline HR operations 

Pros And Cons 

Pros

  • Easy to edit and customize reporting tools 
  • Compliance support with ACA and other labor regulations reduces compliance risks
  • Data encryption and access controls aid in safeguarding sensitive employee data 

Cons 

  • Integration with third-party apps can sometimes need custom coding 
  • Administrator intervention is required for employees to access all of their information

Gusto Vs ADP: Key Features Comparison

1. Payroll

Gusto provides a complete set of tools for streamlining payroll processing for US-based organizations of all sizes. It streamlines payroll calculations, tax filings, and direct transfers to ensure accuracy and compliance with federal, state, and local regulations. The software supports unlimited payroll runs, allowing businesses to process payroll whenever required at no additional expense. Gusto also works with multiple accounting tools, allowing for effortless synchronization of financial data.

ADP offers automated payroll management with various solutions suitable for businesses of all sizes. It manages international payroll calculations, like tax withholdings, overtime estimation, and benefit deductions, making it ideal for multinational corporations operating across borders. Employers have multiple payment options, including direct deposit, prepaid debit cards, and printed checks. It can also link payroll with time-tracking systems to ensure seamless processing. ADP also handles federal, state, and local tax filings, which reduces potential errors and penalties.

Winner: It's a tie, as Gusto is a great option for US-based, small-to-medium businesses for its affordability, simplicity, and employee-friendly features. In contrast, ADP offers the scalability and extensive capabilities required by larger enterprises or those with global and complicated needs.

2. Time And Attendance Tracking

Gusto's integrated time tracking and time-off request tools help small businesses save time by automating manual processes and making workforce management easier. It provides accurate reports for employee hour tracking, real-time workflow updates, and resource allocation.

ADP offers an integrated platform for scheduling, timekeeping, and attendance management. The system tracks data in real-time, including employee clock-ins, clock-outs, and departmental transfers. It sends it straight to ADP's payroll administration system, reducing manual errors and saving time.

Winner: ADP’s time and attendance feature has a slight edge due to its comprehensive real-time data tracking and seamless integration with its payroll management system, which improves accuracy and efficiency.

3. Hiring And Onboarding

Gusto offers hiring and onboarding features, including tools for creating public job posts, personalized offer letters, and custom onboarding checklists. It facilitates software provisioning for new hires, allowing organizations to quickly set up the necessary tools. The platform integrates with various HR processes, offering a cohesive experience from recruitment to employee management.

ADP's hiring and onboarding feature provides comprehensive talent acquisition solutions, including recruitment, applicant tracking, and seamless integration with HR systems. It simplifies the hiring process by automating tasks like job postings, candidate evaluations, and background checks, resulting in a seamless transition from candidate to employee.

Winner: ADP's hiring and onboarding feature takes the lead for its comprehensive talent acquisition solutions. It includes recruitment, applicant tracking, and seamless integration with HR systems, making it a more extensive solution for businesses seeking end-to-end hiring.

4. Benefits Administration

Gusto's benefits administration feature gives small businesses access to health insurance, automated savings, 401(k) plans, and more. It integrates benefits management with payroll and HR operations, making the process easier for both businesses and employees.

On the contrary, ADP offers benefits administration features enabling large organizations to provide competitive perks like health insurance, retirement plans, and more. It streamlines the enrollment, compliance, and communication processes, allowing employees access to essential benefits information and services.

Winner: Gusto is the winner in this category. Both ADP and Gusto provide advanced benefits administration features that are tailored to diverse corporate requirements. Gusto excels at benefits administration for small and medium-sized enterprises, providing a simple, user-friendly interface and easy access to benefits, including health insurance, workers' compensation, and retirement plans.

5. Talent Management

Gusto's talent management feature aims to improve employee performance through structured reviews and development tools. It offers an automated workflow for performance reviews, which includes self-evaluations, manager reviews, and career development resources. This provides insights into team performance by highlighting areas of excellence and chances for improvement, encouraging a culture of continuous development.

On the other hand, ADP provides a comprehensive set of tools for optimizing employee performance and development. It features compensation modules that analyze data from more than 42 million employees to help balance pay equity, bonuses, merit increases, and stock awards. This data-driven approach empowers businesses to make better decisions about hiring, retaining, retaining, and developing top talent.

Winner: It is a tie. Both platforms provide robust talent management tools tailored to varied company needs. ADP offers a data-driven approach with broad market insights, which is ideal for larger organizations looking for comprehensive compensation solutions. Gusto focuses on performance assessments and development tools, which are perfect for small and medium-sized businesses looking to improve employee performance and growth.

Summing It Up: Gusto Or ADP?

When comparing Gusto vs ADP, it is clear that both platforms provide robust solutions intended for distinct business needs. Gusto is known for its simplicity and user-friendly interface, making it a perfect option for small and medium-sized organizations. ADP stands out for its scalability, advanced features, and comprehensive solutions designed for larger businesses with complex HR and payroll needs.

In the end, the decision between Gusto and ADP is based on the business size, complexity, and specific needs. Both platforms offer distinct advantages, making them useful platforms for businesses looking to improve their HR operations and overall employee management. If you still want to look for more options, you can also explore BambooHR, Hirestream , or Workday HCM to find the perfect solution for your HR woes.