ADP VS Gusto: The Honest Comparison Nobody Else Will Give You

Let's Get Real: The Core Difference

This isn't just about features—it's about fundamentally different business models and philosophies.

ADP (Automatic Data Processing) was founded in 1949. They process payroll for 1 in 6 American workers. They're the definition of "enterprise software"—powerful, comprehensive, and built for scale. If your business has complex needs (multi-state, union workers, prevailing wage, garnishments), ADP has seen it all a million times.

Gusto launched in 2012 (as ZenPayroll) to make payroll "delightful." They're the modern, cloud-native alternative built specifically for small businesses. Transparent pricing, beautiful UX, self-service onboarding. They want you up and running in a day, not a month.

When ADP Makes Sense (Spoiler: It's About Scale)

1. You Have Over 100 Employees

At 100+ employees, ADP's enterprise features start to matter. You need:

• Complex org hierarchy management
• Multi-location, multi-state payroll with different pay cycles
• Advanced reporting and compliance tools
• Integration with enterprise HRIS (Workday, SuccessFactors)
• Custom workflows for approvals and exceptions

Gusto can technically handle 100+ employees, but it's not their sweet spot. Their premium tier adds more features, but you'll start feeling the limitations.

2. Complex Payroll Scenarios

If you have any of these, ADP is the safer bet:

• Union workers: ADP handles union dues, certified payroll, prevailing wage
• Tipped employees: Both can do it, but ADP's flows are more robust
• Multi-state nexus: Both handle it, but ADP's compliance team is deeper
• Construction/project-based labor: ADP has job costing and labor distribution
• Time clock integration: ADP partners with biometric systems, geofencing, badges

3. You Want a Dedicated Support Rep

With ADP, you get a dedicated payroll specialist. You have their direct phone number. When you call, they know your business, your history, your quirks. For companies with complex payroll, this human touch is worth the cost.

Gusto's support is excellent (email, chat, help docs), but you don't get a dedicated person. For most small businesses, this is fine. But if you're running a 200-person manufacturing plant, you might want that direct line.

4. Enterprise Integrations

ADP integrates deeply with enterprise systems like:

• Workday, Oracle, SAP
• NetSuite, Sage Intacct
• Kronos, UKG (Ultimate Kronos Group)
• Industry-specific ERPs (construction, healthcare, retail)

Gusto integrates with QuickBooks, Xero, and popular SMB tools. If you need SAP integration, you're in ADP territory.

When Gusto Is the Obvious Choice

1. You're Under 100 Employees (Especially Under 50)

For small businesses, Gusto is purpose-built. You get:

• Full-service payroll with automatic tax filing (federal, state, local)
• Built-in benefits administration (health, dental, 401(k), FSA, commuter benefits)
• Time tracking and PTO management
• Onboarding and offboarding workflows
• Compliance tools (new hire reporting, W-2s, 1099s)

All of this is included in their Plus plan ($80/mo base + $12/employee). With ADP, you'd be buying these as separate add-ons at a premium.

2. You Want to Know What You're Paying

Gusto's pricing is public:

• Simple: $40/mo + $6/employee (payroll only)
• Plus: $80/mo + $12/employee (adds benefits, HR tools)
• Premium: Custom (for 100+ employees, adds dedicated support)

Example: 25 employees on Plus = $80 + (25 × $12) = $380/month

ADP doesn't publish pricing. You call, they send a sales rep, you negotiate. Based on industry data:

• ADP Run (small business): ~$59/mo base + $4-10/employee (varies wildly)
• ADP Workforce Now (midsize): ~$100-200/mo base + $8-15/employee

Example: 25 employees on ADP Run = ~$79 + (25 × $8) = ~$279/month (base payroll only, no benefits)

So ADP can be cheaper—but only if you don't need benefits admin, HR tools, or premium features. Once you add those, costs balloon and you're often paying more than Gusto with less transparency.

3. Modern UX Actually Matters to You

Let's not sugarcoat it: ADP's interface looks like it was designed in 2005. It works. It's functional. But it's not pleasant.

Gusto's UI is clean, intuitive, and mobile-first. Your employees can:

• Check pay stubs and W-2s on their phone
• Update direct deposit and tax withholdings in seconds
• Enroll in benefits with a guided flow
• Request PTO and see their accrual balance

If you care about employee experience (and you should—it reduces admin questions), Gusto wins by a mile.

4. Benefits Administration Is Important

Gusto includes benefits admin in their Plus plan. They're also a licensed insurance broker, so they can help you shop for health insurance, set up a 401(k) (with partners like Guideline and Human Interest), and manage FSAs/HSAs.

ADP offers benefits too, but it's usually a separate product ("ADP TotalSource" for PEO, or "ADP Marketplace" for brokerage). More complexity, more costs.

5. You Want Self-Service Setup

With Gusto, you can sign up today and run payroll tomorrow. No sales calls, no implementation process. Just create an account, add employees, connect your bank, and go.

ADP requires an implementation process—calls with a rep, data migration, configuration. This is thorough (good for complex businesses), but if you need payroll this week, Gusto is your move.

Pricing Deep Dive (The Part ADP Doesn't Want You to See)

What You Actually Pay

Let's compare real-world costs for a 50-person company:

Gusto Plus (Full-Featured)

• Base: $80/month
• Per employee: 50 × $12 = $600
• Total: $680/month

Includes: Payroll, tax filing, benefits admin, time tracking, HR tools, onboarding, compliance

ADP Run (Small Business)

• Base: ~$79/month (negotiated)
• Per employee: 50 × $8 = $400
• Base payroll: ~$479/month

But to match Gusto's features, add:

• Benefits admin: +$200-300/mo
• Time & attendance: +$100-150/mo
• HR tools: +$150-200/mo

Total with add-ons: $929-1,129/month

Reality: For small businesses wanting a full-featured solution, Gusto is usually cheaper and includes more.

The Hidden Costs of ADP

• Implementation fees: $500-2,000 (Gusto is free)
• Annual price increases: ADP typically raises rates 5-10% annually
• Change fees: Want to add a module mid-year? Expect a fee
• Support tiers: Better support costs more

Customer Support: The Real Differentiator

ADP Support

• Dedicated rep: You get a payroll specialist assigned to your account
• Phone support: Call them directly during business hours
• 24/7 line: Emergency support available (but you get whoever is on shift)
• Depth: They've seen every edge case

Downside: Your rep quality varies. Some are great, some are overwhelmed with 100+ clients.

Gusto Support

• Email & chat: Fast response times (usually within an hour during business hours)
• Help center: Excellent self-service docs, videos, and guides
• Phone (Premium only): If you're on Premium, you get phone support
• Quality: Knowledgeable and friendly, but not as deep on complex edge cases

Reality: For 90% of small businesses, Gusto's support is more than adequate. If you have truly complex payroll (union, prevailing wage, multi-country), ADP's depth matters.

Real-World Switching Stories

Common Reasons People Switch FROM ADP to Gusto:

• "The interface was painful for our employees"
• "Annual price increases were getting ridiculous"
• "Our dedicated rep left and the replacement was overwhelmed"
• "We wanted benefits included, not as a separate add-on"
• "Setup took 6 weeks—we needed something faster"

Common Reasons People Switch FROM Gusto to ADP:

• "We grew past 150 employees and needed more enterprise features"
• "We have union workers and Gusto couldn't handle it"
• "We needed deeper time tracking and labor distribution"
• "We wanted a dedicated rep we could call"
• "We needed integration with our enterprise ERP"

Integration Ecosystems

Gusto Integrations

Gusto integrates with 100+ apps:

• Accounting: QuickBooks, Xero, FreshBooks
• Time tracking: TSheets, Homebase, Deputy, When I Work
• HRIS: BambooHR, Namely, Zenefits
• Benefits: Guideline, Human Interest, Justworks
• Expense: Expensify, Divvy

ADP Integrations

ADP integrates with enterprise systems:

• Accounting: QuickBooks, Sage, NetSuite, SAP
• Time: Kronos, UKG, ADP's own time clocks
• HRIS: Workday, Oracle, SAP SuccessFactors
• Benefits: ADP's own ecosystem

Reality: If you're a small business using QuickBooks and Slack, Gusto's integrations are perfect. If you're running SAP and Workday, you're in ADP's wheelhouse.

Compliance & Tax Accuracy

Both ADP and Gusto handle payroll taxes automatically. Both file federal, state, and local taxes. Both generate W-2s and 1099s. Both handle new hire reporting.

The difference:

• ADP has a legal team that's seen every edge case. Multi-state nexus? Union contracts? Prevailing wage? They've dealt with it thousands of times.
• Gusto handles standard scenarios flawlessly. Edge cases? Their support is good, but not as battle-tested.

For 95% of small businesses, this difference doesn't matter. If you're in that 5% with truly complex needs, ADP's depth is worth paying for.

The Bottom Line