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A comparison of two leading payroll and HR software providers. Gusto is a cloud-based service that provides automation, flexibility and visibility into your business while Zenefits offers self-service and onsite implementation. Which one will prove most beneficial for the long term success of your company?
Gusto is a new company that has been compared to Zenefits, which is an established company. Gusto offers more features, but at the cost of being less intuitive than Zenefits.
Gusto and Zenefits are both cloud-based HR software that manage employee data, run payroll, and provide employer-sponsored benefits. Gusto includes payroll in its base plans, while Zenefits offers it as a paid add-on. However, Zenefits’ additional HR options (like performance and compensation management) are helpful if you want to appeal to top-tier talent plus have the resources to devote toward using the tools to manage employee growth and development. Meanwhile, Gusto is great if you need a solid solution just for running payroll for a small business (<100 employees) and complying with basic payroll regulations.
When Should You Use Gusto vs. Zenefits?
In certain cases, neither Gusto nor Zenefits are the ideal choice. Consider collaborating with Rippling if you’re seeking for a more customized solution to manage your HR and payroll requirements (or believe you may want to in the future). It will act as a co-employer, provide compliance advice, including what should be included in your policies, and provide you with competitive benefit prices that neither Gusto nor Zenefits can match. Rippling is ideal for organizations who want to expand in the future and want to be able to effortlessly switch off their PEO while maintaining access to their existing HR and payroll tools.
Pay a visit to Rippling
Overview of Gusto vs. Zenefits
Check out our guide to picking the best payroll provider for your company for additional information on what to look for when selecting a payroll service. If you’ve already made your choice and need to part ways with your existing payroll provider, see our article on how to switch payroll systems for tips on how to make the transfer go well.
Gusto and Zenefits both have similar features.
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- Calculations, payments, and submissions of payroll taxes are all automated.
- Keeping track of time
- Various pay rates and schedules are available.
- Reporting of tips
- Garnishments are helpful.
- Reporting on new hires
- Requests for paid time off (PTO) and approvals
- Electronic signatures and document management
- Digital offer letters and onboarding tools
- Employee polls
- Self-service for employees
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Pros and Cons of Gusto
Pros and Cons of Zenefits
Still not sure whether Gusto or Zenefits are the right match for you? See how both vendors stack up against our top-rated HR software for small companies.
Gusto Wins on Pricing
Gusto is the greatest value for businesses with less than 100 workers, since it includes HR tasks, an employee database, payroll processing, and benefits administration for a low monthly charge (monthly prices start at $39 + $6 per employee). Although Zenefits does not charge a monthly base price, its per-employee pricing is higher than Gusto’s, and the company’s minimum five-employee requirement and other payroll costs also factor in.
Let’s do the math: if you need to process the payroll of three employees, Zenefits’ basic Essentials plan ($10 per employee monthly) plus a payroll add-on ($6 per employee monthly) will cost you $80 per month (remember, there’s a 5-employee minimum, so you’ll be charged even if you don’t have the minimum). You simply have to pay $57 per month for three workers using Gusto.
However, if you only want basic HR, Keeping track of time, and scheduling, then consider Zenefits since its Essentials plan has all of these features and is affordably priced. In case your business is growing fast past 100 employees and you want an HR tool that includes compensation and performance management, Zenefits is a good option and may save you from having to upgrade or purchase additional software later (Gusto doesn’t have these features).
Pricing by Gusto
- Basic plan: $39 per month + $6 per employee
- Employee benefits, reporting, and onboarding tools are all included in full-service payroll, which includes unlimited and automated pay runs, payroll tax filings, two- and four-day direct payments, and full-service payroll.
- Complete tier: $39 per month + $12 per employee
- Has all of Core’s features plus next-day direct deposits, Keeping track of time, PTO management, Employee polls, permissions, and an employee directory
- Optional concierge service: $149 + $12 per employee every month
- All of the features of the Complete tier are included, as well as access to qualified HR professionals.
- Contractor-only plan: $6 per month for each contractor
- Add-ons:
- 401(k) plans start at $49 per month + $8 every employee who participates.
- College savings: $6 per participant every month, with a minimum of $18 per month.
- Commuter benefits: $4 per participant per month, with a minimum of $20 per month.
- HSA: $2.50 per month per participant
- FSA: $4 per month per participant
- Monthly health reimbursement: $15 per employee
- Health insurance is charged on an individual basis (pay only for premiums)
*Pricing for Zenefits
- Essentials plan: $10 per month per employee
- Includes core HR, Keeping track of time, scheduling, document management, onboarding, PTO tracking, reporting, and employee information management tools
- Monthly growth tier: $18 per employee
- In addition to all of the features of the Essentials plan, this plan includes remuneration and performance management.
- Monthly cost for the Zen option is $27 per employee.
- Has all of the features of Growth, as well as staff engagement surveys and a “People Hub” with collaboration tools and a business feed.
- Contractor-only plan: $6 per month for each contractor
- Add-ons:
- Payroll: $6 per month per employee
- Monthly HR consultation services are $10 per employee.
- Benefits management via a personal broker costs $5 per employee each month.
*A minimum of five workers is required for all Zenefits programs and add-ons. Annual subscriptions are also available at a discount from the supplier (billed in a lump sum).
Gusto Wins in the Payroll
Gusto absolutely excels when it comes to payroll. Gusto can handle payroll in all 50 states and offers automated tax filings and year-end W-2/1099 reporting in its payroll services, in addition to limitless and automatic pay runs. While Zenefits offers comparable pay processing features to Gusto, its payroll module is a paid add-on. In addition, unlike Gusto, Zenefits does not enable you to pay workers using pay cards, nor does it provide on-demand pay, which allows employees to receive their paychecks before payday.
Zenefits Wins in Human Resources
Although Gusto and Zenefits have similar HR features, Zenefits is a better choice, especially if you need Keeping track of time and scheduling. It includes the two features in all of its plans; Gusto only offers Keeping track of time in its higher tiers and it lacks employee scheduling capabilities. You can, however, opt to integrate Gusto with Homebase, which lets you create schedules and track employee attendance for free.
Another reason Zenefits outperforms Gusto in terms of HR tools is its comprehensive health benefits coverage (all 50 states against Gusto’s 39). Furthermore, only Zenefits provides HR-specific solutions like as performance management and pay planning.
Tools for Reporting: Tie
Gusto and Zenefits both include effective reporting features, including a set of basic reports and customization choices, as well as the ability to build new ones straight from their systems. You may design your own reports using specific fields or parameters and run basic reports with data about each person.
Gusto Wins in Ease of Use
Both Gusto and Zenefits provide user-friendly interfaces and online tools that are simple to understand and utilize. They also feature online tools such as how-to tutorials and FAQs. Gusto outperforms Zenefits in this category because to its broad integration possibilities with over 100 solutions (Zenefits only has 40+ integration partners) and its email, chat, and phone assistance.
Upgrade to Gusto’s Concierge option and you’ll get an unique phone number to call if you have any issues or need help using its features. Zenefits doesn’t have a dedicated phone number for its Zen plan members to contact assistance, but you may arrange a callback from its customer service staff via the Zenefits dashboard.
Users’ Opinions on Gusto and Zenefits
While both Gusto and Zenefits have average ratings of 4 or above on third-party review sites like as G2 and Capterra, Gusto’s score (4.5 vs 4) is greater as of this writing. Both applications are praised for being user-friendly and intuitive by reviewers. The delayed response times of their support staff were a popular issue for both Gusto and Zenefits, with many people focusing on Zenefits’ poor customer service.
The two providers received the following ratings on prominent user review sites at the time of publication:
Gusto
Zenefits
How Did We Compare Gusto vs. Zenefits?
Gusto versus Zenefits was rated on a 5-star scale based on six factors, including payroll and HR features, as well as cost, simplicity of use, and reporting tools. User evaluations from third-party sites like G2 and Capterra were also taken into account.
Gusto received a better overall rating of 4.66 out of 5, whereas Zenefits received a 4.19 out of 5 in our review. Click through the headings in the box below to see our complete assessment criteria.
25% of the overall score
Transparent pricing, many plan choices, limitless pay runs, and no setup costs were all considered positive features. Extra points were granted to companies who provide a monthly plan for less than $50 per employee. Gusto and Zenefits both meet all of our criteria for this area, although the former is more cost-effective ($39 + $6 per employee every month). Plus, unlike Zenefits, you don’t have to pay extra for payroll.
25% of the overall score
We searched for services like automatic payroll runs, payroll tax filing, 1099 form creation, several pay choices, and two-day direct transfers, to name a few. Providers that provide both employee and contractor payroll services, as well as a penalty-free guarantee, received bonus points. While both Gusto and Zenefits have effective pay processing capabilities, Gusto came out on top because it provides a variety of payment alternatives, including direct deposits, handwritten paychecks, and pay cards. Zenefits exclusively accepts direct deposit and paycheck payments.
25% of the overall score
Payroll software that connects with standard third-party systems (like QuickBooks, Homebase, and TSheets) is given bonus points in addition to having a user-friendly, intuitive, and flexible platform. We also looked for companies that could solve problems quickly and give live phone help. Gusto received good marks in this category because to its extensive list of third-party software connections and many customer assistance alternatives, including live phone service (which Zenefits does not provide).
10% of the overall score
Having access to a professional who can provide expert advice on compliance issues is one of the criteria we looked for, including new hire state reporting and Keeping track of time. Following closely behind these is the capability to provide online onboarding and employee benefits (like health insurance and workers’ compensation) that are available in all 50 states. Zenefits posted higher marks here because its Keeping track of time solution is already included in its base plan and the medical insurance options via its partner broker cover 49 states. With Gusto, you have to upgrade to at least its Complete tier to get Keeping track of time and its health insurance options are available only in 39 states as of this writing.
10% of the overall score
We looked at user evaluations on famous third-party websites such as G2 and Capterra. Providers with a 4+ star average and 1,000+ ratings are desirable. Gusto achieved a flawless grade in this category, with an average user rating of over 4 stars and over 1,000 online reviews, respectively.
5% of the overall score
Providers with customisable reporting and the ability to create new ones inside their payroll systems are scored positively in addition to offering standard payroll reports. Gusto and Zenefits both received a perfect score of 5 out of 5 for this category.
*Percentages based on total score
Conclusion
Gusto and Zenefits are both solid small business software products that can provide HR, payroll, and employee benefits in a self-service, cloud-based software. Zenefits is a good choice if you’re looking for an HRIS option that can grow with your business. But if you want an affordable way to pay employees while providing your workers with full benefits, onboarding tools, and basic Keeping track of time, Gusto is the HR and payroll software we recommend.
Gusto is a great place to visit.
The “rippling vs zenefits” is a question that many small business owners are asking. The two companies are both competing for the same market, so it can be difficult to choose which company to go with.
Frequently Asked Questions
Which is better Gusto or Zenefits?
A: Gusto is a much better company.
Is Gusto same as Zenefits?
A: No. Gusto is a free HR software that allows employees to create, update and manage their work schedules digitally. Zenefits was in the business of selling insurance but has since been banned from the United States
Does Gusto integrate with Zenefits?
A: Yes. Gusto is a third party vendor that works with Zenefits to provide Human Resources services such as payroll and benefits administration, pricing and labor management solutions.
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