Zenefits vs Gusto: Comparing Features, Pricing and Usability

Gusto and Zenefits are cloud-based HR management systems (HRMSs) geared to small and mid-size businesses. These solutions offer HR services, including payroll, benefits and compliance to help businesses operate more efficiently by reducing paperwork and simplifying time-intensive tasks.

Product Overviews

Here’s some information from our Gusto and Zenefits reviews that summarize each product:

Gusto: Gusto combines payroll, benefits administration, compliance and other HR features in one, simplified package. It enables companies to set up payroll automatically via its Payroll on AutoPilot feature.

The solution also handles tax filings and payments so businesses don’t have to worry about being compliant. Additionally, Gusto offers employee self-onboarding, e.g., employees can fill out payroll and benefits forms online themselves.

Zenefits: Zenefits is an online HR suite that creates a central cloud-based hub for all employee data. The online platform connects all HR tools and services to one, easy-to-use dashboard, improving efficiency by automating processes, reducing repetition and eliminating the need for paperwork. Zenefits also offers a business and health insurance brokerage service.

The HRMS allows businesses to streamline their benefits management and easily complete tasks, including open enrollment, online renewal, viewing plans and costs, and printing insurance cards.

How They Stack Up:

Ease of Set Up and Use

Gusto: Gusto offers a modern and intuitive user interface. An eight-step guided process helps firms set up the system. Gusto’s customer support reps can be reached via live chat within the system.

Gusto offers self-onboarding so employees can enter their personal information themselves, such as contact details, Social Security numbers and tax withholding information.

Zenefits: Zenefits offers customers online resources to help them get up and running. The vendor has implementation services to provide additional guidance and support to companies that want to “fine tune” their Zenefits’ configurations.

To begin the onboarding process for new hires, HR professionals just have to complete five online fields. New hires can complete the forms online, including entering their tax withholding information and enrolling in benefits.

Benefits Administration

Gusto: Gusto’s intuitive dashboard and access to licensed advisers makes it easy for customers to process and manage benefits, whether they import their existing benefits plans or create new ones tailored to their needs. Benefits administration features include employment tax reporting and payment, comp insurance, hire/leave reports and detailed budget plans.

Zenefits: Zenefits specializes in simplifying benefits management through an online portal. Customers can find resources and quotes, update information, minimize compliance risks and keep up to date with the latest legislation all in one place. In addition, Zenefits makes hiring, onboarding and employee records management easier to understand and accomplish.

Automated Payroll Management

Gusto: Gusto lets employers set up and schedule payments automatically, eliminating human error and allowing employees to get paid on time. In an effort to reduce paper waste, digital paystubs are emailed to employees.

The system can also automate the calculation, payment and submission of a company’s local, state and federal payroll taxes.

Zenefits: Zenefits Payroll integrates with the other apps a company manages on the Zenefits platform, e.g., HR, benefits, compliance and attendance. The system automatically updates the company’s payroll as changes are made.

With Zenefits, companies can enter and approve employee’s time data, reduce errors and ensure their hourly employees are paid accurately and on time. Zenefits handles a company’s taxes automatically, from processing W-2s to filing federal and state taxes.

Pricing

Gusto: Gusto offers three pricing tiers: Core, Complete and Concierge. The Core tier costs $39 per month plus $6 per employee, and includes all payroll features, employee self-service, employee profiles (such as electronically signing I-9 and W-4 forms), benefits, workers comp and unlimited phone, email and chat support.

The Complete tier also has a base rate of $39 per month but the per-employee price is $12. It adds onboarding, time-off requests, employee directory and employee surveys features. Finally, the Concierge tier has a base rate of $149 per month plus $12 a month per employee. Additional features are an HR resource center, advice from certified HR experts and access to a dedicated support team for faster support.

Gusto offers additional options for employee benefit and insurance. Its 401(k) retirement plan costs $39 per month minimum to participate, plus $8 per participant per month. The 529 college savings plan is priced at $18 per month plus $6 per participant per month. Gusto offers an annual $200 service charge that covers health spending accounts (HSA), flexible spending accounts (FSA) and commuter benefits. However, for companies that rather purchase each plan individually, HSA is $2.50 a month per participant, and FSA and commuter benefits each has a $20 a month minimum and $4 a month per participant.

Zenefits: Zenefits also offers three levels of pricing: Essentials, Growth and Zen. The Essentials plan costs $10 per employee per month and includes an HR platform, time and attendance, scheduling, compliance, mobile app, PTO tracking and App connect (ability to integrate Zenefits to third-party applications). The Growth plan costs $18 per employee per month, and includes additional features, such as compensation management and performance management. The Zen plan ($27 per employee per month) includes the Well being features that that help companies measure employees’ well being.

Zenefits offers optional payroll ($6 per user, per month), benefits ($5 per employee per month if company wants to use their existing broker; free for companies that use a broker from Zenefits’ partner network) and advisory services ($10 per employee per month).

Security

Gusto: Gusto offers “ultra-secure web encryption.” Data is transmitted using 256-bit SSL, the highest encryption standard available. Gusto protects all the account information customers provide, including passwords and employees’ personal details, using this technology.

The system stores backups, which are updated throughout the day, every day, in numerous secure locations. Companies can also choose to add an extra layer of security to their accounts with two-step authentication.

Zenefits: Zenefits uses state-of-the art encryption technology, transferring data with high-grade TLS (Transport Layer Security) and multi-layered encryption at rest with AES-128. The TLS protocol provides privacy and data integrity between two applications that communicate with each other. AES (Advanced Encryption Standard) is used to secure sensitive files sent over the Internet. Encryption keys are kept in different locations than the data, which is hosted within a secure, off-site, cloud-based infrastructure.

Access to sensitive data requires two-factor authentication by authorized users. The server hosting locations are physically guarded around the clock by trained security personnel.

Bottom Line

When it comes to the features of their systems, Gusto and Zenefits are pretty comparable. However, what really sets these companies apart is their pricing structures. While both vendors offer pricing tiers, Zenefits’ plans are cheaper as its pricing is based on a per-employee/per-month strategy. Gusto, on the other hand, has a bate rate plus a per-employee/per-month strategy.

The key, though, is to evaluate each solution to determine what best fits your company’s needs.

If you’re entirely new to HRMS tools, take a look at our HRMS Definitive Guide. It offers a full overview of market trends, must-have features and common challenges to avoid.

Finally, if you’re looking for software alternatives, our detailed reviews is a good place to start.

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