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 (formerly ZenPayroll) 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 a simple pricing structure for payroll, benefits and HR – companies pay the base price plus an extra amount for every employee they want to enroll in payroll. The base price is $39 per month, plus $6 per month per employee. Gusto also offers a one-month free trial. Once the trial has ended, Gusto automatically debits the customer’s bank account each month.

Zenefits: Zenefits offers a two-tier pricing structure: Standard and Advanced. Standard is priced at $5 per month per employee, plus a base fee of $40 per month, including all the essentials for onboarding employees and managing HR. Advanced is $9 per month per employee, plus a base fee of $40 per month, including expanded compliance and HR for growing companies.

Zenefits accepts electronic bank transfers using ACH and all major credit and debit cards. Zenefits also offers a free Lite HR plan that includes hiring and onboarding, an employee directory and most of the company’s core HR apps.

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. And the advantage goes to Gusto because of its moderate pricing scheme. According to experts, Gusto is one of the few ACA-compliant systems that combine HR management and benefits administration so affordably.

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.

If you’re looking for software alternatives, our detailed reviews is a good place to start. For an easier look at top HRMS solutions, download our HRMS Comparison Guide where we’ve broken down the core features, vendor profiles and solution shortcomings in a comprehensive spreadsheet.

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