Gusto is the payroll platform we use at Business Credit Workshop, and we like it. I recommend you check it out, as long as it meets your needs. I want to explain why I chose them instead of the competition and raise every objection I can think of in this comprehensive Gusto review.
First of all, Gusto is super easy to use, and the platform calculates payroll taxes for you, making it so much simpler to pay employees and contractors. Plus, I didn’t have to talk with a sales rep to get started (don’t you just hate that?).
Now, let’s talk about Gusto’s pricing, features, and other details.
Here’s what we’ll cover:
- Briefly, What is Gusto?
- Gusto Payroll Platform
- Gusto Benefits Summary
- Gusto HR Features
- Gusto Alternatives
- Frequently Asked Questions
- Final Thoughts
Now, let’s begin!
Briefly, What is Gusto?
In essence, Gusto is a payroll, benefits, and hiring platform for businesses. It enables you to pay your team quickly, easily, and automatically no matter where they are. The software is designed for all-sized teams, both in-person and remote.
While I usually talk about features before I get into pricing, the most common question I hear is “How much does Gusto cost, so let’s address this first.
Gusto Pricing Breakdown
Gusto has four pricing tiers, designed for affordability based on varying operational needs, and plans range from $35 to $60+ per month plus $6 to $9 per person:
- Contractor-only – Payroll only for $35 plus $6 per person per month with $0 monthly for 6 months
- Simple – Automatic payroll features and benefits integration for $40 plus $6 per person per month
- Plus – Comprehensive payroll, benefits, and HR for $60 plus $9 per person per month
- Premium – Scalable payroll, benefits, HR, and dedicated support with pricing based on your needs
The ‘Contractor-only’ plan is built for companies that only work with contractors, and have no active W2 employees. ‘Simple’ is best for those who want to integrate payroll with a benefits plan for employees. ‘Plus’ is designed for those who are actively hiring and could benefit from the HR tools in addition to benefits and payroll. And, the ‘Premium’ tier is for those who need dedicated HR support for hiring at scale.
Gusto Company Overview
Here’s the million-dollar question: Is Gusto a legit company, or is it just a trending brand destined to fade in relevance? I can’t say for sure, but I can tell you everything I know, and share my insights.
So, who is Gusto?
Gusto, aka ZenPayroll Inc, is a San Fransisco-based company that was founded in 2011 by Edward Kim, Joshua Reeves, and Tomer London. The company is considered a business “unicorn” and has received $746.1 million in funding since its launch.
Prior to working on the Gusto project, Edward Kim helped launch a photo-sharing app for families called PicWing. It seems like the project may have originally been a Y Combinator startup, but it’s currently inactive. Picwing was launched after Kim left his position as a Senior Project Engineer for Volkswagen.
Recommended: Y Combinator: Fast Track to Success or Waste of Time?
Joshua Reeves is currently the Head of Gusto, and it appears that he started the project directly out of college. He has a bachelor’s degree in Electrical Engineering from Stanford University.
Gusto’s Chief Product Officer, Tomer London, was also in Stanford’s Electrical Engineering program, and was a Ph.D. candidate. London worked for Intel and Bump for a while. Then, prior to Gusto, co-founded a company called Vizmo, a software development company based in Israel.
All of Gusto’s co-founders have strong technical backgrounds, and the company has been going strong for over a decade. My opinion is that they’re likely to be around for the long haul (yes, they’re legitimate).
Gusto Payroll Platform
First of all, the Gusto Payroll platform calculates and files payroll taxes for you, streamlining the process. Unlimited checks can be distributed to team members. Other platforms charge for this service, but with Gusto taxes are inbuilt.
They also offer time-tracking with plus plans. So, your employees can track hours from the same platform you use to pay them if you elect to use this feature.
Gusto plays nicely with Xero, Clover, Quickbooks, TSheets, Trainual, 7Shifts, and more. So, you can integrate the other tools and apps you use to manage financial accounts; operations are much easier when you can manage multiple tasks from a unified dashboard and automate information sharing.
In the platform, you can store 1-9s, W-2s, and 1099s, register for state taxes in all 50 states, and track time including lunches and breaks. When onboarding, Gusto ensures that The system will even auto-file your payroll taxes for you, so compliance is a breeze.
If employees want to request time off, they can do so easily through Gusto Wallet.
And, guess what?…
Later, if employees leave your company, they can opt to keep their cash accounts, and have their next employer direct deposit into an FDIC-insured Gusto account like they would a regular bank account. This feature might be an enticing incentive for some.
On the other hand, if you’re looking to optimize retention, you may not want to mention it. Decide for yourself on this one.
Gusto Wallet is a mobile app, available for iOS and Android, that teams can download to view and cash their paychecks, access their spending account, and manage and automate up to five savings goals.
Savings accounts earn 1% APY with no account or overdraft fees. Staff members have the ability to alter their contribution to savings goals at any time, and can transfer to spending accounts instantly.
Wallet spending accounts come with a Visa debit card with free withdrawals at 37K ATMs across the country and direct deposit. They also enable budgeting for necessities like housing, food, and transportation.
With the app, users can track their time, view and download paychecks and W2s, see transaction history, and split checks. Gusto Wallet is only available for first-time access if the employer uses the platform.
Gusto Benefits Summary
Gusto Benefits is the platform’s built-in way for you to offer affordable employee benefits. Here’s what it entails.
- Integrate your existing broker and eligible health plans
- Manage employee health insurance plans
- Access 9K+ available health insurance plans from 30+ carriers
- Low-cost worker’s comp management, HSAs, and FSAs
- Administer dental, vision, and commuter benefits
- Handle renewals during open enrollment periods
Essentially, you can sync your health benefits packages with your payroll framework using Gusto in a straightforward and easy-to-navigate dashboard.
Plus, you can offer your staff multiple ways to save. Through their Gusto Wallet, employees can access cash accounts with all sorts of features. In addition, you can offer them the opportunity to add funds to 401(k) retirement, life & disability insurance, and 529 college savings plans.
Gusto HR Features
All Gusto plans include access to hundreds of HR templates to help you onboard new staff. Get pre-written job descriptions & offer letters, termination requirements, labor law policies, and performance evaluations. And, you can take advantage of the Employee Handbook Builder.
If you’re interested in sampling the goods, Gusto shares a free guide, How to Create an Employee Handbook, with the public.
Dedicated HR Support
If you have a premium Gusto plan or opt for the HR add-on with a Plus plan, you can access dedicated HR experts to help with your hiring and compliance. This grants you access to unlimited advice from SHRM and HRCI-certified experts to help you avoid costly lawsuits down the road.
Here’s why this is a value-packed offer:
- The starting ACA penalty per employee is $2,750.
- For your first violation of the Americans with Disabilities Act, you can be fined up to $75K.
- The average cost of an employee lawsuit is $160K.
Personal advice from experts mitigates your chances of running into inadvertent legal violations and protects your business.
Gusto has two customer care teams, one for current users, and one dedicated to helping business owners get started (sales). You can reach out via the live chat on Gusto.com, or call 855-384-0612 during business hours (MST).
When you first sign up, the sales team is fantastic.
With that said, several account holders are unsatisfied with the user-facing customer service team, citing that it’s very difficult or takes a long time to get errors corrected.
Not to downplay this concern, but the Gusto platform itself has a very user-friendly interface with a helpful set of robust features that might offset this drawback. I haven’t run into this problem myself, but I have no reason to discredit the anecdotes from other users.
It wouldn’t be fair to tout on about the Gusto platform without at least letting you know that there are a ton of other options out there (you should always do your due diligence).
So, who are Gusto’s competitors? Here are the three most popular:
- ADP – Pricing unknown
- Paychex – Pricing unknown
- Rippling – Starts at $8 per month per user
- BambooHR – HR-only, pricing unknown
As far as I can tell, each of the above competitors requires that you work with a rep to get an account set up while Gusto enables you to sign up on your own. Rippling is the only one of the three that is upfront with their pricing.
Definitely explore other offers (there are many) and make sure you choose a platform that meets all of your needs… before you invest your energy into onboarding everyone into a new system.
Frequently Asked Questions
Does Gusto report to the IRS?
Yes. Gusto doesn’t file your taxes for you, but they provide a full-service package that includes paying payroll taxes automatically.
Does Gusto send out W-2s?
If applicable, once per season, Gusto can send out W-2s and W-2Cs to your employees for $3 per person plus mailing fees. The costs are added to your monthly invoices.
Does Gusto pay your payroll taxes for you?
Gusto does not foot the bill for your business taxes, but, yeah, they will automatically do the math and make accurate tax payments (debited from your account) on your behalf.
How long do Gusto payments take?
When you begin running payroll through Gusto, your employees will be put on 2-day payment terms. So, they will be able to access their funds within a couple of days of when they are disbursed.
I use Gusto to pay my staff and like it (a lot), mostly because it’s super easy to use and they calculate the taxes for you. Here’s a summary of the offer:
- Sign up without a phone call with a sales rep or “scheduling a demo”
- Get your team fully onboarded in about two weeks
- Save an average of 5 hours per month on payroll and HR
- Take advantage of an extremely user-friendly platform
- Integrate your payroll, benefits, and HR dashboards with your financial tools.
Last time I checked, many moons ago, ADP needed you to talk to a salesperson to get signed up. As far as I know, this is still the case (the folks at ADP aren’t even transparent about their pricing). I like to do things quietly and online with the option to chat or call in when needed. I get all of this with Gusto.
Some business owners have been unsatisfied with the amount of time it takes the Gusto team to correct mistakes, but I haven’t encountered this issue. There is no mobile app for payroll management, only an app for employees. And, the platform may not be best-suited for businesses with overseas staff, since they don’t offer global payroll.
If Gusto sounds like a system you’d be into, then I encourage you to check them out — Signing up might save you time and money on payroll and hiring. Are you interested in learning how to obtain up to $100K in business credit in as few as 30 days? If so, join Business Credit Workshop today.