ADP vs Gusto vs Paychex: Payroll Pricing, PEO Costs & Employer Math

Three vendors run payroll for most of American small business, and only one will tell you the price before a sales call. Gusto publishes a base fee plus a per-person fee for every plan; ADP publishes nothing for RUN or Workforce Now, and Paychex publishes nothing for Flex, HR Pro or HR PEO. The published price looks expensive next to a quote you have not received, and the quote looks cheap until the add-ons arrive.

What each vendor actually sells

ADP sells two software lines and a PEO. RUN Powered by ADP covers 1 to 49 employees in four bundles — Essential, Enhanced, Complete Payroll and HR Plus, and HR Pro — rising from tax filing and 24/7 support to SUI management, HR HelpDesk tools and applicant tracking. Time tracking is an add-on in all four bundles, and Essential charges extra for W-2s. Workforce Now covers 50 to 999 and 1,000-plus employees. ADP TotalSource is the PEO line.

Gusto sells three plans, month to month, with no long-term contract. Simple runs payroll in one state with unlimited runs and tax filings, paying employees by direct deposit over ACH. Plus adds multi-state payroll, time tracking, next-day pay and contractor invoices. Premium adds same-day and instant pay, custom admin roles and a dedicated support partner. Gusto is not a PEO: it files under your employer identification number (EIN), and the EIN is the number the IRS matches to every Form 941.

Paychex Flex sells payroll in Select, Pro and Enterprise tiers, then HR Pro and HR PEO above them. Select is the lean package, Pro adds more payroll and workforce features, and Enterprise adds dedicated HR guidance and job costing. HR PEO is the co-employment product. Our payroll provider cost playbook prices Gusto against Rippling and QuickBooks Payroll; this article is the incumbent head-to-head.

The one published price ladder: Gusto

Every Gusto plan is two numbers: a fixed monthly base fee plus a per-person rate — $49, $80 and $180 base, and $6, $12 and $22 per person. The per-person fee applies to every active employee even in a month when that employee was not paid; contractors are billed only in months they were paid. There is no free plan; the Contractor Only plan closed to new customers on 1 October 2026.

The per-person rate doubles from Simple to Plus and nearly doubles again to Premium, while the base fee more than triples: at five employees the plan choice is $211 a month between Simple and Premium, and at 100 it is $1,731. The right question is which plan covers the states you pay people in, because Simple cannot run multi-state payroll.

Worked math 1: Gusto at 5, 25 and 100 employees

Monthly cost is base fee plus headcount times per-person rate; annual cost is monthly times 12, before add-ons, wages, benefits and employer taxes.

At 5 employees: Simple is $49 plus 5 times $6, or $79 a month and $948 a year; Plus is $80 plus 5 times $12, or $140 a month and $1,680 a year; Premium is $180 plus 5 times $22, or $290 a month and $3,480 a year.

At 25 employees: Simple is $49 plus 25 times $6, or $199 a month and $2,388 a year; Plus is $80 plus 25 times $12, or $380 a month and $4,560 a year; Premium is $180 plus 25 times $22, or $730 a month and $8,760 a year.

At 100 employees: Simple is $49 plus 100 times $6, or $649 a month and $7,788 a year; Plus is $80 plus 100 times $12, or $1,280 a month and $15,360 a year; Premium is $180 plus 100 times $22, or $2,380 a month and $28,560 a year.

Effective cost per employee falls as the base fee spreads: on Plus it is $15.20 a month at 25 employees and $12.80 at 100; on Simple, $15.80 at 5, $7.96 at 25 and $6.49 at 100.

The quote-only half: ADP RUN and Paychex Flex

ADP publishes no price for any RUN bundle or Workforce Now package. The RUN product page offers only a Get Pricing button, the comparison page lists all four tiers with Get Pricing under each one and no figure, and the per-employee rate is set in the sales order. What ADP does publish is structure: four RUN bundles, three Workforce Now packages, 24/7 support in every bundle, no fixed term, and a clause letting ADP raise fees on 30 days notice after a new client's first six months.

Paychex is the same shape with one difference: a single independently obtained quote exists. Forbes Advisor's 2026 phone research received three quote formulas for a 10-employee business: Flex Select at $43.93 plus $1.44 per user per month, Flex Pro at $77.18 plus $1.77, and Flex Enterprise at $113 plus $2.92, producing $58.33, $94.88 and $142.20 a month. They are one quote each, not a Paychex rate card, and every package says Request Pricing.

Read the table with the authority column, not the numbers column. The Paychex figures look far cheaper than Gusto at every headcount, and that is the trap: one negotiated quote for one 10-employee business is not a rate card. Use the Forbes figures as a negotiating anchor: if your Paychex written quote comes back above Gusto Plus at your headcount for the same features, ask why.

Worked math 2: the employer tax bill dwarfs the software bill

Every payroll comparison that stops at the software fee understates the employer's real cost. The employer owes Social Security tax of 6.2 percent on wages up to the $184,500 wage base for 2026, Medicare tax of 1.45 percent with no wage base limit, and FUTA tax of 6.0 percent on the first $7,000 of each employee's wages, less a credit of up to 5.4 percent for state unemployment taxes paid on time, leaving 0.6 percent, or $42 per employee per year. Rates are from IRS Publication 15 and the Instructions for Form 941 for 2026, read today. Social Security and Medicare together are the FICA taxes, applying whether the business is an LLC, an S-Corp or a C-Corp. The filing mechanics are worked in our quarterly payroll tax filing playbook.

Take 25 employees at $60,000: payroll is 25 times $60,000, or $1,500,000. Social Security is 6.2 percent, or $93,000, since all sit below the wage base. Medicare is 1.45 percent, or $21,750. FUTA is $42 times 25, or $1,050. The employer total is $93,000 plus $21,750 plus $1,050, or $115,800 a year — $4,632 per employee — before state unemployment tax (SUI).

Against that total, Gusto Plus at 25 employees is $4,560 a year of software versus $115,800 of employer tax, or 3.9 percent. At 5 employees the tax total is $18,600 plus $4,350 plus $210, or $23,160, so Gusto Simple at $948 is 4.1 percent; at 100 it is $372,000 plus $87,000 plus $4,200, or $463,200, so Gusto Plus at $15,360 is 3.3 percent.

For one employee at $200,000, Social Security runs on the first $184,500 only: 6.2 percent is $11,439. Medicare on the full $200,000 is $2,900, and FUTA is $42, for an employer total of $14,381 a year. A quote that ignores your wage distribution prices the wrong thing — run the employer tax total through our tax estimator before you sign, and have your CPA confirm the SUI rate for each state.

PEO versus service bureau: the model decision

The third price here is not a software fee at all. A service bureau runs payroll and files taxes while you remain the employer of record. A PEO becomes a co-employer: it files taxes under its own employer identification number, sponsors the benefits, carries the workers' compensation policy, and charges an administration fee on top, usually a percentage of payroll. ADP TotalSource and Paychex HR PEO are the PEO lines.

A PEO is a different purchase, not a pricier version of payroll software: it can lower small-group health insurance rates and move workers' compensation and HR liability onto its own balance sheet. Compare its invoice with your software fee, benefits administration cost, workers' compensation premium and HR time combined, and get the administration fee as a payroll percentage in writing first.

Operator boundaries: who should not buy each vendor

Do not buy Gusto Simple for a multi-state team — Simple is single-state only and Plus doubles the per-person rate — and do not buy Gusto at all if you need a PEO. Do not buy ADP RUN if you need a complete recurring price before talking to a salesperson: no RUN price exists in public. Do not buy ADP RUN Essential if W-2s matter to your year-end budget: Essential charges extra for W-2s, amount unpublished. Do not buy Paychex Flex on the Forbes quote alone: it belongs to one 10-employee business. Do not buy any PEO if your only problem is running payroll: co-employment hands the PEO your tax filings and benefits sponsorship for a problem a service bureau solves at a fraction of the price.

The buying protocol

1. Fix headcount, states and pay frequency, then price Gusto first: it is the only published ladder and sets the anchor.
2. Request written quotes from ADP and Paychex on the same day, for the same headcount, states and frequency, itemizing base fee, per-employee rate, implementation fee and year-end form fees.
3. Add the employer payroll tax total from the IRS rates above to every quote, so the software fee is judged against the full cost.
4. Ask each vendor, in writing, whether time tracking, multi-state filing, garnishments, off-cycle runs and W-2 and 1099 corrections are included or separate.
5. Ask for the renewal clause and the early-termination fee in writing, and confirm the quoted rate is locked past the first six months.
6. Compare the three written totals at your headcount, then choose the vendor whose included features match your states and frequency, not the lowest first number.

Execution checklist

• [x] Price Gusto from the published ladder at your headcount; confirm multi-state needs first.
• [x] Request ADP and Paychex quotes in writing on the same day, same headcount and states.
• [x] Require every quote to itemize base fee, per-employee rate, implementation fee and year-end form fees.
• [x] Compute the employer payroll tax total from the IRS 2026 rates: 6.2 percent Social Security to $184,500, 1.45 percent Medicare, 0.6 percent FUTA on $7,000.
• [x] Confirm the renewal clause, price-change notice and early-termination fee in writing before signing.
• [x] Decide service bureau versus PEO on co-employment, not the monthly fee.
• [x] Re-price the contract at month seven.