Gusto vs. Paylocity: Which payroll software should you choose?
Gusto is payroll-first software with published pricing, built for small businesses that want to run payroll without a project plan. Paylocity is a midmarket HCM platform with deeper HR, engagement, and analytics tooling, sold by quote and implemented over weeks.
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- You're a small business and payroll is the core need
- You want published pricing instead of a sales cycle
- You want to be running payroll within days
- You don't have a dedicated HR team
- You're at or approaching midmarket headcount
- You need HR depth: engagement, analytics, talent workflows
- You have an HR function that will own the system
- You can absorb a multi-week implementation
Gusto is the right answer for most small businesses; Paylocity is the right answer once you're a midsize employer with an HR team that needs an HCM rather than a payroll app. The dividing line is usually organizational maturity, not just headcount.
Gusto vs. Paylocity at a glance
A scannable summary. Always confirm current pricing and features directly with each provider before buying.
GustoModern small businesses
PaylocityMidmarket HCM with engagement tools
GustoPublished online
PaylocityQuote-based
GustoSimple: $49/mo + $6/person
PaylocityQuote-based — pricing not published
GustoIncluded
PaylocityIncluded
GustoHR basics
PaylocityFull HCM: talent, engagement, analytics
GustoBuilt in, supported states
PaylocityFull benefits administration
GustoDays
PaylocityWeeks
GustoSoftware-first support
PaylocityAssigned service model
Gusto1–200
PaylocityRoughly 50+
GustoStandard small-business reporting
PaylocityDeeper workforce analytics
Gusto vs. Paylocity: Quick winners
Different businesses weigh trade-offs differently. Here's where each platform tends to come out ahead.
Pricing
Gusto publishes what it charges: $49/month plus $6 per person per month on Simple, and $80/month plus $12 per person on Plus, which includes multi-state payroll, time tracking, and next-day direct deposit.
Paylocity is quote-based, and quotes vary with headcount, modules, and implementation scope, so there is no published rate to check. Ask for the base fee, the per-employee fee, the implementation fee, and the year-two rate in writing, then compare the total against Gusto's published $49 plus $6 per person.
For a small business, the transparency difference matters twice: once when you're budgeting, and again at renewal, when a quoted contract can move in ways a published price sheet doesn't.
Published pricing beats a quote when you're small and cost-sensitive.
Payroll
Both run full-service payroll with federal, state, and local tax filings, W-2s, and 1099s. At small headcount, Gusto's payroll is more than adequate and easier to run. Paylocity's payroll is built to sit inside a larger HCM with complex pay rules, multiple locations, and detailed general-ledger mapping.
Paylocity pulls ahead only when pay rules and structure get complex.
HR, benefits, and engagement
This is the real gap. Paylocity is an HCM: benefits administration, talent workflows, employee engagement tools, surveys, and workforce analytics. If you have an HR leader who wants data and process, that's what they're shopping for.
Gusto covers HR basics and includes benefits administration in supported states plus 401(k) integrations. For a business without dedicated HR staff, more platform usually means more unused platform.
Paylocity is a full HCM; Gusto deliberately stays lighter.
If you've narrowed your choice, check current pricing and details directly with each provider.
Ease of use and implementation
Gusto is fast: sign up, add employees, run payroll. Paylocity is an implementation — data migration, configuration, and training measured in weeks, with an assigned service contact. That's appropriate at midmarket scale and heavy at 12 employees.
Gusto's setup is dramatically lighter at small scale.
Scalability
Gusto handles growth well through a few hundred employees when HR needs stay moderate. Paylocity's runway is longer for companies adding locations, complex pay structures, and formal HR programs.
If you know you're heading to 150+ employees with a real HR function, picking the HCM earlier can save a migration. If that's speculative, don't buy for a company you don't have yet.
Paylocity has more headroom for midmarket complexity.
Gusto pros and cons
- Published pricing
- Full-service payroll tax filings included
- Benefits and 401(k) integrations built in
- Very fast setup
- Clean employee experience
- Lighter HR, talent, and analytics tooling
- Multi-state payroll requires the Plus plan
- Less suited to complex multi-location pay rules
Paylocity pros and cons
- Full HCM: HR, talent, engagement, analytics
- Handles complex pay structures and multiple locations
- Assigned service model
- Runway well past small-business scale
- Quote-based pricing with a sales cycle
- Multi-week implementation
- Overbuilt for most businesses under about 50 employees
- Contract terms need careful review at renewal
Which businesses should choose Gusto?
- Small businesses that mainly need payroll done right
- Owners who want published pricing
- Teams without dedicated HR staff
- Businesses that want to be live this week
Which businesses should choose Paylocity?
- Midsize employers with an HR function
- Multi-location businesses with complex pay rules
- Companies that want engagement and analytics tooling
- Organizations ready to run an implementation project
Gusto vs. Paylocity by business type
Final verdict: Gusto vs. Paylocity
Gusto wins for small businesses. It's transparent, quick to implement, and scoped to the problem most owners actually have.
Paylocity wins once you're a midsize employer with someone whose job is HR. At that point you're buying process and data, not just pay runs, and the implementation effort starts to make sense.
Don't buy midmarket software for a small business on the theory that you'll grow into it — the switching cost later is usually smaller than the cost of running a platform nobody uses.
Gusto for small businesses; Paylocity for midmarket HR teams
Pick your provider and check current pricing
Visit each provider directly to confirm current pricing, packages, and features for your business.
Frequently asked questions
Is Paylocity good for small businesses?+
It can work, but it's built for midmarket employers with an HR function. Below roughly 50 employees, most businesses get more value from a payroll-first platform like Gusto.
How much does Gusto cost?+
Gusto's Simple plan is $49/month plus $6 per person per month, and Plus is $80/month plus $12 per person and adds multi-state payroll, time tracking, and next-day direct deposit.
Does Paylocity publish pricing?+
No. Paylocity is quote-based, so pricing depends on your headcount, the modules you select, and implementation scope.
Which is faster to set up?+
Gusto. You can be running payroll within days, while Paylocity implementations are typically measured in weeks.
When should I switch from Gusto to an HCM?+
Usually when HR process becomes the constraint rather than payroll — regular hiring, formal reviews, complex pay rules, or a new HR leader who needs workforce data.
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