Gusto vs Justworks (2026): Payroll Software vs PEO Compared

A side-by-side comparison of Gusto and Justworks for payroll, benefits, and HR compliance — including pricing, features, and which one fits your team size.

Updated 2026-09 · 2026

Gusto

Payroll, benefits, and HR software for small businesses

From $40/mo + $6/person/momonth + per employee

Strengths

+Transparent, affordable per-employee pricing
+Fast self-serve setup, no sales calls required
+Full-service payroll tax filing in all 50 states

Weaknesses

-You remain the legal employer — no compliance offload
-Benefits require a licensed broker add-on in many states
-HR advisory support is limited on lower tiers

Best for

Small businesses and startups that want simple, affordable payroll software without becoming a PEO client.

Justworks

PEO providing payroll, benefits, and HR compliance as co-employer

From $59/employee/moper employee

Strengths

+True PEO model shifts compliance and employer liability off your business
+Access to large-group health insurance rates
+24/7 customer support included

Weaknesses

-Meaningfully more expensive per employee than Gusto
-Co-employment model is overkill for very small or simple teams
-Less customization/flexibility than standalone payroll software

Best for

Growing companies with remote or multi-state employees that want outsourced HR compliance and enterprise-grade benefits.

Feature Comparison

Feature	Gusto	Justworks
Payroll processing	Yes, full-service	Yes, full-service
Employer of record / PEO model	No	Yes
Health insurance access	Via broker partners	Large-group rates included
Workers comp	Add-on via partner	Included
Multi-state payroll tax compliance	Supported	Fully managed
HR compliance advisory	Limited, higher tiers only	Included on all plans
Contractor payments (1099)	Yes	Yes
Time tracking	Built-in on higher tiers	Built-in
Accounting integrations	QuickBooks, Xero, FreshBooks	QuickBooks, Xero
Support model	Email/chat, business hours	24/7 phone/chat
Pricing transparency	Published on site	Published on site
Best team size	1–50 employees	10–500 employees

The Verdict

Gusto is the cheaper, simpler choice if you just need payroll and basic HR tools and don't mind staying the legal employer. Justworks costs more per head but is worth it once you have remote employees across multiple states or want compliance and benefits handled for you. Pick based on whether you're buying software (Gusto) or outsourcing HR liability (Justworks).

How to switch from Gusto to Justworks

1Export your data from Gusto: run the Payroll Journal and Employee Directory reports under Reports and download as CSV, then pull historical tax filings (940, 941, W-2s, 1099s) from the Documents tab.
2Sign up for a Justworks account and choose between the PEO Basic or PEO Plus plan based on which benefits tier you need.
3Work with your assigned Justworks onboarding specialist to bulk-import employee data via CSV, including pay rates, tax withholding elections, and PTO balances.
4Set up your payroll schedule, benefits enrollment, and workers comp policy in Justworks — since it's a PEO, employees will need to sign new co-employment agreements.
5Reconnect your accounting integrations (QuickBooks, Xero) through Justworks' integration marketplace since Gusto's connections won't transfer automatically.
6Run one parallel payroll cycle in both systems to confirm numbers match, notify employees of the co-employment change, then fully cut over and cancel your Gusto subscription.

Gusto vs Justworks: common questions

How do I export my data from Gusto before switching?+

In Gusto, go to Reports and run the Payroll Journal and Employee Directory reports, then export both as CSV. You'll also want to download historical tax filings (940, 941, W-2s, 1099s) from the Documents tab, since Justworks will need prior payroll history to calculate year-to-date totals correctly.

What features do I lose moving from Gusto to Justworks?+

You don't lose payroll or benefits functionality, but you give up some flexibility since Justworks operates as a co-employer with standardized policies and agreements. You also lose Gusto's lower-cost self-serve setup — Justworks requires onboarding through their team and signing new employment agreements for each employee.

Is Justworks worth it for a small team of 5-10 people?+

Usually not — at $59+/employee/month, Justworks is expensive relative to Gusto's $40 base + $6/person for a tiny team, and you likely don't need multi-state compliance or PEO-level benefits yet. It becomes worth it once you're hiring across states or need group health insurance rates you can't get alone.

Do Gusto's integrations transfer over to Justworks?+

No, integrations don't carry over automatically — you'll need to reconnect accounting tools like QuickBooks or Xero through Justworks' own integration marketplace. Any custom Gusto API connections or Zapier workflows will need to be rebuilt from scratch.

Does switching to Justworks save money long-term or cost more?+

For most small teams, Justworks costs more long-term on a pure per-employee basis compared to Gusto. The savings come indirectly — through better group health insurance rates, reduced HR compliance risk, and time saved not managing multi-state payroll rules yourself, which can offset the higher subscription cost as you scale.