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ADP and Paychex are two of the biggest and oldest names in payroll outsourcing services. Both options provide business owners with cloud-based, fully automated payroll software, while maintaining strong, human-powered support teams — and both companies’ services also extend well beyond payroll to provide comprehensive human resources and benefits services as well.
Because they offer such similar services, and they’re both so widely trusted by small-business owners, this comprehensive comparison of ADP and Paychex can help you discover what makes each service unique so you can decide which might be best for your business.
ADP is one of the oldest and largest employer services companies in the nation: From their beginnings in 1949 as solely a payroll processing business, ADP has expanded into providing comprehensive human capital management solutions to 700,000 small businesses and enterprises worldwide.
If you just need a payroll service, you’ll probably use Powered by ADP, the company’s online payroll processing platform designed specifically for small-business owners, and which business owners can use to streamline and automate their payroll and payroll taxes — but even if you use their online software, you’ll still have 24/7 access to ADP’s own payroll and tax experts. And if need be, you can choose to take advantage of ADP’s other HR and benefits solutions, too.
ADP serves over half a million small businesses (which they define as businesses with 1-49 employees) with their cloud-based payroll solutions. In addition to running payroll from ADP’s centralized, digital dashboard, ADP will also automatically deduct your workers’ comp insurance every pay period, and automatically deposit your staff’s paychecks via check, direct deposit or a pay card.
ADP offers small-business owners four online payroll processing packages, which increase in available features and are designed for businesses of increasing sizes and needs:
Essential: This plan works best for startups, or for businesses that only need a payroll solution. Among other features, with this plan you’ll get payroll delivery, W2 and 1099 forms, reporting capabilities, relevant state and federal forms and direct deposit — and your employees will be able to access their own online portal where they can view and manage important forms and information.
Enhanced: With this plan, you’ll get everything included in the Essential package, plus check signing and stuffing, prepaid cards, poster compliance, state unemployment insurance and wage garnishment services.
Complete: This plan provides business owners with all the payroll features included in the Enhanced plan, plus essential HR services like employee handbooks, background checks and access to ADP’s HR Help Desk.
HR Pro: ADP’s most comprehensive package, HR Pro provides business owners with full-service payroll and HR support.
ADP provides comprehensive employer services in addition to their payroll solutions, all of which integrate with your payroll processing and HCM system:
Time and attendance: Digitally track your employees’ hours, time-off requests, scheduling and more.
Talent: ADP’s talent services can help you optimize the entire employee lifecycle, from recruiting, to hiring, to managing employees and promoting their growth, to providing them with retirement plans.
Employee benefits: ADP provides digital employee benefits administration solutions, as well as both online and in-person benefits advisory services. You can also get retirement plans, group health insurance and business insurance through ADP’s partnerships with insurance agents and carriers.
HR services: ADP provides a wide range of HR services at varying degrees of personalization. If you have a general HR-related question, you can reach out to HR HelpDesk, their team of HR experts, via call, email or chat. You can also access key HR documents and an employee handbook wizard. If you need more intensive support, you can use ADP’s HR consulting services or partner with a dedicated HR expert who can help you design and implement a customized HR solution. Alternately, you can choose to outsource some or all of your HR administration to ADP’s experts, or partner with ADP as a PEO.
You can integrate tons of apps into your ADP platform, too, including accounting solutions like QuickBooks Online and Xero; ERP (enterprise resource planning) software; time and attendance apps; and lots more. ADP also has their own app marketplace where you can search and download compatible apps to suit your business’ needs.
ADP charges custom pricing based on your business’s size, which of their services you need and which payroll package you sign up for, among other factors. You can receive a free custom quote by filling out basic information about your business on their website, or by contacting an ADP sales representative directly.
ADP user reviews
Overall, ADP receives largely positive user reviews across major review platforms: they’ve received a 4.2 out of 5 rating on G2 Crowd and 5 out of 5 stars on Trustpilot, but a slightly lower rating on Consumer Affairs with just over 3 out of 5 stars.
Positive reviewers say that ADP’s software is easy to use, that their service delivers exactly the services they claim and that the ADP customer service team is responsive and knowledgeable. On the other hand, some reviewers say that they had difficulty setting up their accounts, have had occasional issues with direct deposits and have encountered other glitches. Whatever their shortcomings, a point in ADP’s favor is that they’ve promptly responded to almost every review on Consumer Affairs and Trustpilot, both the negative and the positive.
Since their start in 1971, Paychex has become one of the best-known payroll and HR solutions providers for small-to-medium sized business owners. In addition to those two major services, Paychex’s roster boasts an absolutely thorough amount of employer services, including time and attendance, benefits administration, compliance services, records administration, recruiting and onboarding, health insurance and retirement plans and several types of relevant insurance, like workers’ comp and business auto insurance. It’s also worth noting that Inc. named Paychex Flex the best overall HR outsourcing service for small-business owners, especially for offering on-site HR professionals if you need hands-on help.
For a limited time only, Paychex is offering 3 months free payroll; so if you’re thinking of refreshing your payroll services, now is a great time to get Paychex.
Let’s take a closer look at what Paychex offers its approximated 605,000 small-business clients.
Paychex offers so many services on their platform, but first let's explore their small-business payroll services, which are suitable for businesses with one-49 employees.
Paychex will calculate, pay and file most local payroll taxes on your behalf. You’ll also have access to Paychex’s online payroll processing software, which you can access on your computer or your phone with their free mobile app. Other features included in Paychex’s small-business payroll processing service are:
The ability to pay any kind of workers (full-time, hourly or contract) via direct deposit, paper checks or paycards
Automatic tax payroll administration
HR analytics and an events calendar
Custom reports and analytics
24/7 customer support.
…and lots more. Employees will also receive logins to an employee self-service portal, where they can access documents like new hire paperwork and payroll forms, change their personal information and request time off. Also, Paychex can help you switch to Paychex if you’re already working with a payroll processor.
Paychex also offers combined payroll and HR solutions packages for businesses of all sizes: between one and nine employees; 10-49 employees; or 50-1,000+ employees. Included in their packages are comprehensive time and attendance management, PEO services, hiring services, employee benefits and business insurance.
Beyond that, Paychex can offer additional services that aren’t typically offered by payroll/HR solutions providers, like financial management services, payment processing, tax services and services geared especially toward startups, like incorporation assistance and an online marketing platform.
Like ADP, Paychex provides custom pricing based on your business’s size, needs and which of Paychex’s four packages (Express Payroll, Paychex Flex Select, Paychex Flex Pro or Paychex Flex Enterprise) you’re interested in.
You can request a free quote for any of these four packages by providing your business’s information on the Paychex website. For a limited time, Paychex is offering two months of free services before you need to commit to a paid plan.
Paychex user reviews
User reviews about Paychex are a mixed bag: The company receives 4 out of 5 stars on G2 Crowd and an A+ rating on BBB, but they’ve also received just over 2 out of 5 stars on Consumer Affairs and a 2 out of 5-star rating on BBB. On the positive side, recent reviewers say that the Paychex interface is easy and efficient to navigate, and lots of users have successful experiences with the payroll service itself. The company’s negative reviews focused on technical issues and a lack of transparency about their processes.
Gusto Payroll Plans start at $39 per month (base) and $6 per person per month. Read review.
RUN Powered by ADP Plans start at $59 per month (base) and $4 per person per month. Read review.
OnPay Payroll Plans start at $36 per month (base) and $4 per person per month. Read review.
Square Payroll Plans start at $35 per month (base) and $5 per person per month. Read review.
QuickBooks Payroll Plans start at $45 per month (base) and $4 per person per month. Read review.
Wave Payroll Plans start at $20 per month (base) and $6 per person per month.
Providers may offer lower promotional pricing.
A version of this article was first published on Fundera, a subsidiary of NerdWallet