Skip to content

The 5 Best Payroll Software for Businesses

Read time: minutes

Table of Contents
    Add a header to begin generating the table of contents

    When searching for a payroll software to handle your business’s financial and human resources needs, choosing a provider that offers top-tier services and a strong reputation is essential. In this regard, five standout companies emerge: ADP, Paychex, Gusto, Paylocity, and Paycom.

    These industry-leading payroll companies have earned their positions by consistently delivering exceptional solutions tailored to businesses of all sizes. Whether you’re a small startup or a thriving enterprise, these companies provide a comprehensive range of services, including payroll processing, tax compliance, HR management, and benefits administration. With their proven track records, cutting-edge technology, and commitment to customer satisfaction, these top payroll companies offer reliability, efficiency, and peace of mind for businesses seeking to streamline their payroll operations and focus on their core objectives. 

    It’s important to consider their market presence, reputation, range of services, customer satisfaction, and industry recognition. Based on these factors, here are five prominent payroll companies in the United States: 

    1. ADP (Automatic Data Processing): ADP is a well-established payroll service provider with a strong market presence and a wide range of payroll solutions. They offer comprehensive services that cater to businesses of all sizes, including payroll processing, tax compliance, HR solutions, and employee benefits administration. 
    1. Paychex: Paychex is another major player in the payroll industry, offering payroll processing, tax services, HR solutions, and time and attendance management. They have a reputation for excellent customer service and have been recognized for their commitment to small and medium-sized businesses. 
    1. Gusto: Gusto is a popular choice for payroll software among small businesses for its user-friendly platform and comprehensive payroll services. They provide automated payroll processing, tax filing, benefits administration, and other HR tools. Gusto is known for its intuitive interface and excellent customer support. 
    1. Paylocity is a cloud-based payroll software and human capital management (HCM) software company based in the United States. It provides a range of integrated solutions designed to streamline and automate payroll processes, HR management, time and labor tracking, talent management, and benefits administration. Paylocity serves businesses of all sizes, from small startups to large enterprises, across various industries. 
    1. Paycom is a cloud-based payroll and human capital management (HCM) software company that provides comprehensive solutions for managing various aspects of HR, payroll, talent acquisition, and workforce management. Founded in 1998 and headquartered in Oklahoma City, Paycom serves businesses of all sizes across different industries. 

    These five companies represent well-established payroll providers and innovative platforms catering to different business sizes and needs.  

    What makes each of these companies unique? 

    The best payroll software for businesses of all sizes: ADP

    ADP (Automatic Data Processing) is a prominent payroll software company known for its extensive experience, wide range of services, and innovative solutions. Here are some unique aspects that set ADP apart from other payroll providers. From my perspective, writing one of 5 of the worlds paycheck’s is an extraordinary differentiator. ADP is just huge with huge market share and millions and millions of clients!

    ADP’s stands out because…

    1. Global Presence: ADP has a vast global presence, serving clients in more than 140 countries. This extensive reach allows them to handle the complexities of international payroll, tax compliance, and HR management, making them a preferred choice for businesses with global operations or those planning to expand internationally. 
    1. Scalability and Flexibility: ADP offers solutions that cater to businesses of all sizes, from small startups to large enterprises. Their services can be customized to meet the unique needs and requirements of each organization, providing scalability as businesses grow and evolve. 

    The best payroll software for small businesses: Paychex

    Paychex is a well-established payroll software company that stands out in the industry for several reasons. In my mind, Paychex is really unique because they provide HR experts who can actually go on-site to your business and work as your in-house HR team. That is very different from most payroll companies. In addition to that, Paychex has great reporting. It’s super easy to pull out reports and they are largely intuitive based on what business owners needs.  

    Paychex stands out because…

    1. Focus on Small and Medium-Sized Businesses: Paychex has a strong emphasis on serving the payroll and HR needs of small and medium-sized businesses (SMBs). They understand the unique challenges faced by these businesses and offer tailored solutions that cater to their specific requirements. Paychex’s expertise in serving SMBs has earned them a reputation as a trusted partner for businesses in this segment. 
    1. Comprehensive Service Offerings: Paychex provides a comprehensive suite of services beyond payroll processing. They offer a wide range of solutions, including HR management, time and attendance tracking, benefits administration, retirement services, workers’ compensation, and HR outsourcing. This comprehensive approach allows businesses to consolidate their payroll and HR functions with a single provider. 

    The most user-friendly payroll software: Gusto

    Gusto is a payroll software company that differentiates itself through its unique approach to payroll and HR services. I think Gusto is unique because it is basically do-it-yourself payroll like a Quickbooks or Sage payroll, however Gusto’s platform is so user friendly, you don’t realize you’re basically doing DIY payroll with a platform. 

    Gusto stands out because…

    1. User-Friendly Platform: Gusto prides itself on its intuitive and user-friendly platform for its payroll software. The company has designed its software to be accessible and easy to navigate, even for users with limited technical expertise. This user-centric design makes Gusto an attractive choice for small businesses or startups that value simplicity and ease of use. 
    1. Employee Self-Service: Gusto places a strong emphasis on providing self-service capabilities for employees. Through Gusto’s platform, employees can access and update their personal information, view pay stubs and tax forms, manage benefits enrollment, and request time off. This empowers employees and reduces the administrative burden on HR departments. 
    1. Modern and Engaging Employee Experience: Gusto aims to provide a modern and engaging employee experience. The platform offers features like personalized welcome messages, interactive pay stubs, and automated reminders for important HR tasks. These features help foster a positive and engaging work environment. 

    The best payroll software for HR directors: Paylocity

    Paylocity is a payroll software company that distinguishes itself through several unique features and offerings. From my perspective, I think Paylocity’s software is a great tool for HR directors because they have great HR analytics and a heavy focus on employee learning tools.

     Paylocity stands out because…

    1. Robust HR Management Capabilities: In addition to payroll processing, Paylocity provides a range of robust HR management features. These include employee onboarding, benefits administration, performance management, time and attendance tracking, talent management, and learning management. The integration of these HR functionalities into the payroll system allows businesses to centralize their HR processes, simplifying management and increasing efficiency. 
    1. Employee Learning and Development: Paylocity offers employee learning and development tools to help organizations foster growth and skill development. This includes training programs, online courses, and resources for employees to enhance their professional knowledge and expertise. 

    The best payroll software for direct payroll data entry: Paycom

    Paycom stands out as a payroll software company due to several distinctive features and offerings. From my perspective, I think Paycom does an outstanding job with their marketing and brand. They do a good job of identifying that they sell to the HR suite, and all of their initiatives are designed for HR experts to find them. Outside of that, the largest differentiator for Paycom is PAYROLL BETTI, or direct payroll data entry.

    Paycom stands out because…

    1. Single Payroll Software Solution: Paycom provides a single, comprehensive software solution that covers a wide range of HR and payroll functions. This unified platform integrates payroll processing, HR management, talent acquisition, time and attendance tracking, and other HR-related tasks. The advantage of this approach is that businesses can manage all their HR processes in one place, streamlining operations and reducing the need for multiple disparate systems. 
    1. Direct Data Entry: Paycom offers a unique feature called Direct Data Entry, which allows employees to input their own data directly into the system. This feature eliminates the need for manual data entry by HR personnel, reducing errors and saving time. Employees can update their personal information, enter time and attendance data, manage benefits, and perform other tasks through the self-service portal. 

    Now that we’ve shared 5 top payroll companies and what makes them unique, let’s play a game.

    Which payroll software should you choose based on the type of buyer you are? 

    If you are a small business owner with 1-10 employees,  looking for the most features for your employees, choose Paychex.  

    Paychex would be a strong choice for your company. Here’s why: 

    1. Focus on Small Businesses: Paychex has a strong emphasis on serving small businesses. They understand the unique needs and challenges faced by small companies, offering tailored solutions that align with your requirements. Paychex’s expertise in serving small businesses makes them a trusted partner in providing payroll and HR services. 
    1. Comprehensive Service Offerings: Paychex provides a comprehensive suite of services beyond payroll processing. They offer solutions for HR management, benefits administration, time and attendance tracking, retirement services, workers’ compensation, and more. This comprehensive approach allows you to centralize your HR functions with a single provider, simplifying processes and saving time. 
    1. Scalability and Flexibility: Paychex offers scalable solutions that can grow with your business. As your company expands, Paychex can accommodate your changing needs by providing additional services and functionalities. This scalability allows for seamless transitions and avoids disruptions to your payroll operations. 
    1. Compliance Support: Paychex is well-versed in payroll and HR regulations, helping businesses maintain compliance with constantly evolving laws. They provide guidance and tools to navigate complex compliance requirements, reducing the risk of errors, penalties, and legal issues. This ensures that your payroll processes adhere to local, state, and federal regulations. 
    1. Technology and Innovation: Paychex invests in technology and innovation to deliver cutting-edge solutions. They provide user-friendly software and mobile apps, allowing you to access payroll and HR information conveniently. Their digital tools streamline processes, enhance efficiency, and provide a modern user experience. 
    1. Customer Support: Paychex offers reliable customer support to assist you whenever you have questions or encounter issues. Their dedicated support team can provide guidance, troubleshoot problems, and offer solutions promptly, ensuring that you receive assistance when needed. 

    While Paychex appears to be a strong fit for your small business, it’s important to evaluate each option based on your specific requirements, budget constraints, desired features, and any unique needs of your industry. Comparing and considering these factors will help you make an informed decision for your payroll software selection. 

    If you are an HR director with 1-60 Employees, choose… Gusto!  

    As an HR director of a business with 60 employees, selecting the most suitable payroll software requires considering several factors. While each of the options you provided has its own strengths, based on your specific circumstances, Gusto may be the best choice for your company. Here’s why: 

    1. User-Friendly Interface: Gusto is known for its intuitive and user-friendly platform. With a simple and modern interface, it offers easy navigation and accessibility for both administrators and employees. This can be particularly beneficial for small to mid-sized businesses with limited resources for training and implementation. 
    1. SMB-Focused Features: Gusto caters to the needs of small and medium-sized businesses, which aligns well with your organization’s size. It offers comprehensive payroll and HR solutions, including benefits administration, time tracking, and employee self-service capabilities, providing the necessary tools to manage your workforce effectively. 
    1. Cost-Effectiveness: Gusto’s pricing is often competitive for small to mid-sized businesses. It offers transparent and affordable pricing plans, making it an attractive option for organizations looking for cost-effective payroll software solutions. 
    1. Compliance Support: Gusto keeps up with ever-changing HR and payroll regulations, helping businesses maintain compliance. It handles tax calculations, generates required tax forms, and stays updated on legal changes, reducing the burden of compliance-related tasks. 
    1. Integration Capabilities: Gusto integrates with a wide range of third-party applications, including accounting software and time tracking tools. This integration ecosystem allows for seamless data transfer and simplifies workflows, ensuring smoother payroll processes. 
    1. Employee Experience: Gusto prioritizes the employee experience, offering self-service features that empower employees to access and update their personal information, view pay stubs, and manage their benefits. This promotes employee engagement and reduces administrative tasks for the HR team. 

    While Gusto appears to be a strong fit for your organization, evaluating each option based on your specific requirements, such as budget constraints, desired features, customer support, and any unique needs of your industry is always recommended. Conducting a thorough comparison and considering factors specific to your business will help you make an informed decision. 

    If you’re an owner only focused on the most cost effective or cheapest price, choose ADP!  

    ADP is known for offering great deals for their payroll service like 3 to six months of free payroll services with no upfront charges. If you’re looking to get started and you want to go as cheap as possible, ADP is often a grae choice. While ADP is a well-known and reputable payroll company, it’s important to note that the concept of “cheapest” can vary depending on several factors. While ADP may offer competitive pricing, it’s not accurate to say that ADP is always the cheapest payroll company in the marketplace. Pricing structures can differ based on factors such as the size of your business, the specific services and features you require, the level of support needed, and any additional customization or add-ons. 

    To determine the most cost-effective option for your business, it’s crucial to evaluate the pricing and offerings of multiple payroll companies, including ADP, along with their suitability for your specific needs. Consider factors such as the size of your business, the complexity of your payroll requirements, the level of customer support you desire, and any additional features or integrations you may need. Requesting quotes from multiple providers and comparing their pricing, features, and services will help you make an informed decision that balances affordability with the necessary functionality and support for your business. 

    Remember, while cost is an important consideration, it’s also essential to prioritize factors such as reliability, service quality, scalability, and compliance support when choosing a payroll processor for your business. 

    When it comes to payroll companies, ADP, Paychex, Paycom, Paylocity, and Gusto are considered best in breed software options. These companies offer a range of features and services to meet the payroll and HR needs of businesses of various sizes. They excel in areas such as user-friendly interfaces, comprehensive service offerings, scalability, compliance support, and innovative technology. However, it’s important to note that buyers should also consider the pros and cons of working with local payroll companies instead of national providers.  

    Explore your payroll options and evaluate them individually based on your business’s needs

    Local companies may offer personalized service, in-depth knowledge of local regulations, and potentially lower costs. To make an informed decision, readers are encouraged to explore the top payroll providers in their own state and evaluate them based on their specific needs and priorities. This ensures that they find a payroll company that aligns with their business requirements while taking advantage of the expertise and resources available locally. 

    To learn more about the pros and cons of working with a local payroll company as opposed to a national company, read our article here.