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Gusto vs Justworks (2026)

Updated October 2026 · 6 min read

Gusto and Justworks both run payroll for startups, but they are fundamentally different businesses. Gusto is payroll and HR software: you stay the employer of record and Gusto does the calculations, filings, and benefits administration for you. Justworks is a PEO (professional employer organization): under a co-employment arrangement, Justworks becomes the employer of record for tax and benefits purposes and gives you access to its master health plans and workers' compensation policy. That one difference drives the entire pricing gap below.

Quick pricing comparison

Gusto (base fee + per person): Simple is $49/month plus $6 per person; Plus is $80/month plus $12 per person; Premium is $180/month plus $22 per person. A Contractor Only plan runs $35/month plus $6 per contractor. Gusto raised the Simple base fee from $40 to $49 in March 2026.

Justworks Payroll (base fee + per employee): $50/month plus $8 per employee per month. This is Justworks' non-PEO payroll option.

Justworks PEO (flat per employee, no base fee): Basic is $79 per employee per month; Plus is $124 per employee per month. Both PEO plans require at least two W-2 employees.

Note: some older reviews still quote Justworks at $59 (Basic) and $99 (Plus) per employee per month. The $79/$124 figures come from reviews updated October 2026 and reflect Justworks' current published list prices. Rates can also vary by headcount, so confirm on Justworks' pricing page before signing.

Gusto: payroll and HR software

Gusto is built around doing payroll well and cheaply. Every plan includes unlimited payroll runs, automatic federal, state, and local tax filing, W-2 and 1099 generation, employee self-service, and direct deposit. Simple covers single-state payroll; Plus adds multi-state payroll, next-day direct deposit, time tracking, and project tracking; Premium adds a dedicated HR advisor, certified HR experts, compliance alerts, and priority support.

Gusto also acts as a licensed benefits broker: health insurance administration is included when Gusto is your broker, while integrating an outside broker costs an extra $6 per eligible employee per month on Plus and is included on Premium. Benefits premiums themselves are billed on top of plan fees, as they are everywhere.

Watch for: Simple is single-state only, so hiring across state lines pushes you to Plus. Next-day direct deposit is not on Simple (it runs on Plus and above). State tax registration costs a one-time $200 per new state. Gusto's international Employer of Record offering is handled through a partnership with Remote at around $599 per employee per month, and since May 2026 new EOR customers have been referred directly to Remote.

Justworks: PEO (and payroll)

Justworks' core product is its PEO. PEO Basic ($79 per employee per month) bundles payroll and tax filings with a workers' comp master policy, employment practices liability insurance (EPLI), state unemployment insurance administration, 401(k) access, HSA/FSA and commuter benefits, standard HR consulting, and 24/7 support. PEO Plus ($124 per employee per month) adds medical, dental, and vision plan administration with COBRA, plus mental health resources, One Medical, and Kindbody fertility perks where available.

The Payroll plan ($50 plus $8 per employee) is the non-PEO option: payroll, taxes, basic HR tools, and support, with health insurance available as an $8-per-employee add-on plus premiums. Justworks also publishes prices for add-ons: time tracking at $8 per employee per month, US contractors at $8 per month (only in months you pay them), international contractors at $39 per month plus exchange-rate fees, and an international EOR at $599 per employee per month. There is no implementation fee.

Watch for: workers' comp is charged as a percentage of wages on top of the PEO plan fee, and health, dental, vision, life, and disability premiums are billed on top too. The PEO plans need at least two W-2 employees, so a solo founder cannot use them. PEO fees are billed for every active employee, including staff on leave.

What a 10-person startup actually pays

The math makes the structural difference concrete. For 10 employees:

These are list prices before benefits premiums, workers' comp, and add-ons. The PEO plans look expensive because they are doing more: master benefits access, workers' comp coverage, EPLI, and compliance offloaded under co-employment. The question is whether your startup needs that yet.

PEO vs payroll software: what you are actually buying

With Gusto, you are the employer of record. You hold the workers' comp policy, you choose (or broker) your own health plans, and Gusto handles the mechanics: payroll calculations, tax filings, onboarding, and benefits administration. That is why it costs $109/month for 10 people instead of $790. It is the right structure when your team is small, your benefits needs are simple, and you would rather spend the savings on salaries.

With Justworks PEO, Justworks co-employs your team and becomes the employer of record for tax and benefits purposes. You get pooled access to large-group health plans, a master workers' comp policy, and EPLI that a 10-person startup could not negotiate on its own. Justworks is an IRS-certified PEO (CPEO) with ESAC accreditation, which is the industry's financial-assurance gold standard. The tradeoff is cost: roughly 7x Gusto Simple for a 10-person team on PEO Basic, and you give up some control over benefits plan design.

Benefits, contractors, and international hiring

Benefits: Justworks PEO Plus exists for one reason: rich, pooled benefits (medical, dental, vision, COBRA, mental health, One Medical, Kindbody) that make a small startup competitive with bigger employers. Gusto administers benefits as your broker instead of pooling them, which is cheaper but does not unlock the same large-group plan access.

Contractors: Gusto's Contractor Only plan ($35/month + $6 per contractor, often promoted at $0 for the first six months) is purpose-built for teams that only pay 1099 contractors. Justworks charges $8 per US contractor per month only in months you pay them, and $39 per month for international contractors plus exchange fees.

International hiring: both are US-first platforms with international contractor payments as the main tool. Gusto pays international contractors in 120+ countries and routes full-time EOR through Remote. Justworks offers its own EOR at $599 per employee per month for full-time international hires.

Ease of use: Gusto is consistently praised for the most intuitive payroll interface in the category, and employees get the Gusto Wallet app for pay stubs and time-off requests. Justworks is also well rated and offers 24/7 human support on the PEO plans, which Gusto reserves for its upper tiers.

Our pick: Gusto for most early startups: Simple at $109/month for a 10-person team covers payroll, taxes, W-2s and 1099s at a fraction of PEO pricing, and Plus at $200/month adds multi-state payroll and time tracking as you grow. Justworks PEO Plus if you need pooled large-group health benefits and full compliance offloading now, and the ~$1,240/month for 10 employees is worth it to you. Justworks Payroll ($130/month for 10) is the dark horse: cheap payroll with the option to upgrade to the PEO later without switching providers.

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