Do you know what it's like to manage employee time cards and payroll checks by hand? In the past, this was one of the most major aspects of a company accountant's job. Fortunately, payroll automation software has taken a lot of the headache, hassle, and human error out of paycheck distribution.
With an automated system, a computer keeps track of employee wages and distributes checks. Many of these systems can also set aside funds and automatically pay taxes on a weekly, monthly, or quarterly basis. Payroll automation leaves room for accountants to focus on more pressing matters.
Two of the most popular payroll systems are OnPay and Gusto. These are both computerized software options with different payroll features, optimized for businesses with anywhere from one to one thousand employees. But there are some key differences that I've outlined here to help you decide which better suits your business.
Overview of OnPay and Gusto
Unique OnPay Features
Unique Gusto Features
OnPay comes with a truly impressive suite of features. In addition to all the basics, you also get features including:
The system also allows you to sign up for a variety of dental and health benefits. There are plans available for all fifty states. You can add disability, vision, and life insurance to your employee benefits at any time, as well as administration of workers' compensation.
You can have all of your 1099s and W-2s generated through the software. For a fee, OnPay will distribute these directly to your employees.
The employee files have all important personal, contact, payroll, and tax information for your employees. In addition, you can generate over 40 tax and payroll reports. That said, your options for customizing reports do tend to be limited.
Payroll is offered for all fifty states in the US, so you can manage multi-state payrolls without needing to pay an additional fee. There are options to allow employee onboarding or to enter employee information yourself.
Multiple HR tools are available, including:
There's no extra fee for bonus checks or commission checks. It's also possible to assign multiple employee rates, and the system automatically calculates and administrates necessary overtime pay.
There are all of the basic features you'd need to automate your payroll process. Some of the included capabilities are:
During the initial program setup, you can work with a software employee to be guided through the process. The company helps you learn how to automate and manage your payroll system, plus it includes administration of retirement and healthcare plans. You also get total access to resources and HR professionals with the Concierge plan.
Gusto includes a comprehensive employee onboarding feature. It lets your employees access your payroll system and complete the onboarding process themselves. You need to enter their name and email, but then Gusto can email them so they can complete the process.
There are also comprehensive functions to process your payroll taxes so you don't have to generate forms by hand. Some of the forms that the software will prepare for you include:
The software can administer different benefits accounts including:
The AutoPilot system lets you automate payroll completely from week to week when you have a system that doesn't change much.
Since each employee can create an account in the system, they have access to digital pay stubs. You also have ideal reporting options. It's easy to view the year-to-date earnings of any employee, a summary of employee benefits, a summary of your contractors, balances for time off, and a complete payroll journal.
You can customize different reports by year and export or save them. There are also many third party software integrations for nearly every mainstream accounting software used by small businesses.
OnPay comes with a more comprehensive suite of features that make payroll administration and tax filing super easy. That said, Gusto does have more customized reporting options.
Ease of Use
OnPay is extremely easy to use, with a dashboard that lets you navigate between payroll, tax, and employee information. Outstanding offers and pending tasks are easily divided.
There are several customization options during setup to help you automate the process, import your existing information, and decide how much control to give employees over their data.
It's easy to find the functions and features. Should you get stuck, you can click on the question mark to see the knowledge center.
Gusto is a very easy software to use. Even if you've never managed payroll before, the interface is intuitive enough that you can find everything you need. There are also helpful reminders on the dashboard to complete pending tasks.
You can use the vertical menu bar to find all the different features and pages. This is also where you'll find the help center, which gives you detailed instructions for setting up and using the different available features.
Support is offered through phone, email, and one-on-one chat during normal business hours.
OnPay wins because of how much easily-readable information is displayed on the dashboard. Both systems are very easy to navigate and learn, though, even if you're a complete beginner.
Pros and Cons of OnPay
Pros and Cons of Gusto
Final Thoughts: Which is Better?
Both payroll management systems are geared toward businesses with less than a thousand employees. They both come with easy options for automating payments and keeping track of financial resources.
OnPay works best for small businesses that only have a handful of employees. It comes with affordable options for a small business budget, and it has the basic features you want in a payroll management system. You can also use a number of different HR resources without increasing your costs.
Gusto is a better management software for larger operations. The employee onboarding process is very streamlined, and payroll setup doesn't take as many steps. That makes it good for people managing dozens of employees. It tends to be fairly pricey, but it can integrate with the majority of complex accounting software options used by entrepreneurs.