Top 7 Paychex competitors for HR outsourcing and payroll management

Many HR leaders are dissatisfied with their current technology vendors: a 2022 PwC survey reveals that 36% are somewhat or very likely to switch vendors when their subscription ends.

This goes to show that selecting the right HR and payroll system, especially for distributed, global teams,  isn’t an easy task. They need a reliable, scalable system that will help streamline HR processes, eliminate busy work, and automate workflows so that HR teams have more time and resources for strategic, value-adding tasks that drive business outcomes.

This article explores top Paychex competitors and alternatives, helping you make an informed choice about which payroll management tool best fits your organization's needs and goals.

What is Paychex?

Paychex is a human capital management (HCM) and payroll software solution designed to streamline HR, payroll, and benefits administration for businesses of all sizes. Founded in 1971, Paychex has grown to become one of the leading providers of payroll and HR services in the US.

Paychex works by centralizing various HR and payroll functions into a single, cloud-based platform called Paychex Flex, with a mobile app available. This allows businesses to manage their workforce more efficiently, from hiring and onboarding to payroll processing, benefits administration, and more. 

 Core features of Paychex's software include:

• Payroll processing: Payroll entry, direct deposit, wage garnishment, W-2 delivery
• Taxes: Tax calculation, automatic tax payment, tax filing
• Benefits administration: Benefits enrollment and management, pre-tax deductions, employee self-service
• Time and attendance tracking: Recording employee hours, attendance, paid time off, sick time, and schedules
• HR analytics and reporting: Customizable and pre-built reports on payroll costs, employee turnover, and other HR metrics

With these features in mind, users typically highlight the following Paychex benefits: ease of use, integrations, and detailed, customizable reports.

Top 7 Paychex competitors and alternatives

There are many companies like Paychex, with similar sets of payroll and HR tools for businesses looking to streamline and automate their processes. Below, we’ll walk you through some of the most popular Paychex alternatives, their key features and common use cases, so that you can determine which would suit your business best.

1. Rippling

Rippling offers full-service payroll that’s built on top of a single source of truth for employee data. That means your employee data isn’t tied to one specific app—it’s the same across payroll, time and attendance, onboarding, performance management, and any other apps you use within our unified platform—the only workforce management system to unify HR, payroll, IT, and Spend in a single platform.

What does that mean for you and your team? For starters, you have a single source of truth for up-to-the-minute employee information. It also means that your team doesn’t have to reenter information across systems when an employee gets promoted or moves to a different city to work remotely. From changing security permissions to updating PTO policies, Rippling triggers automatic updates to employee information in a single flow. This is especially beneficial for small businesses. It allows you to do more with less—less money, less headcount, and less time. And all with a 100% error-free guarantee.

Rippling Payroll is intuitive and easy to use. It also offers 500+ integrations, automatic and accurate tax registration and filing, and a dedicated mobile app where your employees can view their W-2s and paystubs, submit expenses directly, and more. With Rippling, you can: 

• Pay employees and contractors in the same platform
•  Manage time and attendance natively 
• Run unlimited off-cycle pay runs at no extra cost 
• Set up multiple pay schedules, pay rates, and pay types in just a few clicks 
• Add recurring reimbursements (like cell phone payments, gym memberships, etc.) that are automatically paid out every pay period, monthly, or at whatever interval you choose
• Automatically calculate prorated pay runs for new or promoted employees 
• Manage all currency conversions, including payroll adjustments 
• Automatically calculate overtime for every country 
• Make changes after submitting payroll

Core features:

• Full-service payroll processing with global capabilities
• Employee benefits administration
• Time and attendance tracking
• Learning management
• HRIS for employee data management
• Device management 
• Identity & access management
• Expense management
• PEO services
• Global employer of record 
• Global contractor payments
• Workforce analytics
• Employee self-service portal

Best suited for: Rippling is ideal for businesses of all sizes (especially those in growth mode), tech-savvy companies, and organizations with a distributed workforce. It's particularly well-suited for:

• Startups and scale-ups: Rippling can manage complexities that arise with growth, such as multi-state (and multi-country) payroll and benefits administration
• Tech-forward companies: Rippling is the only HCM that unifies HR with IT
• Companies with remote or distributed teams: Rippling can help companies hire and pay employees compliantly in 185+ countries

2. Gusto

Gusto is a cloud-based payroll and HR platform designed for small to medium-sized businesses. Gusto boasts a user-friendly interface and workflows and affordable pricing for smaller teams, but may require a lot of manual data entry, especially when adding new team members.

Core features:

• Payroll processing for employees and contractors
• Benefits administration with a beyond-standard benefits offering
• Time tracking and attendance with time off management tools
• Employee self-service portal
• Automated tax filing and compliance support

Best suited for: Gusto is ideal for small businesses with limited distribution and startups with a local workforce, looking for an all-in-one, user-friendly payroll and HR solution. Gusto is particularly well-suited for small teams that hire both employees and contractors and need flexible plans with a possibility to choose add-ons to cater to their changing needs.

3. Paycor

Paycor offers a comprehensive HCM platform that includes payroll services and HR functions, including talent management solutions. Paycor comes with a mobile app, offers expense management tools in higher tiers, and 1:1 HR expert support.

Core features:

• Automated payroll processing
• Federal and state tax compliance
• Advanced payroll analytics
• Benefits administration
• 300+ integrations, including talent acquisition, benefits, and productivity tools

Best suited for: Paycor is a good fit for small and mid-sized businesses that need no advanced payroll features and are looking for a simple solution to streamline and automate payroll and HR workflows for their local workforce.

4. QuickBooks Payroll

QuickBooks is a widely-used accounting software developed by Intuit, primarily designed for small to medium-sized businesses. While it's primarily known for its accounting features, QuickBooks also offers payroll services through QuickBooks Payroll. It’s user-friendly and comes with a mobile app.

Core features:

• Automated payroll processing
• Tax calculations and filings
• Compliance management
• Employee self-service portal
• Health benefits administration

Best suited for: QuickBooks Payroll is ideal for small businesses already using QuickBooks for accounting. It's particularly beneficial for businesses looking for seamless integration between their accounting and payroll systems, and those who want a straightforward, easy-to-use payroll solution.

5. ADP Payroll

ADP is one of the largest HR and payroll providers globally. It has a comprehensive offering of HR and payroll tools, including PEO services, workforce management tools, recruiting and talent management, and standalone compliance. The platform is scalable, so it can cater to businesses of all sizes. 

Core features:

• Payroll processing and tax filing
• Time and attendance management
• Employee benefits administration
• HR management and compliance tools
• AI-driven data analytics and reporting

Best suited for: ADP's solutions can accommodate businesses of all sizes, but they're particularly well-suited for medium to large enterprises with complex payroll needs and budgets that can accommodate a relatively expensive tool. ADP is also a good choice for multinational companies due to its global payroll capabilities, although some users complain of lack of local customization options.

6. Paycom

Paycom provides a full-service, cloud-based HCM solution. Although it may be a tad complex for small businesses, it provides single-system architecture for all HR and payroll functions, in-depth reporting, and employee self-service capabilities.

Core features:

• Complete online payroll processing
• Preboarding options for new team members
• ATS & talent management capabilities
• Learning and performance management
• Extensive customizable and predefined reports

Best suited for: Paycom is best for medium to large businesses looking for a single-database HRIS solution, as it may be too expensive for small teams. It's particularly strong for companies that prioritize employee self-service features and want a highly integrated system for all their HR and payroll needs.

7. OnPay

OnPay is a cloud-based payroll service provider targeting small to medium-sized businesses. It can handle complex payroll scenarios, including multi-state and multiple pay rates. The platform boasts an intuitive, user-friendly interface and strong customer support, and you can test it during one month for free. All features are available in the single plan OnPay offers.

Core features:

• Full-service payroll processing for full-time employees and contractors
• Automated tax filings with self-service employee onboarding
• HR resources library and compliance support
• Benefits administration with support from brokers across all 50 states
• Integrations with popular accounting platforms

Best suited for: OnPay is ideal for small businesses and startups, especially those experiencing fast growth, looking for an affordable, easy-to-use payroll solution that doesn’t charge for additional features. It’s particularly useful if you need support with building your benefits package or taxes.

How to choose HR and payroll software

Selecting the right HR and payroll software is crucial for businesses looking to optimize their workforce management. Getting this choice right from the start saves you the time and effort of switching providers down the road, enabling you to scale your processes more easily as your team grows or expands to more regions.

Here are five key tips to guide your decision-making process:

Analyze the pricing structure

Transparent pricing helps you budget effectively and avoid unexpected costs. Do you pay by seat? Are there paid add-ons you might need in the future? Request detailed quotes from multiple HR and payroll providers, including all potential fees. For example, ask about costs for additional users, modules, or data storage to understand the total cost of ownership.

Consider available integrations

Seamless integrations improve efficiency and data accuracy across your tech stack. List your current and planned software tools, then check each payroll provider's integration capabilities. Look for pre-built connectors with popular accounting, time tracking, and benefits platforms.

Evaluate customer support and training

Robust support ensures smooth implementation and ongoing success with the software. Before making the final decision, you should test each vendor's support responsiveness. Request a sample training plan and ask about available resources like video tutorials, knowledge bases, and live chat support.

Assess scalability and flexibility

Your chosen software should grow with your business and adapt to changing needs. Will the system be able to support mass onboarding or cover additional countries you might hire from? Review the software's ability to handle increasing employee numbers and complex pay structures. Ask vendors about their product roadmap and how they accommodate clients' evolving requirements.

Prioritize user experience

Intuitive interfaces increase adoption rates and reduce time spent on administrative tasks. Request demos or trial periods to test the software's ease of use. Involve end-users from various departments (like payroll managers, HR specialists, IT admins) in the evaluation process to gather diverse perspectives on the user experience.

Budget-friendly HR and payroll management with Rippling

While Paychex has long been a staple in the HR and payroll industry, alternatives like Rippling have opened up new possibilities for companies seeking comprehensive, user-friendly options.

Rippling unifies HR, payroll, IT, and Spend, empowering your organization to become more productive with time-saving automations and better decision-making that turns your HR department into a strategic partner for your company. And unlike the siloed modules in traditional HCMs, every app in Rippling is built on a single source of truth for employee data, so anyone in your company can go from novice to Rippling expert in no time.

With Rippling, you can automate any part of the employee lifecycle, putting processes on autopilot with custom-built workflows, no matter how complex they are. The best part? Anyone can build custom automations in Rippling, without any code. The time you and your teams save by eliminating manual processes and busy work mean more time and resources to grow your business.Don't let outdated systems hold your business back. Embrace the future of workforce management with Rippling and experience the difference that a unified, modern HR and payroll solution can make.

Paychex competitors FAQs

Who is Paychex's biggest competitor?

Rippling is one of Paychex's strongest competitors. Both companies offer comprehensive payroll and HR solutions for businesses of all sizes, but when it comes to Rippling vs Paychex, the former has a much higher customer satisfaction score, offers EOR services and IT tools for device management, and comes with a wider range of integrations. Rippling also offers native global payroll services, while Paychex uses an external partner.

What is the difference between Paychex and Paychex Flex?

Paychex is the company name, while Paychex Flex is the company’s cloud-based HCM software platform

Is Paychex the same as QuickBooks?

No, Paychex and QuickBooks are different companies with distinct offerings. Paychex specializes in payroll and HR solutions, while QuickBooks is primarily known for accounting software. However, both offer some overlapping features in payroll processing, and they can often integrate with each other for more comprehensive business management.

How do Paychex alternatives compare in terms of pricing?

Pricing for Paychex alternatives varies widely depending on the features offered and the size of your business. It's important to request detailed quotes and consider long-term costs when comparing options.

This blog is based on information available to Rippling as of September 19, 2024.

Disclaimer: Rippling and its affiliates do not provide tax, accounting, or legal advice. This material has been prepared for informational purposes only, and is not intended to provide or be relied on for tax, accounting, or legal advice. You should consult your own tax, accounting, and legal advisors before engaging in any related activities or transactions.