ADP vs Paychex – Payroll Processing Providers Compared

Kelly Zawalski's Profile

ADP vs Paychex

We are a 75 person private Company looking to transition from an independent payroll service provider to a SAS 70 Type II provider this year. We are in the process of evaluating ADP vs. paychex, but are open to considering other providers, as well. Top priorities are payroll processing, customized reporting and time and attendance.  Eventually, we will look to adopt HRIS capabilities with the selected provider. 

Initial assessment of ADP vs Paychex is: ADP is an industry leader with scale, intuitive web interface, integrated reporting suite, so-so performance evaluation automation capabilities with base level HR functionality, and team-based support model.   Assessment of Paychex is: dedicated customer support representative, new integrated OneSource interface is getting closer to ADP look/feel but is integration of multiple products. (Not sure if this impacts quality of service/reporting capabilities.)  

For those of you with experience with one or both of these providers, I would appreciate your input on the following:

ADP Team Support model vs. Paychex dedicated rep model; the current service level with our existing provider is excellent so this is important for us

Experiences, good or bad, with new Paychex OneSource product

Cross-module reporting capabilities with Paychex One Source (i..e. Time/Job Costing detail combined with Payroll data)

Other SAS 70 Type II providers that we should consider
 

 

Answers

Member's Profile

I've done some similar analysis, though not specifically with ADP and Paychex. One firm to consider is Paylocity. They are the new generation, web-server based systems and services.
Good luck!
-Dave

To comment, and for full access, login or register
Member's Profile

In addition to the excellent insights from the community on this page, take a look at this free resource here on Proformative titled:

"PayChex vs ADP Info"

http://www.proformative.com/resources/paychex-vs-adp-info

Enjoy!

Best... Sarah

To comment, and for full access, login or register
Proformative Advisor
Member's Profile

I agree, we switched to paylocity last year. While ADP definitely has some of the best bells and whistles, Paylocity has a good portion of them as well. The ones that ADP has vs Paylocity weren't worth the 2x cost of ADP vs Paylocity.

To comment, and for full access, login or register
Member's Profile

I am VP Finance and HR for a multi state operation with 850 associates. Currently with ADP Payexpert and evaluating Paylocity now and with not much time left to complete the analysis. Problems in ADP are allowing HR managers at locations to access data in a Read Only manner for only their location and current without HRB for benefits management(but considering adding it if we stay with ADP). Any thoughts?

To comment, and for full access, login or register
Member's Profile

We have some very specific experience with Paylocity and multi location. We were happy with them until we have had issues with payroll tax filings in the US Virgin Islands. They have not been able to do what we need. Other than that, they have been fine.

To comment, and for full access, login or register
Member's Profile

ADP's reporting capabilities and access to "your" data is difficult if not impossible. We're slightly larger user of ADP products and are looking at Ultipro and Kronos. ADP is not an integrated platform its a mainframe system with limitations

To comment, and for full access, login or register
Member's Profile

Are you on ADP current platform? We were on their legacy platform until a year ago. We looked at Ultipro and Workday but decided to upgrade to ADP's Workforce solution. We are using them for payroll, HRIS, and time keeping software. We now have a better reporting system then their older reportsmith reportwriter giving me access to all data on the fly. We got assigned to a different service team with the new software and our service has dramatically improved. And it was much less expensive than the other 2 options

To comment, and for full access, login or register
Member's Profile

we already use the workforce solution and our experience is that if you like their standard reports its fine but anything else is almost impossible to get without getting their programmers or even a third party programmer involved.

To comment, and for full access, login or register
Member's Profile

I have extensive experience with ADP and some experience with Paychex. I prefer the service levels provided by Paychex over ADP. Both companies accurately served my basic needs of providing weekly/bi-weekly/semi-monthly payrolls. They also both did a good job of taking care of tax reporting.

The biggest complaint I have about ADP is with access to "My" data. If you want to get data in any format that is different from a canned report, you will have to pay for it. There is no reason companies should be forced to pay for ADP to develop a report when simple access to the database would work just as well.

My other big issue is with the service levels at ADP. Typically, you will be assigned to a service team. They do a good job of selling companies on the benefits of having a team that can help you, but, in reality, the assistance is limited and when you are under the gun with an immediate need, you are very likely to be disappointed. I found Paychex to be very responsive and willing to help me with the business needs that arose.

Having said all of this, ADP is very good for extremely large companies that have multi-state needs. I ran a 75 person company, (obviously not a large company), with locations in 11 states and had no issues with regard to tax reporting, which can get very complex when you have to file quarterly returns. Unfortunately, my business was in Las Vegas and I had to work with people in San Francisco. Not convenient. I can not speak to Paychex's capabilities in this arena as my experience with Paychex was in a single state operation.

An earlier posting recommended you look at Paylocity. I offer that you should take that a step further and look at a few of the local/regional payroll companies out there, especially if you are a single location business and do not anticipate crossing multiple state lines. If you are comfortable the smaller company can handle your tax reporting requirements, then you will very likely find that their customer service will be very high because they know that is the one area they can compete with ADP on and win every time.

To comment, and for full access, login or register
Member's Profile

Great point about local providers. One thing about the big guys is that their service level is much (and I mean a lot) lower. I got very frustrated with ADP a few years back with their customer support. It got better after being a very squeaky wheel, but always nicer not to have to complain in the first place.

To comment, and for full access, login or register
Proformative Advisor
Member's Profile

I recommend PBI if Carle Place, NY.

They are no better or worse than ADP or Paychex?

But, they floated two payrolls after 9/11 for me when we couldn't get into our offices and deposit a/r checks. They may never ever do this again, but because of their concern for the clients, I'm a loyal customer and tell everyone about them.

PBI +1 (516) 338-5454

To comment, and for full access, login or register
Proformative Advisor
Member's Profile

Payroll Dynamics, Inc. in Hauppauge, NY +1 (631) 435-8700
Advantage Payroll Services in Freeport, NY +1 (516) 931-8400

Both excellent, responsive small payroll companies

To comment, and for full access, login or register
Member's Profile

We are in the process of moving from Paychex to ADP Workforce. The history of ADP and Paychex is interesting. As I understand it Paychex was formed to fill a market gap that ADP was not serving or was underserving - employers with less than 10 employees.

Since then, Paychex and ADP have expanded into each others' markets in terms of employer size, so officially Paychex also serves large employers and ADP also serves small employers.

We have about 45 employees, and working with Paychex it was evident to me that their 'sweet spot' was companies with less than 10 employees. Certain aspects of our 401k, for example, were too complicated for Paychex systems and had to be handled manually, outside of their technology solutions (creating duplication between the online version which was 'wrong and should be ignored' and the manual version, which we had to request and had often at least a one week turnaround to obtain). Our 401k is not complicated at all for our size so this was telling to me.

In addition, Paychex technology is from my experience well behind ADPs. Even Paychex employees would openly discuss this with me (in the last few years they have been pouring money into R&D on the technology front but they have a lot of catching up to do). According to some Paychex employees I spoke to, historically Paychex was anti-technology and it seems it was not until they were way behind that they realized technology was crucial and started to focus on it. For me, the reliability, flexibiliy and speed of the technology is absolutely critical so this was a major motivator for us to move.

Another comment I would make is that both ADP and Paychex try to upsell you on their committed HR person/dedicated rep solutions. We had this with Paychex and I have found that the value of it really depends on which reps you are assigned. Some of them are awesome and others are mediocre. If you get someone mediocre, you may as well just have the basic solution and be calling into the general customer service center - you will probably get the same person answering the phone. At Paychex (I can't speak for ADP because we did not sign up for this option) the awesome reps are often promoted so you can be left with the mediocre ones. There was fairly high turnover with the reps on the payroll side, although we had an awesome 401k rep who was with us the whole time (she was burdened by mediocre technology but delivered us awesome customer service).

In coming to the decision to move to ADP, I've talked to a lot of customers of both ADP and Paychex, and also 3rd party vendors who work with both companies. My overall view is: don't expect perfection from either. Both will make mistakes. The differentiating points I have heard over and over again are, as mentioned above, 1) ADP is ahead on technology, and 2) if you are a larger employer, ADP may be better able to handle your complexities.

To comment, and for full access, login or register
Member's Profile

All payroll services generally do OK when everything is as it is supposed to be and can correct simple errors, but ADP has particularly weak service for small to mid-sized companies (I think they do better at very large companies). If you speak with people who work in the "rent a CFO/Controller" roles who deal with lots of payroll systems for small sized companies, they all have ADP support negative experiences.

It's a function of their process: when you call in you speak with someone with almost no level of knowledge, their job is to assign a case number. Following up on a case number once you have one is often frustrating as you rarely talk with the same person who agreed to "fix" the problem previously.

Secondly, their ability to deal with problems of medium and greater compplexity is sorely lacking. They are supposed to be payroll experts, but you find many times you know more about subjects than they do. One example I had was trying to shut down reporting in states in which i no longer had employees (and felt it highly unlikley i would engage employees in that state again in the future). You would think they would be good at helping with something like that, but in fact they were terrible. After I finally figured out the forms to submit myself and closed them off, I would find ADP would have reopened the state.

To comment, and for full access, login or register
Member's Profile

I focus on cost, and outside of doing the payroll in-house I found ADP to be the most competitive from the cost perspective. I have not had any service issues and almost never have to actually call them. I have not shopped the rates in over two years, but ADP also has not given me reason to by raising rates.

To comment, and for full access, login or register
Proformative Advisor
Member's Profile

We experienced the exact same frustrations which was a primary driver for our move to Paylocity.

To comment, and for full access, login or register
Member's Profile

When I took over the accounting for a small business (staff of 10) they were using ADP.ADP's customer service was miserable and they charged premium prices.
After one year of being frustrated, I phoned Paychex and have been happy ever sense.
Their price was 33% lower than ADP's and their customer service was 33% better (ie quicker payroll delivery, quicker return phone calls).
I think that ADP main focus is on bigger businesses.

To comment, and for full access, login or register
Member's Profile

I couldn't agree more. ADP customer service has been spotty and sporadic. Since our move from ADP to Paychex, the payroll processing efficiency has gone up 200% with better customer services and measurably lower fees.

To comment, and for full access, login or register