Gusto vs Justworks for Contractor Management in 2025
Compare Gusto and Justworks for managing contractors. See pricing, features, and why Kontrable offers a better alternative for businesses working with independent contractors.
Quick Comparison
| Feature | Gusto | Justworks | Better Alternative |
|---|---|---|---|
| Price (10 contractors) | $40/mo + $6/contractor | $49/mo + $8/contractor | $99/mo flat (Kontrable) |
| Payment flow | Through platform | Through platform | Direct (you control) |
| Best for | US payroll + contractors | US PEO + contractors | Contractors only |
| International support | Limited | Limited | Global |
Gusto Overview
Gusto is a popular US-focused payroll and HR platform designed primarily for small businesses with W-2 employees. The platform offers payroll processing, benefits administration, time tracking, and contractor payment features as an add-on to their core employee payroll service.
Gusto charges a base fee ($40/month for the Simple plan) plus $6 per contractor per month. Contractor payments are processed through Gusto's system, and the platform generates 1099 forms at year-end. However, Gusto is primarily built for US payroll, with limited international contractor support.
Justworks Overview
Justworks is a Professional Employer Organization (PEO) that provides payroll, benefits, compliance, and HR tools for US-based businesses. The platform co-employs your W-2 staff and offers contractor payment features as part of their service.
Justworks charges $49 per employee or contractor per month, making it more expensive than Gusto for contractor-only teams. Like Gusto, payments flow through Justworks' platform, and the service is primarily designed for US-based teams with limited international support.
The Problem Both Platforms Share
Both Gusto and Justworks are built for US payroll and employee management. This makes sense if you need:
- W-2 payroll processing
- Benefits administration
- US tax compliance
- PEO services (Justworks)
But if you're working with independent contractors (especially international ones) who handle their own taxes and already have payment accounts? You're paying $6-$8 per contractor per month for infrastructure built for employee payroll.
With 10 contractors, that's $100-$129/month. With 25 contractors, you're looking at $190-$249/month just to route contractor payments through a payroll system designed for employees.
A Different Approach: Kontrable
We built Kontrable specifically for businesses working with contractors (not employees):
- Direct payments: Pay via your Wise/PayPal/Payoneer (no middleman)
- $99/month flat: Up to 25 contractors (vs $100-$249 on payroll platforms)
- Contractor-focused: Contracts, invoices, milestones, payment tracking
- Global support: Works with contractors anywhere, not just the US
Instead of routing payments through a payroll platform, you pay contractors directly via Wise, PayPal, or Payoneer—just like you would anyway. Kontrable keeps the source of truth: contracts, milestones, approvals, payment proofs, and contractor confirmations.
You get a clean audit trail for finance, contractors get paid faster (especially international ones), and you save money by not paying for employee payroll infrastructure you don't need.
Who Should Choose What
Choose Gusto if:
You have US W-2 employees and need full payroll processing with benefits, and you have a few US-based contractors you want to pay through the same system.
Choose Justworks if:
You want PEO services for your US employees (co-employment, benefits, compliance) and need to pay a few US contractors through the same platform.
Choose Kontrable if:
You're working with 5-25 independent contractors (US or international) who handle their own taxes, you want to pay them directly via Wise/PayPal/Payoneer, and you need a clean system to track contracts, milestones, approvals, and payment confirmations—without paying for employee payroll infrastructure.
Frequently Asked Questions
Do I need payroll software to pay contractors?
No. Payroll software is for W-2 employees. Independent contractors handle their own taxes and can be paid directly via Wise, PayPal, Payoneer, or bank transfer. You just need solid contracts, clear scopes, and good records.
What about 1099 forms?
If you're paying US contractors over $600/year, you need to file 1099-NEC forms. Kontrable tracks all payments and can export the data you need for 1099 filing (you can file directly or use a service like Tax1099 or TaxBandits).
Can I pay international contractors with Gusto or Justworks?
Both platforms have limited international support. Kontrable works with contractors anywhere—you pay them directly via Wise, PayPal, or Payoneer in their local currency, and Kontrable tracks everything for your audit trail.
What's the real cost difference?
With 10 contractors: Gusto costs $100/month, Justworks costs $490/month, Kontrable costs $99/month. With 25 contractors: Gusto costs $190/month, Justworks costs $1,225/month, Kontrable still costs $99/month.