This analysis describes what Gusto's agreement states, permits, or reserves. It does not constitute a legal determination about enforceability. Regulatory applicability and practical outcomes may vary by jurisdiction, enforcement context, and individual circumstances. Read our methodology
This allocation of roles establishes the contractual and legal framework for data handling responsibilities. It clarifies that employers, not Gusto, bear primary responsibility for determining how employee data is used and for compliance with data protection obligations.
The updated Privacy Policy now explicitly states it covers retirement account management (401k, SEP IRA, IRA accounts) and adds Stripe alongside Plaid as a third-party service provider that collects financial institution data. The policy restructures how it describes Gusto's role in different contexts: when Gusto acts as a service provider processing payroll or other data on behalf of employers, when it acts as an employer itself, or when it operates as a co-employer under a professional organization (PEO) arrangement, with separate privacy notices applying in each case. The policy introduces a new commitment that de-identified data will not be re-identified except to verify compliance with applicable law. If you connect a bank account through Stripe, that data will be treated under Stripe's Privacy Policy, which you should review separately.
View change record →The updated terms make explicit that using Gusto's background check service constitutes a binding agreement. Previously, the terms of the service relationship may have been less clearly stated. Now, the agreement clarifies that an authorized signatory represents they have authority to bind the organization, and that three actions trigger binding acceptance: checking a box, initiating a background check, or accessing the service. This means employers should ensure the person clicking through has actual authority to commit the organization to the full Background Check Customer Agreement before proceeding.
View change record →The updated terms now explicitly state that employers accept mandatory individual arbitration and waive the right to participate in class-action lawsuits or pursue relief in court with a jury trial. This significantly limits employers' ability to challenge Gusto's practices collectively or seek resolution through the court system. Any disputes employers have with Gusto must be resolved individually through arbitration, which typically involves private, binding proceedings with limited appeal options and discovery rights compared to court litigation.
View change record →Under this provision, employees' personal information is processed according to determinations made by their employer as the data controller. Gusto's processing activities are bounded by the employer's instructions and purposes, rather than Gusto independently determining data use.
How other platforms handle this
We collect information about you when you shop in our stores, including through store cameras, loyalty programs, payment processing systems, and other in-store technologies. This information is used to improve store operations, loss prevention, and marketing.
We target (and measure the performance of) ads to Members, Visitors and others both on and off our Services directly or through a variety of partners, using the following data, whether separately or combined: Data from advertising technologies on and off our Services, like web beacons, pixels, ad ta...
We may de-identify or aggregate your personal information so that it can no longer reasonably identify you, and use such de-identified or aggregated data for any purpose, including sharing with third parties for research, analytics, and marketing purposes, without restriction.
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"When Gusto provides services to employer-customers, it processes employee personal information on behalf of those employers, who act as the data controllers determining the purposes and means of processing. Gusto acts as a service provider or data processor in this context.— Excerpt from Gusto's Gusto Privacy Policy
We read the privacy policies and terms of service of 38 AI platforms. Here is what they say about training, retention, arbitration, and liability.
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This allocation of roles establishes the contractual and legal framework for data handling responsibilities. It clarifies that employers, not Gusto, bear primary responsibility for determining how employee data is used and for compliance with data protection obligations.
Under this provision, employees' personal information is processed according to determinations made by their employer as the data controller. Gusto's processing activities are bounded by the employer's instructions and purposes, rather than Gusto independently determining data use.
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