Their business model doesn't rely on charging for HR software. Their HR software is free and will continue to be free forever. This is just a straight up win for consumers.
Is Facebook, or Hacker News, or reddit "price dumping" its free software?
The same can be said about the Zenefits users. They don't care about the 5 dollars per user that they can make in revenue. They care about the x000 dollars in insurance dollars that they make off of them.
The customer is the insurance companies, not the users. The users are the product, so of course they give it away for free.