ADP (company)

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Automatic Data Processing, Inc.
Public company
Traded as
ISINUS0530151036 Edit this on Wikidata
IndustryBusiness services
Founded1949; 71 years ago (1949) (as Automatic Payrolls, Inc.)
Paterson, New Jersey, U.S.
FounderHenry Taub
HeadquartersRoseland, New Jersey, U.S.
Key people
ServicesHuman resource, payroll, tax and benefits administration solutions from a single source
Revenue
  • Increase US$ 13.33 billion
  • (FY June 30, 2018)
  • Increase US$ 2.51 billion
  • (FY June 30, 2018)
  • Decrease US$ 1.62 billion
  • (FY June 30, 2018)
Total assets
  • Decrease US$ 37.09 billion
  • (FY June 30, 2018)
Total equity
  • Decrease US$ 3.46 billion
  • (FY June 30, 2018)
Number of employees
  • ~57,000
  • (FY June 30, 2018)
Websitewww.adp.com
Footnotes / references
[1]

Automatic Data Processing, Inc., commonly known as ADP, is an American provider of human resources management software and services. Until 2014, ADP was one of four American companies in the S&P 500 to have a AAA credit rating from both Standard & Poor's (S&P) and Moody's.[2][3][4]

History[edit]

An ADP Model 4500 timecard reader

In 1949 Henry Taub founded Automatic Payrolls, Inc. as a manual payroll processing business with his brother Joe Taub. Frank Lautenberg joined the brothers in the company's infancy. In 1957, Lautenberg, after successfully serving in sales and marketing, became a full-fledged partner with the two brothers. In 1961, the company changed its name to Automatic Data Processing, Inc. (ADP), and began using punched card machines, check printing machines, and mainframe computers. ADP went public in 1961 with 300 clients, 125 employees, and revenues of approximately $400,000 USD.[5] The company established a subsidiary in the United Kingdom in 1965. In 1970, Lautenberg was noted as being the president of the company.[6] Also in 1970, the company's stock transitioned from trading on American Stock Exchange to trading on the New York Stock Exchange.[6] It acquired the pioneering online computer services company Time Sharing Limited (TSL) in 1974 and Cyphernetics in 1975. Lautenberg continued in his roles as Chairman and CEO until elected to the United States Senate from New Jersey in 1982.

From 1985 onward, ADP’s annual revenues exceeded the $1 billion mark, with paychecks processed for about 20% of the U.S. workforce. In the 1990s, ADP began acting as a professional employer organization (PEO). Around this time, the company acquired Autonom, a herman company,[citation needed] and the payroll and human resource services company, GSI, headquartered in Paris.[7] In September 1998, ADP acquired UK-based Chessington Computer Centre that supplied administration services to the UK Government.[8]

Kerridge Computer Co. Ltd., a dealer management systems (DMS) provider to auto dealers primarily in the UK was acquired in 2006.[9] In 2007, the ADP Brokerage Service Group was spun off to form Broadridge Financial Solutions, Inc.[10] On February 27, 2017, Automatic Data Processing Inc. confirmed it was closing its office in west Ann Arbor on March 30, 2017. At the time, ADP stated that it had around 56,000 employees worldwide, and that the year prior it had revenues of $12 billion,[11] or $11.7 billion USD in 2016.[12] Also in early 2017, ADP described itself as the "largest provider of HR services in North America, Europe, Latin America and the Pacific Rim".[11]

In January 2018, ADP acquired WorkMarket, a New York City-based software platform company that helps businesses manage freelancers, contractors, and consultants.[13]

Divisions and spinoffs[edit]

Broadridge Financial Solutions[edit]

In 2007, the ADP Brokerage Service Group was spun off to form Broadridge Financial Solutions, Inc. (NYSE: BR), removing about $2 billion USD from ADP's total yearly revenue.[10] ADP distributed one share of Broadridge common stock for every four shares of ADP common stock held by shareholders of record as of the close of business on March 23, 2007.[14]

CDK Global, LLC[edit]

ADP Dealer Services in Ontario

Formerly called ADP Dealer Services, CDK Global was formed October 1, 2014 and provides integrated technology services and solutions to over 27,000 automotive dealerships internationally, as well as vehicle manufacturers.[citation needed] In 2010, ADP acquired the automotive marketing company Cobalt.[15]

BZ Results (Automotive Dealer Services), winner of the 2006 “Innovative Company of the Year”,[16][17] was purchased by ADP in 2006.[18] At the time, BZ Results was valued at $125 million. On April 7, 2014, ADP laid off several Dealer Services associates in a reorganization and 3 days later announced plans to spin off the Dealer Services division as a standalone company.[19] On August 19, 2014, ADP Dealer Services announced that the name of the new company, post-spinoff, would be CDK Global (an acronym for Cobalt, Dealer Services, Kerridge).[20]

Both S&P and Moody's downgraded ADP to AA in April 2014, after the dealer services unit was spun off.[4]

ADP ranked 243 on the Fortune 500 list of the largest United States corporations by revenue.[21]

Controversy[edit]

ADP fired salesperson David Schwartz in 2018 after he questioned the legality of ADP's policies and then reported the company to the U.S. Securities and Exchange Commission and Financial Industry Regulatory Authority. ADP fired Schwartz on July 18, 2018. Since Schwartz's reporting these policies to the Federal Government, ADP sued the salesperson to gag him for "misappropriation of trade secrets" and "breach of duty of loyalty" among other claims and he countered with Whistleblower charges against ADP under the Florida Whistleblower's Protection Act.[22] Among Schwartz’s claims was the allegation that ADP trains and pressures its salespeople to push Simple IRAs rather than SEP IRAs "allowing ADP to hold billions of dollars and generate compounded interest on the money (client employer contributions each payroll period) while they hold it." Another Schwartz claim was that ADP trains, incentivizes, and pressures its salespeople to send "falsifying"[23] social security numbers of new client participants to governments on tax forms so that ADP collects payroll deposits from the client as soon as possible.

References[edit]

  1. ^ "US SEC: Annual Form 10-K (2017), Automatic Data Processing, Inc". U.S. Securities and Exchange Commission. August 3, 2018. Retrieved December 1, 2018.
  2. ^ Rooney, Ben (February 5, 2010). "Buffett's Berkshire loses top S&P credit rating". CNN Money.
  3. ^ Staff (July 27, 2011). "4 AAA-Rated Companies With Attractive Yields". Seeking Alpha.
  4. ^ a b Mead, Charles (April 10, 2014). "ADP Stripped of Top AAA Ratings on Spinoff of Auto-Dealer Unit". Bloomberg Business News.
  5. ^ Yost, Jeffrey R. (2017). Making IT Work: A History of the Computer Services Industry. Cambridge, Massachusetts: The MIT Press. ISBN 978-0-262-03672-6. OCLC 978286108.
  6. ^ a b "Earnings Up 47% for Automatic Data". The Bridgeport Post. Bridgeport, Connecticut. October 28, 1970. p. 62. Retrieved 2018-04-07.
  7. ^ "ADP Signs Agreement to Acquire GSI" (Press release). Arthur Schmidt & Associates. Retrieved 2018-04-07 – via The Free Library.
  8. ^ "Ministers under fire over licence errors". Computer Weekly. February 4, 1999. Archived from the original on May 20, 2013 – via Highbeam Business.
  9. ^ Paige, Michael. "ADP buys UK's Kerridge for $300M". MarketWatch. Retrieved 13 May 2018.
  10. ^ a b "Automatic Data Processing March 2007 Current Report, Form 8-K". EDGAR. March 21, 2007. Retrieved December 26, 2012.
  11. ^ a b Haynes, Jessica (February 28, 2017). "ADP announces more layoffs in Ann Arbor ahead of office closure". Michigan Live. Retrieved March 22, 2017.
  12. ^ "Automatic Data Processing 2016 Annual Report, Form 10-K" (pdf). ADP. July 28, 2016. Retrieved February 8, 2017.
  13. ^ Deutscher, Maria (2018-01-22). "Payroll giant ADP acquires worker management startup WorkMarket". siliconANGLE. Retrieved 2018-01-23.
  14. ^ "Automatic Data Processing April 2007 Current Report, Form 8-K". EDGAR. April 4, 2007. Retrieved December 26, 2012.
  15. ^ "ADP Completes Cobalt Acquisition -- Is It Nirvana?". Dealer. Archived from the original on August 20, 2010.
  16. ^ Sean Wolfington Archived 2007-12-11 at the Wayback Machine. AutoSuccess Magazine. Retrieved March 6, 2007.
  17. ^ Auto Success magazine (pg. 8-10) Archived 2007-11-30 at the Wayback Machine.
  18. ^ Cliff Banks (April 1, 2006). "ADP Bolsters Website Efforts By Buying BZ". WardsAuto.com. Retrieved 2006-12-26.
  19. ^ "ADP plans to spin off dealer-services business". MarketWatch.
  20. ^ "ADP Announces Post-Spin name of its Dealer Services Business". Archived from the original on 2014-08-21. Retrieved 2014-08-19.
  21. ^ "ADP". Fortune. Retrieved 2018-11-25.
  22. ^ March 29, 2019 filing in 20th Judicial Court of Lee County, FL available at http://whistlebl0wer.com/wp-content/uploads/2019/04/ADP-Schwartz.pdf
  23. ^ US department of Justice

External links[edit]

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