11 of 12 director nominees are independent.

DIRECTOR AGE

As of our 2018 Annual Meeting, the average age of our director nominees will be 60 years.

We believe our board composition strikes a balanced approach to director tenure and allows the board to benefit from a mix of newer directors who bring fresh perspectives and seasoned directors who bring continuity and a deep understanding of our complex business.

Six new directors have joined our board since 2014, accounting for over half of our eleven independent director nominees.

As of our 2018 Annual Meeting, the average tenure of our independent directors will be 6.5 years.

Consistent with the stockholders’ advisory vote at our 2017 Annual Meeting of Stockholders, we determined to hold the advisory say-on-pay vote to approve our named executive officer compensation on an annual basis. Therefore, we are asking our stockholders to approve, on an advisory basis, our named executive officer (“NEO”) compensation for fiscal year 2018. Our stockholders will have the opportunity to approve, on an advisory basis, our NEO compensation for fiscal year 2019 at the 2019 Annual Meeting of Stockholders.

The board of directors recommends a vote FOR this resolution because it believes that the policies and practices described in the “Compensation Discussion and Analysis” section beginning on page 30 of this proxy statement are effective in achieving the company’s goals of linking pay to performance and levels of responsibility, encouraging our executive officers to remain focused on both short-term and long-term financial and strategic goals of the company and linking executive performance to stockholder value.

At our 2017 Annual Meeting of Stockholders, our stockholders approved the compensation of our fiscal year 2017 NEOs by a vote of approximately 93% in favor.

We are asking our stockholders to approve the Automatic Data Processing, Inc. 2018 Omnibus Award Plan (“2018 Omnibus Award Plan”). The board of directors adopted the 2018 Omnibus Award Plan on August 2, 2018, subject to stockholder approval at the annual meeting. The purpose of the 2018 Omnibus Award Plan is to provide a means through which the company and its affiliates may attract and retain key personnel and to provide a means whereby directors, officers, employees, consultants and advisors of the company and its affiliates can acquire and maintain an equity interest in the company, or be paid incentive compensation, including incentive compensation measured by reference to the value of the company’s common stock, thereby strengthening their commitment to the welfare of the company and its affiliates and aligning their interests with those of the company’s stockholders.

A summary of the 2018 Omnibus Award Plan can be found beginning on page 73 of this proxy statement and a full copy of the 2018 Omnibus Award Plan is set forth in Appendix B. The board of directors recommends a vote FOR the 2018 Omnibus Award Plan.

We are asking our stockholders to ratify the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for fiscal year 2019. A summary of fees paid to Deloitte & Touche LLP for services provided in fiscal years 2017 and 2018 is provided on page 84 of this proxy statement. The board of directors recommends a vote FOR this ratification.

Fiscal year 2018 reflected growing momentum from our multi-year investments in distribution, product, and operational initiatives. We accelerated the pace of our change and transformation through the launch of our next generation platforms, the completion of our mid-market migrations, our acquisitions of Global Cash Card and WorkMarket, the continued execution of our service alignment initiative, and the launch of our voluntary early retirement program.

ADP’s client-centric focus and drive to meet the evolving needs of the global HCM market through leading-edge product and unparalleled service delivered robust financial performance that contributed to an improvement in client retention and a sustained acceleration in our new business bookings. Other key business results in fiscal year 2018 continued to reflect a strong enterprise with solid revenue growth, improved margins, consistent, healthy cash flows and low capital expenditure requirements.

We continue to see ample opportunity to add value in new and innovative ways given our strong fiscal year 2018 performance and the momentum we have built from our investments in the business. Looking ahead

to fiscal year 2019, we intend to continue to accelerate on our momentum through transformation and invest in our strategic initiatives while executing on margin opportunities. We believe our core strategy to create long-term shareholder value by balancing top line revenue growth and strong margins to drive earnings per share growth is working.

2018 Incentive Compensation Performance Metrics

Our financial performance impacted the compensation of our executive officers in several ways, most notably our annual cash bonus plan and performance-based stock unit (“PSU”) program. The compensation committee’s determination of incentive compensation under our annual cash bonus plan for our executive officers, including our NEOs, was based on fiscal year 2018 revenue growth, new business bookings growth, adjusted earnings before interest and taxes (“EBIT”) growth and strategic objectives. Targets and results exclude the impact of certain items pursuant to predetermined categories of parameters established by the compensation committee at the time that targets were set.

Performance for all metrics, including the strategic objectives, are formulaically measured without the use of subjective judgment. Details with regard to the strategic

objectives are provided on page 42 and the financial goals and performance results are summarized below.

The incentive compensation under our PSU program was based on net income growth for fiscal years 2017 and 2018 and, for PSU awards granted in fiscal year 2016, earnings per share growth. Targets and results exclude the impact

of certain items pursuant to predetermined categories of parameters established by the compensation committee at the time the targets were set.

2018 Compensation Highlights

Consistent with our pay for performance philosophy, the compensation of our NEOs is structured with a significant portion of their total compensation at risk and paid based on the performance of the company and the applicable business unit. Our financial performance in fiscal year 2018 impacted the compensation for all of our executive officers,

not just our NEOs, in several ways, most notably through our annual cash bonus plan and PSU program. Please refer to the “Compensation Discussion and Analysis” section on page 30 of this proxy statement, and the tables and narratives that follow on page 50 of this proxy statement, for more detail concerning the compensation of our NEOs.

The mix of target total direct compensation (base salary, cash bonus, and long-term incentive awards) for fiscal year 2018 was designed to deliver the following approximate proportions of total compensation to Mr. Rodriguez, our

chief executive officer, and the other NEOs (on average) if company and individual target levels of performance are achieved:

Stockholder Engagement Process

We value stockholder engagement and feedback as we continue to deliver strong financial performance and sustained value creation for our investors. Our ongoing investor engagement program includes outreach focused on the company’s strategy, corporate governance and executive compensation programs. We contacted stockholders representing more than 60% of our shares outstanding, and during fiscal year 2018, we discussed our strategy, corporate governance and executive compensation programs with stockholders representing over 40% of our shares outstanding. In addition to management, many of these engagements included participation by certain members of our board of directors, including our chairman. Director participation continues to be part of our engagement in fiscal year 2019.

We look forward to maintaining this ongoing dialogue with our investors as well as incorporating feedback into our plans, as appropriate. These meetings, which are designed to keep our board of directors attuned to our stockholders’ views, provide useful context as we seek to ensure the interests of our stockholders continue to be addressed. What we learn from our stockholders through our ongoing discussions is regularly shared with our board of directors. For example, we received consistent feedback from our investors for more formal reporting on environmental, social and governance matters. As a result of this feedback and at the direction of our board, the company launched an enterprise-wide effort that culminated in the release of ADP’s first corporate social responsibility report in February 2018.

Important Dates for the 2019 Annual Meeting of Stockholders

Please refer to the “Stockholder Proposals” section on page 86 of this proxy statement for more information regarding the applicable requirements for submission of stockholder proposals. If a stockholder intends to submit any proposal (including pursuant to our proxy access by-law) for inclusion in the company’s proxy statement for the company’s 2019 Annual Meeting of Stockholders in accordance with Rule 14a-8 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the proposal must be received by the corporate secretary of the company no later than May 23, 2019.

Separate from the requirements of Rule 14a-8 relating to the inclusion of a stockholder proposal in the company’s proxy statement, the company’s amended and restated by-laws require that notice of a stockholder nomination for candidates for our board of directors (other than pursuant to our proxy access by-law) or any other business to be considered at the company’s 2019 Annual Meeting of Stockholders must be received by the company no earlier than July 9, 2019, and no later than August 8, 2019.

The board of directors of Automatic Data Processing, Inc. is soliciting your proxy to vote at the 2018 Annual Meeting of Stockholders to be held on November 6, 2018 at 10:00 a.m. Eastern Standard Time, and at any postponement(s) or adjournment(s) thereof. The meeting will be held at One ADP Boulevard, Roseland, New Jersey.

Under rules adopted by the SEC, we are furnishing proxy materials to our stockholders primarily via the Internet, instead of mailing printed copies of those materials to each stockholder. On September 20, 2018, we commenced the mailing to our stockholders of a Notice of Internet Availability of Proxy Materials containing instructions on how to access our proxy materials, including our proxy statement and our annual report on Form 10-K (which is not a part of the proxy soliciting material). This process is designed to expedite stockholders’ receipt of proxy materials, lower the cost of the Annual Meeting, and help conserve natural resources.

Our proxy materials were mailed to those stockholders who have previously asked to receive paper copies. If you would prefer to receive printed proxy materials, please follow the instructions included in the Notice of Internet Availability of Proxy Materials. If you have previously elected to receive our proxy materials electronically, you will continue to receive these materials via e-mail unless you elect otherwise.

The only outstanding class of securities entitled to vote at the meeting is our common stock, par value $0.10 per share. At the close of business on September 7, 2018, the record date for determining stockholders entitled to notice of, to attend, and to vote at the meeting, we had 437,439,841 issued and outstanding shares of common stock (excluding 201,272,601 treasury shares not entitled to vote). Each outstanding share of common stock is entitled to one vote with respect to each matter to be voted on at the meeting.

This proxy statement and our annual report on Form 10-K are also available on our corporate website at www.adp.com under “Financial Information” in the “Investor Relations” section.

Below are summaries of the principal occupations, business experience, background, and key skills and qualifications of the nominees. The key skills and qualifications are not intended to be an exhaustive list of each nominee’s skills

or contributions to the board, but rather the specific skills and qualifications that led to the conclusion that the person should serve as a director for the company.

It is expected that all nominees proposed by our board of directors will be able to serve on the board if elected. However, if before the election one or more nominees are unable to serve or for good cause will not serve (a situation that we do not anticipate), the proxy holders will vote the proxies for the remaining nominees and for substitute nominees chosen by the board of directors (unless the board reduces the number of directors to be elected). If

any substitute nominees are designated, we will file an amended proxy statement that, as applicable, identifies the substitute nominees, discloses that such nominees have consented to being named in the revised proxy statement and to serve if elected, and includes certain biographical and other information about such nominees required by the rules of the SEC.

The board of directors’ categorical standards of director independence are consistent with NASDAQ listing standards and are available in the company’s corporate governance principles on our corporate website at www.adp.com. To access these documents, click on “Investor Relations,” then “Corporate Governance,” and then “Governance Documents.” The board of directors has determined that Ms. Gooden, Ms. Wijnberg and Messrs. Bisson, Clark, Fast, Gregoire, Hubbard, Jones, Lynch, Powers and Ready meet these standards and are independent directors for purposes of the NASDAQ listing standards. All current members of the audit, compensation, nominating/corporate governance, and corporate development and technology advisory committees are independent.

In the ordinary course of business, the company has business relationships with certain companies in which ADP directors also serve as executive officers or on the board of directors, including for example, software services and human capital management services. Based on the standards described above, the board of directors has determined that none of these transactions or relationships, nor the associated amounts paid to the parties, was material or would impede the exercise of independent judgment.

It is our policy that our directors attend the Annual Meetings of Stockholders. All of our directors then in office attended our 2017 Annual Meeting of Stockholders. During fiscal year 2018, our board of directors held fourteen (14) meetings. All of our incumbent directors attended at least 75%, in the aggregate, of the meetings of the board of directors and the committees of which they were members during the periods that they served on our board of directors during fiscal year 2018.

Executive sessions of the non-management directors are held during each meeting of the committees and the board of directors. Mr. Jones, our independent non-executive chairman of the board, presided at each executive session of the board of directors.

Our corporate governance principles do not require the separation of the roles of chairman of the board and chief executive officer because the board believes that effective board leadership can depend on the skills and experience of, and personal interaction between, people in leadership roles. Our board of directors is currently led by Mr. Jones, our independent non-executive chairman of the board. Mr. Rodriguez, our chief executive officer, serves as a member of the board of directors. The board of directors

believes this leadership structure is in the best interests of the company’s stockholders at this time. Separating these positions allows our chief executive officer to focus on developing and implementing the company’s business plans and supervising the company’s day-to-day business operations, and allows our chairman of the board to lead the board of directors in its oversight, advisory, and risk management roles.

The board takes a thoughtful approach to its composition to ensure alignment with the company’s evolving corporate strategy. We believe our board composition strikes a balanced approach to director tenure and allows the board to benefit from a mix of newer directors who bring fresh

perspectives and seasoned directors who bring continuity and a deep understanding of our complex business. We refresh our board and assess our board succession plans regularly with this balance of tenure and experience in mind. We have added six new directors since 2014.

As of our 2018 Annual Meeting, the average age of our director nominees will be 60 years and the average tenure of our independent directors will be 6.5 years.

Our director succession planning is conducted in the context of a skillset review designed to focus on key areas of skills and experience deemed to be most helpful to driving board performance. Our nominating/corporate governance committee evaluates these desired attributes on an ongoing basis and adds new skills and qualifications as necessary in light of the company’s changing strategy and needs.

Individual director evaluations are also conducted by the nominating/ corporate governance committee on an annual basis, in close coordination with our chairman. The form of assessment used to facilitate this review is refreshed each year to ensure relevance and covers a broad

array of topics relevant to individual performance such as knowledge, expertise, commitment, preparation, integrity and judgment. This process facilitates director succession planning as it helps identify opportunities to enhance individual performance and any relevant feedback is communicated to the individual director.

In addition to individual evaluations, the nominating/corporate governance committee, working with our chairman, conducts a thorough evaluation at the board and committee levels to ensure the effectiveness of the directors and their ability to work as a team in the long-term interest of the company. This assessment is conducted through a questionnaire process, which is also refreshed each year, and designed to elicit feedback with respect to areas such as board/committee structure, governance, communication, culture, risk and strategy. Responses are shared and discussed with the nominating/corporate governance committee. The committee then shares the output of this process with the full board along with a series of recommendations that are subsequently implemented to improve board and committee performance, practices and procedures.

The company also has a director retirement policy in place to promote thoughtful board refreshment, as set forth in further detail under “Retirement Policy” on page 16 of this proxy statement.

Our nominating process ensures our board consists of a well-qualified and diverse group of leaders who bring an important mix of boardroom and operating experience. When the board of directors decides to recruit a new member, or when the board of directors considers any director candidates submitted for consideration by our stockholders, it seeks strong candidates who, ideally, meet all of its categorical standards of director independence, and who are, or were, preferably, senior executives of large companies who have backgrounds directly related to our technologies, markets and/or clients. Additionally, candidates should possess the following personal characteristics: (i) business community respect for his or her integrity, ethics, principles, insights and

analytical ability; and (ii) ability and initiative to frame insightful questions, speak out and challenge questionable assumptions and disagree without being disagreeable. The nominating/corporate governance committee will not consider candidates who lack the foregoing personal characteristics.

In addition, the nominating/corporate governance committee considers a wide range of other factors in determining the composition of our board of directors, including diversity of thought and background, as well as individual qualities such as professional experience, skills, education, and training. Our nominating/corporate governance committee also considers a range of types of diversity, including race, gender, ethnicity, age, culture

and geography. The nominating/corporate governance committee retains a third party search firm from time to time to identify and evaluate, as appropriate, potential nominees to the board. Nominations of candidates for our board of directors by our stockholders for consideration

at our 2019 Annual Meeting of Stockholders are subject to the deadlines and other requirements described under “Stockholder Proposals” on page 86 of this proxy statement.

Our director retirement policy provides that, subject to such exceptions on a case by case basis as the board of directors shall determine, no person will be nominated by the board of directors to serve as a director following the date he or she turns 72. Management directors who are no longer officers of the company are required to offer to resign from the board of directors.

After considering his many contributions, including the number of board objectives for which he provided great insight and value, as well as his knowledge and expertise, and relatively short tenure on the board, the board of directors waived the mandatory retirement age of 72 for Mr. Clark. The waiver is effective upon his 72^nd birthday in calendar year 2018 and allows Mr. Clark to stand for re-election until after his 75^th birthday.

Our board of directors provides oversight with respect to the company’s enterprise risk assessment and risk management activities, which are designed to identify, prioritize, assess, monitor and mitigate the various risks confronting the company, including risks that are related to the achievement of the company’s operational and financial strategy. As set forth in more detail below, the board of directors performs this oversight function periodically as part of its meetings and also through its audit, compensation and nominating/corporate governance committees, each of which examines various

components of risk as part of its assigned responsibilities. In addition, our corporate development and technology advisory committee acts in an advisory capacity to the board with respect to certain risks assigned to oversight of the full board. Our committees report back on risk oversight matters directly to the board of directors on a regular basis. Management is responsible for implementing and supervising day-to-day risk management processes and reporting to the board of directors and its committees as necessary.

Audit Committee

Our audit committee focuses on financial risks, including reviewing with management, the company’s internal auditors, and the company’s independent auditors the company’s major financial risk exposures, the adequacy and effectiveness of accounting and financial controls, and the steps management has taken to monitor and control financial risk exposures. In addition, our audit committee reviews risks related to compliance with applicable laws, regulations, and ethical standards, and also operational risks related to information security and system disruption. Our audit committee regularly receives, reviews and discusses with management presentations

and analyses on various risks confronting the company. In addition, our audit committee receives quarterly reports from our chief security officer, who is tasked with monitoring physical and cybersecurity risks, including operational risks related to information security and system disruption.

Nominating/Corporate Governance Committee

Our nominating/corporate governance committee oversees risks associated with board structure and other corporate governance policies and practices, including matters of corporate citizenship and the review and approval of any related-person transactions under our Related Persons Transaction Policy.

Our compensation committee considered the risks presented by the company’s compensation policies and practices at its meetings in August 2017 and 2018 and believes that our policies and practices of compensating employees do not encourage excessive or unnecessary risk-taking for the following reasons:

All interested parties who wish to communicate with the board of directors, the audit committee, or the non-management directors, individually or as a group, may do so by sending a detailed letter to P.O. Box 34, Roseland, New Jersey 07068, leaving a message for a return call at 973-974-5770 or sending an email to adp_audit_committee@adp.com. We will relay any such communication to the non-management director to which such communication is addressed, if applicable, or to the most appropriate committee chairperson, the chairman

of the board, or the full board of directors, unless, in any case, it is outside the scope of matters considered by the board of directors or duplicative of other communications previously forwarded to the board of directors.

Communications to the board of directors, the non-management directors, or to any individual director that relate to the company’s accounting, internal accounting controls, or auditing matters are referred to the chairperson of the audit committee.

We have a written “Related Persons Transaction Policy” pursuant to which any transaction between the company and a “related person” in which such related person has a direct or indirect material interest, and where the amount involved exceeds $120,000, must be submitted to our nominating/corporate governance committee for review, approval, or ratification.

A “related person” means a director, executive officer or beneficial holder of more than 5% of the company’s outstanding common stock, or any immediate family member of the foregoing, as well as any entity at which any such person is employed, is a partner or principal (or holds a similar position), or is a beneficial owner of a 10% or greater direct or indirect equity interest in that entity. Our directors and executive officers must inform our general counsel at the earliest practicable time of any

plan to engage in a potential related person transaction. This policy requires our nominating/corporate governance committee to be provided with full information concerning the proposed transaction, including the benefits to the company and the related person, any alternative means by which to obtain like benefits, and terms that would prevail in a similar transaction with an unaffiliated third party. In considering whether to approve any such transaction, the nominating/corporate governance committee will consider all relevant factors, including the nature of the interest of the related person in the transaction and whether the transaction may involve a conflict of interest.

Specific types of transactions are excluded from the policy, such as, for example, transactions in which the related person’s interest derives solely from his or her service as a director of another entity that is a party to the transaction.

Our Corporate Governance Principles and Related Persons Transaction Policy may be viewed online on the company’s website at www.adp.com. To access these documents, click on “Investor Relations,” then “Corporate Governance,” and then “Governance Documents.” Our Code of Business Conduct & Ethics and Code of Ethics for

Principal Executive Officer and Senior Financial Officers may be found at www.adp.com under “Investor Relations” in the “Corporate Governance” tab. In addition, these documents are available in print to any stockholder who requests them by writing to Investor Relations at the company’s headquarters.

Messrs. Clark, Fast, Hubbard and Lynch are the four independent directors who sit on the compensation committee. No compensation committee member has ever been an officer of the company. During fiscal year 2018 and as of the date of this proxy statement, no compensation committee member has been an employee of the company or eligible to participate in our employee compensation programs or plans, other than the company’s amended

and restated 2008 Omnibus Award Plan under which non-employee directors have received stock option grants and deferred stock units. None of the executive officers of the company have served on the compensation committee or on the board of directors of any entity that employed any of the compensation committee members or directors of the company.

As further set forth below, our nominating/corporate governance committee reviews and evaluates non-employee director compensation on an annual basis to ensure that our directors are compensated appropriately for their time commitment and responsibilities. The nominating/corporate governance committee makes

recommendations to the board of directors, as appropriate, based on its review, benchmark information from peer companies, and other relevant data. The elements of our non-employee director compensation program are as follows:

Annual Retainers

The annual retainer for non-employee directors is $290,000, $175,000 of which is paid in the form of DSUs and $115,000 of which may, at the election of each director, be paid in cash or in DSUs.

In addition, the chairman of our board of directors receives an incremental retainer of $200,000, $100,000 of which is paid in the form of DSUs and $100,000 of which may, at the election of the chairman, be paid in cash or in DSUs. This incremental retainer resulted in a total annual retainer of $490,000 for the chairman of our board of directors in fiscal year 2018.

The chair of the audit committee was paid an additional annual retainer of $20,000, and each chair of the compensation, nominating/corporate governance, and corporate development and technology advisory committees was paid an additional annual retainer of $15,000. The additional annual retainer may, at the election of each committee chair, be paid in cash or DSUs.

Meeting Fees

Meeting fees are not paid in respect of the first seven meetings of the board of directors or of any individual committee. Non-employee directors receive $2,000 for each board of directors meeting attended and $1,500 for each committee meeting attended beginning with the eighth meeting of the board of directors or any individual committee, as applicable. During fiscal year 2018, our board of directors held fourteen (14) meetings and non-employee directors received $2,000 for each board meeting attended beginning with the eighth meeting. Meeting fees may, at the election of each director, be paid in cash, deferred, or paid in DSUs. Under our amended and restated 2008 Omnibus Award Plan (“2008 Omnibus Award Plan”), a director may specify whether, upon separation from the board, he or she would like to receive any deferred cash amounts in a lump-sum payment or in a series of substantially equal annual payments over a period ranging from two to ten years. For fiscal year 2018, meeting fees were paid in cash to the non-employee directors.

Deferral Policy

Pursuant to our 2008 Omnibus Award Plan, each non-employee director is credited with an annual grant of DSUs on the date established by the board for the payment of the annual retainer equal in number to the quotient of $175,000, or $275,000 in the case of the chairman of the board of directors, divided by the closing price of a share of our common stock on the date this amount is credited. DSUs are fully vested when credited to a director’s account. When a dividend is paid on our common stock, each director’s account is credited with an amount equal to the cash dividend. When a director ceases to serve on our board, such director will receive a number of shares of common stock equal to the number of DSUs in such director’s account and a cash payment equal to the dividend payments accrued, plus interest on the dividend equivalents from the date such dividend equivalents were credited. The interest will be paid with respect to each twelve-month period beginning on November 1 of such period to the date of payment and will be equal to the rate for five-year U.S. Treasury Notes published in The Wall Street Journal® on the first business day of November of each such twelve-month period plus 0.50%. Non-employee directors do not have any voting rights with respect to their DSUs. Other than Ms. Gooden and Mr. Fast, all of our non-employee directors chose to receive the entire elective portion of their annual retainers in the form of DSUs during fiscal year 2018.

Role of the Nominating/Corporate Governance Committee

The nominating/corporate governance committee is responsible for reviewing, evaluating, and making recommendations to the board on an annual basis with respect to all aspects of non-employee director compensation. The full board then reviews these recommendations and makes a final determination on the compensation of our non-employee directors. During fiscal year 2018, the nominating/corporate governance committee engaged FW Cook, compensation consultant to the compensation committee, to review the design and competitiveness of our non-employee director compensation program.

Changes to Director Compensation in Fiscal Year 2019

In connection with the annual review discussed above, the board of directors approved an increase to the non-elective portion of the annual retainer to $185,000 (from $175,000), to be effective at the time of the 2018 Annual Meeting of Stockholders, which will be paid in the form of DSUs. There were no other changes made to the non-employee director compensation program for fiscal year 2019.

Stock Options

Non-employee directors no longer receive annual stock option grants. Prior to our 2010 Annual Meeting of Stockholders, upon initial election to the board of directors, a non-employee director received a grant of options to purchase 5,000 shares of common stock if such director attended a regularly scheduled board of directors meeting prior to the next Annual Meeting of Stockholders. Thereafter, a non-employee director received an annual grant of options to purchase 5,000 shares of common stock. All such options were granted under the 2008 Omnibus Award Plan, have a term of ten years, and were granted at the fair market value of the common stock as determined by the closing price of our common stock on the NASDAQ Global Select Market on the date of the grant. In addition, non-employee directors who have been non-employee directors for at least ten years will have all of their options vested upon retirement from the board of directors and will have 36 months to exercise their options. Notwithstanding the foregoing, all options will expire no more than ten years from their date of grant.

Stock Ownership Guidelines

Our stock ownership guidelines are intended to promote ownership in the company’s stock by our non-employee directors and to align their financial interests more closely with those of other stockholders of the company. Each non-employee director has a minimum stockholding requirement of our common stock equal to five times his or her annual cash retainer.

The following table contains information regarding the beneficial ownership of the company’s common stock by (i) each director and nominee for director of the company, (ii) each of our named executive officers (“NEOs”) included in the Summary Compensation Table, (iii) all company directors and executive officers as a group (including the NEOs) and (iv) all stockholders that are known to the company to be the beneficial owners of more than 5%

of the outstanding shares of the company’s common stock. Unless otherwise noted in the footnotes following the table, each person listed below has sole voting and investment power over the shares of common stock reflected in the table. Unless otherwise noted in the footnotes following the table, the information in the table is as of August 30, 2018 and the address of each person named is P.O. Box 34, Roseland, New Jersey, 07068.

We are asking stockholders to approve the following advisory resolution at the Annual Meeting:

RESOLVED, that the stockholders approve, on an advisory basis, the compensation of the company’s named executive officers as disclosed in the Compensation Discussion and Analysis, the accompanying compensation tables and the related narrative disclosure in the company’s proxy statement for the 2018 Annual Meeting of Stockholders.

The board of directors recommends a vote FOR this resolution because it believes that the policies and practices described in the Compensation Discussion and Analysis are effective in achieving the company’s goals of linking

pay to executive performance and levels of responsibility, encouraging our executive officers to remain focused on both short-term and long-term financial and strategic goals of the company and linking executive performance to the creation of stockholder value.

We urge stockholders to read the Compensation Discussion and Analysis section appearing on pages 30 through 49 of this proxy statement, as well as the “Summary Compensation Table for Fiscal Year 2018” and related compensation tables and narrative appearing on pages 50 through 72 of this proxy statement, which provide detailed information on the company’s compensation policies and practices and the compensation of our named executive officers.

The affirmative vote of the holders of a majority of the shares represented in person or by proxy and entitled to vote thereon is required to approve the advisory resolution on executive compensation. Properly executed proxies will be voted as marked. Executed but unmarked proxies will be voted in favor of the advisory resolution on executive compensation. Because the vote on this proposal is advisory in nature, it will not affect any compensation already paid or awarded to any named executive officer and will not be binding on or overrule any decisions by the compensation committee or the board of directors.

Because we value our stockholders’ views, however, the compensation committee and the board of directors will consider carefully the results of this advisory vote when formulating future executive compensation policy.

THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR THE APPROVAL OF THE ADVISORY RESOLUTION ON EXECUTIVE COMPENSATION.

Mr. Flynn’s last day of employment with the company was June 30, 2018.

The CD&A also provides an overview of our executive compensation philosophy and explains how the compensation committee of our board of directors arrives at specific compensation decisions involving the NEOs. In addition, the CD&A explains how our executive compensation programs are designed and operate with respect to our NEOs by discussing the following fundamental aspects of our compensation programs:

Strong Stockholder Support for our Compensation Programs

The compensation committee continuously evaluates the degree to which our compensation programs link pay to performance, and takes steps to ensure that the program encourages our executive officers to remain focused on both the short-term and long-term financial and strategic goals of the company. Each year the compensation committee sets rigorous and challenging performance measures aligned to these company goals. We continue to believe that growth in revenue, adjusted EBIT (as defined on page 32), new business bookings⁽¹⁾ and net income are the most important measures of the successful execution of our objectives and the delivery of sustainable long-term stockholder value.

At our 2017 Annual Meeting of Stockholders, our stockholders approved the compensation of our fiscal year 2017 NEOs by a vote of approximately 93% in favor. Given this strong support and the company’s continued solid performance, the compensation committee retained the basic foundation of our overall compensation program during fiscal year 2018, but made certain changes as described in this CD&A to ensure that the program continued to support our key financial and strategic objectives.

Fiscal year 2018 reflected growing momentum from our multi-year investments in distribution, product, and operational initiatives. We accelerated the pace of our change and transformation through the launch of our next generation platforms, the completion of our mid-market migrations, our acquisitions of Global Cash Card and WorkMarket, the continued execution of our service alignment initiative, and the launch of our voluntary early retirement program.

ADP’s client-centric focus and drive to meet the evolving needs of the global HCM market through leading-edge product and unparalleled service delivered robust financial performance that contributed to an improvement in client retention and a sustained acceleration in our new business bookings. Other key business results in fiscal year 2018 continued to reflect a strong enterprise with solid revenue growth, improved margins, consistent, healthy cash flows and low capital expenditure requirements.

We continue to see ample opportunity to add value in new and innovative ways given our strong fiscal year 2018 performance and the momentum we have built from our investments in the business. Looking ahead to fiscal year 2019, we intend to continue to accelerate on our momentum through transformation and invest

in our strategic initiatives while executing on margin opportunities. We believe our core strategy to create long-term shareholder value by balancing top line revenue growth and strong margins to drive earnings per share growth is working.

2018 Incentive Compensation Performance Metrics

Our financial performance impacted the compensation of our executive officers in several ways, most notably our annual cash bonus plan and performance-based stock unit (“PSU”) program. The compensation committee’s determination of incentive compensation under our annual cash bonus plan for our executive officers, including our NEOs, was based on fiscal year 2018 revenue growth, new business bookings growth, adjusted earnings before interest and taxes (“EBIT”) growth and strategic objectives. Targets and results exclude the impact of certain items pursuant to predetermined categories of parameters established by the compensation committee at the time that targets were set.

Performance for all metrics, including the strategic objectives, are formulaically measured without the use of subjective judgment. Details with regard to the strategic

objectives are provided on page 42 and the financial goals and performance results are summarized below.

The incentive compensation under our PSU program was based on net income growth for fiscal years 2017 and 2018 and, for PSU awards granted in fiscal year 2016, earnings per share growth. Targets and results exclude the impact

of certain items pursuant to predetermined categories of parameters established by the compensation committee at the time the targets were set.

The compensation committee of our board of directors determines the compensation of our chief executive officer and all other executive officers. When making decisions related to officers, including the NEOs (other

than our chief executive officer), the committee considers recommendations from the chief executive officer. The following table summarizes the major elements of our fiscal year 2018 executive officer compensation programs.

For fiscal year 2018, our NEOs received cash bonuses that averaged approximately 132.0% of target.

A payout percentage of 142% was achieved under our PSU program as a result of our fiscal year 2018 net income growth. This net income payout percentage applies to year 1 of the fiscal year 2018 award and to year 2 of the fiscal year 2017 award. These awards will be earned and issued following the end of the corresponding three-year performance period ending in fiscal years 2020 and 2019, respectively.

In addition, a payout percentage of 142% was achieved under our PSU program as a result of our fiscal year 2018 EPS growth and applies only to year 3 of the fiscal year 2016 award. The end of fiscal year 2018 marked the end of the three-year performance period for PSU awards granted in fiscal year 2016 as well as the use of EPS growth as a PSU program measure. Based on the average of the three fiscal years, these awards earned a payout percentage of 119%. As further described on page 44 of this proxy statement under “PSU Awards,” the payout percentages achieved for each of the individual three fiscal years in the applicable performance period are averaged to obtain the award level earned and issued as a percentage of target.