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GCN Home > August 9, 1999 issue

Beat The Clock

Beat the Clock

Dates to watch. The biggest U.S. payroll processing company boasts that 35 million wage earners will get paid as usual come Jan. 3, as well as on Feb. 29 and other troublesome dates next year. Problems may arise from states’ unreadiness to receive the workers’ tax information files, however.

Automatic Data Processing Inc. of Roseland, N.J., has “a lot of confidence in the direct-deposit system working,” planning director John Gregory said.

Likewise, the Agriculture Department’s National Finance Center has promised that federal employees whose pay it handles will receive their due no matter what [GCN, Aug. 31, 1998, Page 16].

ADP’s seven-week readiness test with 25 different banks was not as well-subscribed as the Federal Financial Institutions Examination Council would have liked. FFIEC, whose members include the Federal Reserve, Office of Thrift Supervision and Comptroller of the Currency, had requested that all the 23,000 U.S. financial institutions test their system interfaces with third-party providers and service bureaus.

Checking the checks. ADP developed its own readiness test and validated test scripts with the 25 banking institutions. “When you’re responsible for paying 35 million people and depositing $300 billion in federal and state taxes, you do not take the year 2000 [problem] lightly,” Gregory said. ADP runs payroll for 9,000 of the 23,000 U.S. financial institutions.

On a scale ranging from negligible to severe, payroll applications are moderately date-sensitive, said James Kinder, ADP vice president of information technology for year 2000. Hiring dates, birth dates, pre-note dates for direct deposit, pay dates and period-ending dates must all be examined. So must date-dependent calculations for benefit accruals.

The giant payroll vendor was ready for year 2000 payroll processing by April 1998, Gregory said, after sifting through 120 million lines of code in 135,000 programs and dealing with 640 vendors of 1,900 third-party software products. ADP officials expect their readiness spending to top out at $120 million.

The aged-data test. For the first test of its kind, ADP devised a fictitious payroll of fictitious names and Social Security numbers touching every state and more than 60 federal, state and city tax jurisdictions. The payroll test results, complete with test scripts and requirements documents, are available on CD-ROM and can be ordered via the Web, at www.adp.com.

For the next five months, ADP will busy itself with final due-diligence efforts and contingency planning. A year 2000 command center will open in October. After that, Gregory said, it’s wait and see.

—Florence Olsen Internet: editor@gcn.com

Many of the other 14,000 receive ADP direct-deposit transmissions and check reconciliation files. As for the states that are not in good shape for payroll taxes, Kinder said, “we’re waiting for them to get back to us as to when they are ready to receive our file.”



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