8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

______________

FORM 8-K
CURRENT REPORT

Pursuant to Section13 or 15(d) of The
Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 1, 2006

AUTOMATIC DATA PROCESSING, INC.

(Exact name of registrant as specified in its charter)

Delaware	1-5397	22-1467904
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

One ADP Boulevard, Roseland, New Jersey	07068
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (973) 974-5000

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o        Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o        Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o        Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act

(17 CFR 240.14d-2(b))

o        Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act

(17 CFR 240.13e-4(c))

Item 1.01. Entry into a Material Definitive Agreement

On August 1, 2006 Automatic Data Processing, Inc., a Delaware corporation (the “Company” or “ADP”) entered into a letter agreement with Mr. Christopher R. Reidy, who will become a Corporate Vice President and Chief Financial Officer of ADP, which sets forth certain understandings and arrangements with respect to the employment relationship of Mr. Reidy with ADP. Since 2000, Mr. Reidy has held various positions with the AT&T Corporation, including Vice President, Business Planning, Vice President and Chief Financial Officer, Consumer Services, Vice President and Chief Financial Officer, Business Services, and most recently, Vice President, Controller and Chief Accounting Officer. The AT&T Corporation is not an affiliate of the Company. Mr. Reidy is expected to begin his employment with ADP no later than October 2, 2006.

Under the terms of his letter agreement with the Company, Mr. Reidy’s initial annual base salary shall be $500,000 and his annual target bonus shall be 80% of his base salary. The actual bonus paid to Mr. Reidy will be based on his and the Company’s accomplishments in relation to pre-established performance goals. The letter agreement provides that Mr. Reidy is to be granted a time-based restricted stock award of 26,000 shares; restrictions on 13,000 of such shares will lapse in each of fiscal year 2007 and fiscal year 2008. In addition, Mr. Reidy will be granted 13,000 shares of performance-based restricted stock for the Company’s 2007 fiscal year, which amount is subject to adjustment based on the achievement of pre-established performance criteria. The agreement further provides that Mr. Reidy is to receive an initial stock option grant of 75,000 shares on October 2, 2006, which options will have a per-share exercise price equal to the value of the Company’s common stock on the date of grant; normal additional grants to Mr. Reidy will be 20,000 options per year, provided that the first normal additional grant will be in January 2008. Under ADP’s 2-year accelerated revenue growth program (the “ARP”), the first program of which will, pending approval by the Compensation Committee of the Board of Directors, commence July 1, 2006 and will end June 30, 2008, the “target number of shares” of ADP restricted stock that Mr. Reidy may earn shall be based on 60% of Mr. Reidy’s base salary (all as determined by the terms and conditions of the applicable ARP).

Mr. Reidy is entitled to participate in the Company’s Change in Control Severance Plan for Corporate Officers and to participate in the Company’s car program for executives, in both cases on the same terms as other Company executives. Mr. Reidy is also entitled to participate in all of the Company’s then-current pension, 401(k), medical and health, life, accident, disability and other insurance programs, stock purchase and other plans and arrangements that are generally available to other Company executives.

In the event that Mr. Reidy is non-voluntarily terminated from ADP within the first three years of his employment, he will receive two years of base salary, bonus and restricted stock. After the third year of his employment, Mr. Reidy’s separation pay will be the equivalent of one year of base salary, bonus and restricted stock.

A copy of this letter agreement is attached as Exhibit 10.22 to this Form 8-K and is incorporated herein by reference. A copy of ADP’s press release announcing Mr. Reidy’s

employment with ADP is attached hereto as Exhibit 99.1 and is hereby incorporated by reference.

Item 5.02Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers

(c)On August 1, 2006, the Company’s Board of Directors appointed Mr. Dan Sheldon, 50, the Company’s Controller, as the Company’s Principal Accounting Officer and actingPrincipal Financial Officer. Mr. Sheldon joined ADP in 1984. Prior to his promotion to Principal Accounting Officer, he served as Vice President, Corporate Controller from 2003 to 2006, as Chief Financial Officer of the Company’s Brokerage Services business from 2001 to 2003 and Chief Financial Officer of the Company’s Dealer Services business from 1996 to 2001. Mr. Sheldon shall serve as acting Principal Financial Officer until Mr. Reidy joins the Company, at which time Mr. Reidy shall become the Company’s Principal Financial Officer.

Item 9.01 Financial Statements and Exhibits

(c) Exhibits

The following exhibits are filed as part of this Report on Form 8-K:

Exhibit Number	Description
10.22	Letter Agreement, dated as of August 1, 2006 between Automatic Data Processing, Inc. and Christopher R. Reidy (Management Contract)
99.1	Press Release, dated August 2, 2006, issued by Automatic Data Processing, Inc.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: August 2, 2006

AUTOMATIC DATA PROCESSING, INC.

By: /s/          James B. Benson_______________

Name:	James B. Benson
Title:	Vice President

Exhibit Index

Exhibit Number	Description
10.22	Letter Agreement, dated as of August 1, 2006 between Automatic Data Processing, Inc. and Christopher R. Reidy (Management Contract)
99.1	Press Release, dated August 2, 2006, issued by Automatic Data Processing, Inc.

EX-99.1

FOR IMMEDIATE RELEASE

ADP APPOINTS CHRISTOPHER R. REIDY CHIEF FINANCIAL OFFICER AND DAN SHELDON PRINCIPAL ACCOUNTING OFFICER AND INTERIM PRINCIPAL FINANCIAL OFFICER

ROSELAND, NJ, August 2, 2006 – The board of directors of Automatic Data Processing, Inc. (NYSE:ADP) has appointed Christopher R. Reidy to the position of chief financial officer, Gary C. Butler, president and chief operating officer and CEO-elect, announced today. Mr. Reidy will assume his role no later than October 2, 2006.

Mr. Reidy, who is 49 years old, has over 25 years of varied financial experience, most recently as the controller and chief accounting officer of AT&T Corporation. He received a B.S in accounting from St. Francis College and an M.B.A. from Harvard Business School.

Commenting on the appointment, Mr. Butler stated, “Chris has had an extraordinary career. A CPA with 11 years in public accounting, Chris started his career at Price Waterhouse and later became a partner at Deloitte & Touche. He has been the chief financial officer of AT&T’s two largest operating groups, Business Services and Consumer Services. Chris has extensive experience across the accounting and controls, financial planning and analysis, and financial and regulatory reporting functions. He has also been chief financial officer of NBA Properties, a global enterprise where he gained significant management and operating experience as well as exposure to new high growth ventures. Chris is also familiar with many of the global outsourcing and off-shoring initiatives that impact ADP, given AT&T’s own initiatives.”

Mr. Butler also announced that ADP’s board of directors had appointed Dan Sheldon, ADP’s controller since 2003, to the additional positions of principal accounting officer and, until Mr. Reidy assumes his role, interim principal financial officer.

ADP, with nearly $9 billion in revenues and more than 570,000 clients worldwide, is one of the largest providers of a broad range of premier, mission-critical, cost-effective processing and information-based business solutions.

Source: Automatic Data Processing, Inc.

ADP Investor Relations, 973.974.5858

#08#02#06

EX-10

August 1, 2006

Chris Reidy

Dear Chris:

I have outlined below the terms of our agreement with respect to your taking the position of Vice President/Chief Financial Officer of ADP. We anticipate your start date will be not later than Monday, October 2, 2006.

Base Salary: $500,000/paid monthly

Target Bonus @ 80%: $400,000

Time Based Restricted	26,000 shares
Stock:	(vesting 13,000 shares in FY ‘07 and 13,000 shares in FY ‘08)

2-Year Performance

Based Restricted Stock: 13,000 shares @ Target. First expected payout on these shares in 8/08, with 6 month vesting schedule. This is a 2-year rolling/renewal program based on ADP 2-year EPS CAGR.

Initial Stock Option Grant: 75,000 options grant with six year ratable vesting – zero in year one. Grant to be made on October 2, 2006.

Follow-on Stock Option

Grants: 20,000/year in January of each year. The first of these grants would be in January 2008.

ARP @ Target (FY’07-FY’08): 60% of Base Salary ($300,000)

Separation Pay: In the event you are non-voluntarily terminated from ADP within the first three years of your employment, you will receive two years of base salary, bonus and restricted stock. After your third year of employment, your separation pay will be the equivalent of one year of base salary, bonus and restricted stock.

Change of Control: The same as all other Officers

ADP SORP: Participation in SORP Program

- - 2 -

Other Corporate

Officer Programs: Participation in all other Corporate Officer programs (e.g., executive auto, matching gift program ($20K/year), executive physicals, executive retiree medical, deferred compensation)

If you are in agreement with the terms stipulated above, please sign a copy of this document and

return an original to me in the enclosed envelope, as well as fax to me at 973-974-3450. All of us who have met you look forward to working with you.

Sincerely yours,

/s/      Gary Butler
	Gary Butler

Agreed to:

/s/      Chris Reidy                            

Chris Reidy