ADP introduces sophisticated garnishment service; saves employers time and money by relieving them of the manual, complex and burdensome tasks of processing garnishments.

ROSELAND, N.J.--(BUSINESS WIRE)--June 5, 1995--Automatic Data Processing, Inc. (ADP)--the country's largest provider of payroll-related services--today announced the introduction of its garnishment service, Child Support, Tax Levies and Garnishments (CSTLG).

This new service automatically calculates garnishment deduction amounts according to the appropriate regulations, reports on these amounts and actually helps employers make payments. This affordable service is the only garnishment service available today that is fully integrated with a payroll system.

"Child Support, Tax Levies and Garnishments answers a very real need of employers today," said Frank Sobyak, ADP's director of Government Compliance Services. "Companies are overwhelmed by the complexity of the calculations required by federal and state mandates, especially those that operate in multiple states. At the same time, employers are concerned about the risks of incurring fines and penalties for noncompliance. The result, in many cases, has been a need to hire additional staff just to manage this aspect of the payroll."

"ADP's new feature," Sobyak said, "eliminates the burden of performing these difficult calculations, as well as the responsibility of keeping up with changing federal and state legislation. And it's the first service of its kind to totally integrate the garnishment function directly into a company's payroll processing service, so that calculations and deductions are made automatically."

A Benefit for Society, A Burden for Employers

The Family Support Act was passed in 1988 to help remedy the fact that only $14 billion of a potential $48 billion in annual child support payments is ever collected. However, this Act made it mandatory for employers to calculate and deduct garnishment amounts from employees' earnings...turning a benefit for society into a burden for employers. Under the law, employers who fail to make prompt payments are subject to penalties and late fees. Improper withholding can also result in an employer making an employee's garnishment payments from company funds.

The issue is only growing. By 1996, the government estimates that 10% of the population will have a child support order. When adding all other types of garnishments, some estimates show that 16% of the population will soon have some type of lien against their earnings.

Automatic Calculation of up to Six Garnishments Simultaneously

The CSTLG feature automatically calculates disposable income (the basis for all deductions) according to applicable federal or state law, prioritizes multiple garnishments according to regulations, checks against each state's maximum allowable deduction percentages and determines the appropriate amount to deduct in the event that earnings do not satisfy all garnishments. What's more, CSTLG can do all this simultaneously for up to six garnishments for each employee.

The amount of any garnishment is then deducted from the employee's wages, and reported to the employer on two special reports. The service also guarantees that all garnishments will be calculated properly based on the client's input.

Benefits for Employers and State Agencies

ADP's new CSTLG feature saves employers time by eliminating the manual steps and complexity of garnishment calculations. Employers will also be able to reduce costs and eliminate errors, as this feature automates tasks and makes processing garnishments more efficient. Even garnishment payment and record keeping will be made easier, with reports that detail garnishment deductions.

There are benefits for state agencies as well. Automated programs such as CSTLG ensure accurate garnishment calculations and proper payment amounts. They speed the payment process and help ensure that necessary information is submitted with garnishment payments.

In all, ADP's sophisticated new CSTLG feature will benefit both employers and state agencies by making the entire garnishment process more efficient.

Automatic Data Processing,Inc.

ADP provides computerized transaction processing, data communications, software and information services to more than 300,000 clients in virtually every business and industry. The company, founded in 1949, had more than $2.4 billion in annual revenue in fiscal 1994. In addition to a complete line of employer services, ADP provides market data and back-office services to the brokerage and financial communities, industry-specific services to auto and truck dealerships, and automated car collision and repair estimating.

CONTACT: Automatic Data Processing, Inc., Roseland

Frank R. Sobyak, 201/994-5071