Error by payroll provider ADP hits about 55,000 EY staff in US

Around 55,000 staff at EY’s US operations woke on Tuesday to find the wages they were paid on Friday had disappeared from their bank accounts after an error by the accounting firm’s payroll provider ADP.

The embarrassing mistake came as US workers grapple with a surge in living costs. US inflation hit 9.1 per cent last month, recording its biggest jump since November 1981.

The rare error also highlights the reliance of large companies on technology and the impact on customers and employees when systems fail.

It comes as EY considers a historic split of its audit and advisory divisions that would enable it to win more tech consulting work by avoiding conflicts of interest between the two business lines.

EY said ADP had “erroneously reversed EY’s July 15 payroll impacting our US employees”. The firm added that it was working urgently with ADP to fix the error, which had affected all of its roughly 55,000 US employees.

Staff who had already transferred the money out of their accounts or used it to pay bills risked being left in overdraft as a result of the mistake by ADP, which is one of the world’s biggest online payroll and HR software companies with a market valuation of about $90bn.

“Late fees, penalties or other charges [staff] may have incurred as a result of this error will be covered,” EY said.

ADP said in a statement: “We can confirm that we experienced an error that caused a payment reversal for a group of US employees of one of our clients. We understand the urgency of this issue and our team is working swiftly to resolve this to ensure employees receive their pay as quickly as possible.”

EY staff took to online forums and message boards to vent their frustration on Tuesday.

“Woke up with a bank alert about an overdraft fee, great way to start my day,” said one person on Reddit. Other users also said they were in overdraft as a result of the mistake, which one said they noticed at 5.30am.

“I’ve been here 25 years and this is the first time [this has happened],” said an EY employee on Fishbowl, a mobile social media app for professionals.

The error came in the first month of Julie Boland’s tenure as chair and managing partner of EY US, which had revenues of $16bn in the 12 months to June 2021. Boland took over from Kelly Grier, who insiders said had decided not to run for re-election after a power struggle with EY’s global boss Carmine Di Sibio.