ADP Revenue Share: How It Works and Who Qualifies
Understand the structure, eligibility, and process behind ADP's revenue share program, including key requirements and how payments are managed.
ADP, a major provider of payroll and human capital management solutions, offers a revenue share program that can provide an additional income stream for certain partners. This arrangement allows eligible participants to earn a portion of the revenue generated through client referrals or other qualifying activities tied to ADP’s services.
Understanding how this program works is important for those considering participation, as it involves specific terms, calculations, and timelines. Knowing what to expect from ADP’s revenue share model can help potential partners make informed decisions.
Who Qualifies for ADP Revenue Share
Participation in ADP’s revenue share program is generally available to specific types of businesses and professionals who establish a formal partnership. Primarily, this includes accounting professionals, such as Certified Public Accountants (CPAs), bookkeepers, and accounting firms, often through programs like the “Accountant Revenue Share Incentive Program.” These professionals frequently manage client payroll and HR, making them suitable conduits for referrals.
Other entities can also qualify. Insurance brokers, particularly those involved in benefits administration or workers’ compensation, may be eligible, sometimes through programs linked to specific ADP offerings like its Professional Employer Organization (PEO) product. Eligibility often requires brokers to be contracted with ADP and meet referral criteria, such as minimum client employee counts and proper documentation within ADP’s systems.
Technology companies and software developers offering solutions complementary to ADP’s Human Capital Management (HCM) services can qualify via the ADP Marketplace Partner Program. Eligibility considers factors like having a significant number of shared clients, offering distinct HCM or business solutions, possessing a Software-as-a-Service (SaaS) platform capable of API integration with ADP, and having digital purchasing capabilities. These partners undergo evaluation for strategic alignment and must meet ADP’s security and integration standards.1ADP Marketplace. Becoming an ADP Marketplace Partner Overview
Existing ADP clients might participate in certain referral reward programs, though these may offer points or credits instead of direct revenue share and have specific rules regarding the referred company’s size or status (e.g., not already an ADP client). Some initiatives, like the invitation-only ADP Ambassador Program, target select clients and “Trusted Resources” to make referrals and serve as references.2ADP Ambassador. ADP Ambassador Program Terms and Conditions Generally, broker referral programs are available only to U.S. companies and sole proprietors, not individuals.3ADP Referral Rewards. ADP Broker Referral Program Terms and Conditions
How the Revenue Share Is Calculated
The calculation of revenue share payments varies depending on the specific program and partnership terms. Typically, the payment is a percentage of the revenue ADP generates from clients referred by the partner. For programs aimed at accountants referring small businesses (e.g., 1-49 employees), this might be based on the client’s “annualized first-year payroll processing revenues” or “Net Processing Revenues,” usually encompassing recurring fees for initial payroll services.
Reported structures include flat percentages, such as 10% for certain affiliate programs, or tiered systems for accountant referrals where the percentage can increase (e.g., from 25% up to potentially 75%) based on the number of clients onboarded within a contract year.4ADP Referral Rewards. ADP Partner Program Overview
The “revenue” base for these calculations often centers on recurring fees for core services like payroll processing. Depending on the agreement, it might extend to related services like HR support or benefits administration integrated with ADP. Certain pass-through costs, however, such as those for PEO zero-margin benefits, might be excluded.
The structure isn’t limited to percentages of first-year revenue. Some programs mention potential “ongoing residual payments” based on the referred client’s continued service, offering income beyond the initial year. Others, especially for referrals involving larger clients or specific services like ADP’s PEO or Administrative Services Organization (ASO) offerings, might use fixed-dollar amount rewards per referral instead of a percentage. The precise method is defined in the partnership agreement. ADP performs these calculations, and partners usually have access to dashboards for tracking referrals and earnings.
Relevant Agreements and Paperwork
Engaging in an ADP revenue share program requires formalizing the relationship through specific agreements. These documents outline the obligations and operational parameters for both parties. For example, the ADP Broker Referral Program requires agreeing to online Terms and Conditions during enrollment. Technology partners joining the ADP Marketplace review and sign legal contracts, potentially including a Developer Participation Agreement for data access or app distribution.
These agreements detail the partnership’s nature, covering referral conditions, agreement duration, and potential exclusivity clauses. Confidentiality and data privacy are key components, specifying how sensitive client information must be handled according to applicable laws. Partners may also need to adhere to specific marketing guidelines to represent ADP’s services accurately.
A standard requirement for U.S.-based partners operating as businesses or independent contractors is providing tax information. This ensures ADP can issue necessary year-end tax forms documenting the income earned. For nonemployee compensation paid to partners like accountants or brokers, ADP typically issues Form 1099-NEC if payments reach $600 or more in a calendar year. Partners receive this form, usually by January 31st of the following year, to report the income on their tax returns. U.S.-based prospective partners generally must complete and submit IRS Form W-9, Request for Taxpayer Identification Number and Certification.5Pacific States Marine Fisheries Commission Relief Program. Form W-9 Request for Taxpayer Identification Number and Certification
Timing of Disbursements
The timing of revenue share payments depends on the specific program and agreement terms. Several programs, including certain referral and affiliate initiatives, operate on a quarterly payment cycle. Payments are often processed within 45 days after the end of the ADP fiscal quarter in which the referred client begins processing services.6ADP Referral Rewards. ADP Partner Program Terms and Conditions This creates a lag between a referral becoming an active client and the partner receiving payment.
This quarterly schedule allows time for revenue verification. For instance, if a client starts services in January (within ADP’s third fiscal quarter ending in March), the associated payment would likely be disbursed by mid-May. Specific payment dates mentioned in some program documents align with this pattern (e.g., May 15th, August 15th, November 15th, February 15th).
The trigger for payment eligibility often relates to the referred client reaching a milestone, such as completing their first payroll run or using services for a minimum period (e.g., 30 days). This confirms the referral is generating revenue. For programs based on annualized first-year revenues, payments might be disbursed quarterly throughout that year or as a lump sum afterward. Programs with fixed-dollar rewards might have different payout structures, potentially involving installments contingent on the client remaining active.
Partners can typically track referral status and anticipated payments through dedicated ADP online portals. The actual receipt of funds depends on the payment method (e.g., direct deposit, check), but disbursement follows ADP’s established timeline.
Steps to Begin Participation
Starting participation involves a specific enrollment process tailored to the partnership type. Accounting professionals interested in the Accountant Revenue Share Incentive Program usually begin by contacting an ADP representative or exploring partner resources online. It may be strategic to delay formal enrollment until a potential referral is identified, as the contract period influencing tiered compensation might start upon approval.
Technology companies applying for the ADP Marketplace Partner Program typically submit a detailed online application covering their company, products, client base, sales metrics, and target audience. ADP evaluates this for strategic fit, looking for criteria like SaaS platforms with API integration and digital purchasing capabilities. An ADP representative usually follows up to discuss the application and review process, which includes assessments by sales, security, and legal teams. This involves a security review and potentially signing agreements like a Developer Participation Agreement.
A fundamental step early in any enrollment process is providing necessary identification and tax information. This form collects the partner’s legal name, address, business classification, and Taxpayer Identification Number (TIN), which must match official records. Providing a correct W-9 is essential for setting up payments and ensuring tax compliance.
Upon successful enrollment, completion of paperwork, and acceptance of terms, ADP confirms the partnership and typically assigns a unique identifier, such as a Partner Identification Code (PIC) for referral-based programs. This code is used for tracking referrals attributed to the partner, ensuring accurate calculation and crediting of earnings. Assignment of the PIC often marks the formal activation of the partnership, allowing the partner to begin qualifying activities. Access to partner portals for managing referrals and monitoring participation is usually granted around this time.