WHEN

Thursday, October 10, 2024

9:30 a.m. Eastern Time

WHERE

Online only at

www.virtualshareholdermeeting.com/PAYX2024

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE 2024 ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON OCTOBER 10, 2024.

On or about August 30, 2024, we will mail to all stockholders a Notice of Internet Availability of Proxy Materials, which contains instructions for accessing our proxy materials on the Internet and voting by telephone or on the Internet. The Notice of Internet Availability of Proxy Materials also contains instructions for requesting a printed set of proxy materials. Paychex, Inc.’s Proxy Statement and Annual Report for the year ended May 31, 2024 are available at www.proxyvote.com and https://investor.paychex.com.

Our principal executive offices are located at 911 Panorama Trail South, Rochester, NY 14625-2396.

MATTERS TO BE VOTED ON:

The principal business of the 2024 Annual Meeting of Stockholders (the “Annual Meeting”) will be:

1.Toelect eleven nominees to the Board of Directors for a one-year term;

2.Tohold an advisory vote to approve named executive officer compensation;

3.Toratify the selection of PricewaterhouseCoopers LLP to serve as our independent registered public accounting firm; and,

4.Totransact such other business as may properly come before the meeting or any adjournment thereof.

WHO MAY VOTE:

Stockholders of record at the close of business on August 12, 2024 are entitled to notice of and to vote at the Annual Meeting and at any adjournments or postponements thereof.

HOW TO PARTICIPATE:

Our Annual Meeting will be broadcast as a live webcast accessible at: www.virtualshareholdermeeting.com/PAYX2024.

For more information about the virtual meeting format, including detailed instruction on how to vote, please see the “Frequently Asked Questions” section of the proxy statement.

By order of the Board of Directors

Prabha Sipi Bhandari

Chief Legal Officer, Chief Ethics Officer, and Secretary

August 30, 2024

VOTE BY

INTERNET BEFORE OR

DURING THE MEETING

Visit the website listed

on your Notice of

Internet Availability of

Proxy Materials.

VOTE BY

TELEPHONE

Call 1-800-690-6903

to vote by phone.

VOTE BY MAIL

Sign, date, and return

your proxy card in the

enclosed envelope (this is

only available if you

requested a printed copy).

Delinquent Section 16(a) Reports

Role of the Board

Corporate Responsibility

Board Leadership Structure

Nomination Process

Board Oversight of Risk

Board Meetings and Committees

Policy on Transactions with Related Persons

Transactions with Related Persons

Insider Trading Policy

Compensation and Leadership Committee Interlocks and Insider Participation

Stockholder Engagement During Fiscal 2024

Communications with the Board of Directors

Executive Summary

Elements of Compensation

Compensation Decision Process

CEO Compensation

Impact of the Internal Revenue Code

The Compensation and Leadership Committee Report

Fiscal 2024 Summary Compensation Table

Grants of Plan-Based Awards for Fiscal 2024

Option Exercises and Stock Vested in Fiscal 2024

Outstanding Equity Awards as of May 31, 2024

Potential Payments upon Termination or Change in Control Fiscal 2024

Non-Qualified Deferred Compensation Fiscal 2024

CEO Pay Ratio

Pay Versus Performance

Policies and Practices Related to the Grant of Certain Equity Awards

Fees for Professional Services

Report of The Audit Committee

 Proxy Summary 

October 10, 2024

9:30 a.m., Eastern Time

Virtual Meeting at:

www.virtualshareholdermeeting.com/PAYX2024

Board Vote

Recommendation

Page Reference

(for more detail)

FOR each director nominee

 5

 Proxy Summary 

  Total service revenue  

Operating income

Diluted earnings per share

  Total returned to stockholders⁽¹⁾  

Operating income,
net of certain items⁽²⁾

Adjusted diluted earnings
per share⁽²⁾

Percent increase reflects growth percentages compared to fiscal 2023

Reflects dividends and repurchases of outstanding shares of our common stock.

Operating income, net of certain items and adjusted diluted earnings per share are not United States generally accepted accounting principles (“GAAP”) measures. Refer to “Paychex, Inc. Non-GAAP Financial Measures” in Appendix A of this proxy statement for a discussion of these non-GAAP measures and a reconciliation of the most comparable GAAP measure of operating income and diluted earnings per share.

Dividends Paid

Share Repurchases

 Proxy Summary 

World’s Most Ethical Companies^®

Paychex has been named among one of the 2024 World’s Most Ethical Companies^® on Ethisphere‘s annual list for the 16th time.

HR Tech Award

Paychex was recognized by Lighthouse Research & Advisory for the fifth consecutive year as a Best Small Business-focused Solution in the Core HR/Workforce category.

FORTUNE^® Magazine America’s’ Most Innovative Companies

Paychex was again named one of America’s Most Innovative Companies, recognizing its

commitment to industry-leading HR solutions while fostering a culture of innovation.

Sapient Insights Group “Top Five” Vendor

Paychex earned six spots as a “Top Five” vendor solution for small- and medium-sized businesses based directly on Paychex customer feedback for vendor satisfaction and user experience.

America’s Climate Leaders

Paychex has been recognized for the second consecutive year by USA Today on the 2024 America’s Climate Leaders List for the Company’s achievement in reducing its core emissions and carbon footprint.

Training APEX Award

Paychex has been recognized by Training magazine as one of the top training organizations in the world for the 23rd consecutive time.

A significant portion of annual compensation is “at risk” based on performance. For the President and Chief Executive Officer (“CEO”), 89% of his total target compensation is at risk. On average, for the other named executive officers (“NEOs”) (excluding Mr. Rivera), 80% of their total target compensation is at risk.

Variable compensation is comprised of an annual cash incentive program and longer-term equity-based incentives. For the annual cash incentive for fiscal 2024, results for certain performance metrics were below target, resulting in payouts at 62.6% of target for the CEO and 56.9% of target for the other NEOs, excluding Mr. Rivera.

Performance stock awards granted in July 2022 reached the end of the two-year performance period in May 2024. Achievement was at 107% of target. The awards earned are restricted for an additional one-year period.

 Proxy Summary 

statements with respect to the beliefs, plans, objectives, and expectations regarding the future compensation plans of the Company and corporate responsibility initiatives and goals of the Company; and

statements preceded by, followed by, or that include the words “aim,” “anticipate,” “believe,” “could,” “design,” “estimate,” “goal,” “intend,” “may,” “plan,” “potential,” “project,” “should,” “strategy,” “strive,” “target,” “will,” “would,” or similar expressions.

 Election of Directors 

PROPOSAL 1:

ELECTION OF DIRECTORS FOR A ONE-YEAR TERM

What am I voting on?

Voting Recommendation

Stockholders are being asked to elect eleven director nominees for a one-year term. This section includes information about the Board and each director nominee.

 Election of Directors 

The Board recommends the election of each of the director nominees identified on the following pages. Unless otherwise directed, the named proxy holders will vote the proxy FOR the election of each of these director nominees.

are seasoned leaders who possess high personal and professional ethics and share the values of the Company;

are highly accomplished in their fields and have served as directors and officers in a diverse range of companies, including technology, financial services, and payment companies, among others;

strengthen our Board’s oversight capabilities by having varied lengths of tenure that provide historical and new perspectives about our Company; and

bring extensive and diverse experience in strategic planning, business development, international business, mergers and acquisitions, and go-to-market strategies, among others.

 Election of Directors 

Board Diversity Matrix

 Election of Directors 

 Martin Mucci — Chairman of the Board of Paychex, Inc.

Director since 2010

Current Public Company Directorships:

•  Cintas Corporation

Prior Public Company Directorships (Past Five Years):

•  NCR Corporation

Age: 64

Board Committees:

•  Executive (Chair)

Mr. Mucci is Chairman of the Board of Directors of the Company. He served as President and Chief Executive Officer (“CEO”) of the Company from September 2010 until December 2021 and as Chairman of the Board and CEO of the Company from December 2021 until October 2022 when he retired from service as CEO. Mr. Mucci joined the Company in 2002 as Senior Vice President (“SVP”), Operations. Prior to joining Paychex, he held senior level positions with Frontier Communications of Rochester, a telecommunications company, including President of Telephone Operations and CEO of Frontier Telephone of Rochester, over the course of his 20-year career. Mr. Mucci currently serves on the board of Cintas Corporation, a leading provider of uniform rental, facility services, first aid, and safety products to over one million businesses of all types and sizes. He is also a member of the Business and Government Software and Services Advisory Team for Madison Dearborn Partners. Mr. Mucci was a member of the Board of Directors of NCR Corporation, a software, consulting and technology company, until it was split into two separate companies in October 2023. Mr. Mucci was a member of the Board of Directors of Cbeyond, Inc., a telecommunications company focused on small businesses, until it was purchased by Birch Communications in July 2014. He is a Trustee Emeritus of St. John Fisher College.

SPECIFIC QUALIFICATIONS AND SKILLS:

The Board has concluded that Mr. Mucci is qualified to lead the Board due to his experience providing day-to-day leadership as the former President and CEO of Paychex, giving him extensive knowledge of the Company, its operations, challenges, and opportunities. In addition, Mr. Mucci’s educational background and senior leadership experience provide him with strong financial literacy.

 Thomas F. Bonadio — Founder and Chairman of The Bonadio Group

Director since 2017

Current Public Company Directorships:

None

Prior Public Company Directorships (Past Five Years):

•  CurAegis Technologies, Inc.

Age: 75

Board Committees:

•  Audit

•  Corporate Development Advisory

•  Nominating and Governance

Independent

Mr. Bonadio is the founder and Chairman of the Board of Directors of The Bonadio Group, the 41st largest Certified Public Accountant firm in the U.S. and the largest independent provider of accounting, business advisory, and financial services in New York State outside of Manhattan. He has devoted his efforts to serving commercial companies in the Rochester area and helping The Bonadio Group grow from two people to its present size of 1,100 employees. Mr. Bonadio is also the General Partner of Impact Capital, a venture capital firm focused on growing companies operating in Upstate New York, and serves on the Board of Directors of Viridi, a private company with sustainable solutions in energy storage systems and electrical equipment. He also serves on the Board of Directors and as the Audit Committee Chair for Royal Oak, a private real estate investment trust. Mr. Bonadio has experience serving on community organizations as well as both not-for-profit and publicly traded boards. He also previously served on the Board of Directors and as the Audit Committee Chair for Conceptus, Inc., a medical device company, until it was purchased by Bayer AG of Germany in June 2013.

SPECIFIC QUALIFICATIONS AND SKILLS:

The Board has concluded that Mr. Bonadio is qualified to serve as a director of the Company due to his strong background in finance and business, his entrepreneurial experience, and his knowledge of the Certified Public Accountant community. Mr. Bonadio is a successful entrepreneur whose experience building his own business is representative of many clients Paychex serves today. He also brings a high degree of financial literacy obtained from his years in the financial services industry, and his ability to assess financial performance of other companies through the review and understanding of financial statements. This financial expertise is a great benefit to the Board and its committees.

 Election of Directors 

 Joseph G. Doody — Former Vice Chairman of Staples, Inc.

Director since 2010

Current Public Company Directorships:

•  Casella Waste Systems, Inc.

Prior Public Company Directorships (Past Five Years):

•  Virtusa Corporation

Age: 72

Board Committees:

•  Investment

•  Nominating and Governance

Independent

Mr. Doody served as Vice Chairman of Staples, Inc., an office products company, from February 2014 until his retirement in September 2017. Mr. Doody served Staples, Inc. since 1998 in various roles including President, North American Commercial, from January 2013 until February 2014, and President, North American Delivery, from March 2002 to January 2013. Mr. Doody serves on the Board of Directors of Casella Waste Systems, Inc., a vertically integrated waste management company. Mr. Doody previously served on the Board of Directors of Virtusa Corporation, a global provider of digital engineering and information technology outsourcing services that accelerate business outcomes for its clients, until it was acquired in February 2021. Mr. Doody is an emeritus member of the Foundation Board at The College at Brockport.

SPECIFIC QUALIFICATIONS AND SKILLS:

The Board has concluded that Mr. Doody is qualified to serve as a director of the Company due to his significant leadership and international experience. His long tenure in management of a large division of a multinational company enables him to provide our Board with important operational expertise. In addition, his deep knowledge of small- to medium-sized businesses brings a thorough understanding of the risks and opportunities affecting the Company’s clients and potential clients. Mr. Doody also has extensive experience in strategic planning and business development, which allows him to provide valuable input into the Company’s plans for market growth.

 John B. Gibson — President and Chief Executive Officer of Paychex, Inc.

Director since 2022

Current Public Company Directorships:

None

Prior Public Company Directorships (Past Five Years):

None

Age: 58

Board Committees:

•  Corporate Development Advisory

•  Executive

Mr. Gibson has served as President and CEO of the Company since October 2022. Prior to serving as President and CEO, Mr. Gibson was promoted to the role of President and Chief Operating Officer (“COO”) in December 2021, leading the daily operations of the Company, including sales, service, marketing, and management. Mr. Gibson joined Paychex as SVP of Service in May 2013, bringing with him more than 20 years of experience in human resources (“HR”) solutions, technology, and business services. Prior to Paychex, Mr. Gibson served in senior executive positions at HR outsourcing and technology companies, including Ameritech (now AT&T) and Convergys (now Concentrix), where he served as President of the HR Management division providing comprehensive global HR solutions to clients in 68 countries.

SPECIFIC QUALIFICATIONS AND SKILLS:

The Board has concluded that Mr. Gibson is qualified to serve as a director of the Company due to his leadership and experience. Mr. Gibson has been a key leader in the Company’s digital expansion, its service transformation, and the expansion of its professional employer organization and HR advisory services. His deep understanding of the Company’s market and focus on driving innovative technology and HR advisory solutions for the Company’s more than 745,000 clients (as of May 31, 2024) make him a valued addition to the Board.

 Election of Directors 

 B. Thomas Golisano — Founder of Paychex, Inc.

Director since 1979

Current Public Company Directorships:

None

Prior Public Company Directorships (Past Five Years):

•  Twinlab Consolidated Holdings, Inc.

•  Eastman Kodak Company

Age: 82

Board Committees:

•  Executive

Mr. Golisano founded Paychex in 1971 and served as Chairman of the Board of Directors until December 2021. He served as President and CEO of the Company until October 2004. Mr. Golisano is an entrepreneur, philanthropist, and civic leader who has been committed to building innovative businesses, supporting numerous not-for-profit organizations, and advocating for inclusive health and various civic issues. Mr. Golisano also serves as a director of numerous other not-for-profit organizations and private companies and founded the Golisano Institute for Business and Entrepreneurship, a provider of alternative post-secondary business education. He is the founder and a member of the Board of Trustees of the B. Thomas Golisano Foundation and is a Trustee Emeritus of Rochester Institute of Technology.

SPECIFIC QUALIFICATIONS AND SKILLS:

The Board has concluded that Mr. Golisano is qualified to serve as a director of the Company due to his relevant executive leadership experience and extensive knowledge of the operations of the Company. These skills were attained through his former roles of Chairman and CEO of Paychex. In addition, his experience investing in and supporting numerous successful start-up businesses equips him with expertise in identifying market opportunities, which allows him to provide valuable insights and guidance to the Board.

 Pamela A. Joseph — CEO and Executive Chair of Xplor Technologies

Director since 2018

(previously served from 2005 – 2017)

Current Public Company Directorships:

•  Adyen N.V. (Euronext)

•  TransUnion (Chair)

Prior Public Company Directorships (Past Five Years):

None

Age: 65

Board Committees:

•  Compensation and Leadership

•  Corporate Development Advisory

•  Nominating and Governance (Chair)

Independent

Ms. Joseph has served as the CEO of Xplor Technologies, a cloud-based payment processing platform company, since October 2022, and as Xplor’s Executive Chair since 2021. Ms. Joseph previously served as the CEO of Clearent, a full-service payment-solutions provider from 2019 to 2021. She is also an Operating Partner of Advent International, a global private equity firm. From May 2016 until September 2017, she served as President, COO, and Board Member of Total System Services, Inc., a provider of issuer services and merchant payment acceptance for credit, debit, prepaid, healthcare, and business solutions. She was Vice Chair of U.S. Bancorp Payment Services and Chair of Elavon (formerly NOVA Information Systems, Inc.), a wholly owned subsidiary of U.S. Bancorp, from December 2004 until June 2015. U.S. Bancorp Payment Services and Elavon manage and facilitate consumer and corporate card issuing, as well as payment processing. Ms. Joseph also serves as Board Chairperson for TransUnion, a leading global information and insights company, and as a member of the Board of Directors and audit committee of Adyen N.V., a Netherlands-based payments platform business.

SPECIFIC QUALIFICATIONS AND SKILLS:

The Board has concluded that Ms. Joseph is qualified to serve as a director of the Company due to her extensive executive experience in the financial services and payment industries. Her wealth of technology experience brings insight to the Board and its committees. In addition, her experience with major acquisitions, board experience, and international expansion allows her to provide valuable input to the Company’s growth plans.

 Election of Directors 

Theresa M. Payton — Founder, President, and CEO of Fortalice Solutions

Director since 2023

Current Public Company Directorships:

None

Prior Public Company Directorships (Past Five Years):

None

Age: 57

Board Committees:

•  Audit

Independent

Ms. Payton is the Founder, President, and CEO of Fortalice Solutions, LLC an industry-leading security consulting company advising Fortune 150 Boards, C-Suite, and regulators on secured technology innovation and transformation efforts regarding customer delivery and privacy. Fortalice Solutions has completed over 500 global engagements advising and securing digital transformation programs and delivering business intelligence services for some of the nation’s largest organizations. Ms. Payton was also co-founder of Dark Cubed, a cybersecurity solutions company founded in 2015, which was acquired by Celerium, a leader in innovative cyber defense solutions, in September 2022. She spent over 16 years in the financial services industry including executive roles in banking technology for two of the country’s top financial institutions and was Chief Information Officer for the White House under the George W. Bush administration. She serves on the Federal Advisory Board of CyberArk, a publicly traded cybersecurity product company, and previously served as a member of the Transformation Innovation Advisory Board of UniCredit S.p.A., the largest pan-European bank headquartered in Milan, Italy, from January 2019 through August 2022.

SPECIFIC QUALIFICATIONS AND SKILLS:

The Board has concluded that Ms. Payton is qualified to serve as a director of the Company due to her significant technology and cybersecurity expertise and experience as an entrepreneur. Her business acumen, intense focus on the needs of clients, and her ability to provide sound governance insights on digital and security risks make her a valuable contributor to the Board.

 Kevin A. Price — Founder & President of KAP Holdings, LLC d/b/a PartScription^TM

Director since 2021

Current Public Company Directorships:

None

Prior Public Company Directorships (Past Five Years):

None

Age: 64

Board Committees:

•  Audit

•  Nominating and Governance

Independent

Mr. Price is the Founder and President of KAP Holdings, LLC d/b/a PartScription, which he founded in 2006. KAP Holdings, LLC is a service company engaged in the distribution, wholesaling, and sourcing of products and parts to private and governmental agencies across a broad range of categories with integrated solutions to eliminate cost, lost time, and frustration in construction and renovation projects. PartScription is a fast growing, innovative ecommerce platform that aggregates millions of parts into a single search and order platform to improve selection, service, and profitability for retail hardware stores. Prior to his founding of KAP Holdings, LLC, he worked at Sears Holdings Corporation as the Vice President of the Customer Care Network where he managed Sears Parts Direct and the aftermarket insurance businesses, at Ameritech Corporation as Vice President of Sales and Planning and Administration, and as Senior Vice President of Operations at AC Nielsen. Mr. Price is an emeritus board member of Link Unlimited, and served on the Brennan School of Business Advisory Board at Dominican University and the College of Business and Public Administration Advisory Council at Drake University.

SPECIFIC QUALIFICATIONS AND SKILLS:

The Board has concluded that Mr. Price is qualified to serve as a director of the Company due to his extensive experience as an entrepreneur and significant executive leadership and e-commerce experience. Mr. Price is a strategic leader who has provided agile leadership to help drive business success. His experience is a great benefit to the Board and its committees.

 Election of Directors 

Joseph M. Tucci — Chairman and Co-Founder of Bridge Growth Partners, LLC

Lead Independent Director

Director since 2000

Current Public Company Directorships:

•  Motorola Solutions, Inc.

Prior Public Company Directorships (Past Five Years):

•  GTY Technology Holdings, Inc.

Age: 77

Board Committees:

•  Compensation and Leadership (Chair)

•  Executive

•  Nominating and Governance

Independent

Mr. Tucci is the Co-founder and Chairman of the Board of Directors of Bridge Growth Partners, LLC, a private equity firm based in New York and founded in 2013. He serves on the Board of Directors of Motorola Solutions, Inc., a global leader in public safety and enterprise security, and Syniti, an enterprise data management solutions company. Mr. Tucci was the former Chairman of the Board of Directors and CEO of EMC Corporation (“EMC”), a provider of data-storage systems. He was EMC’s Chairman from January 2006 and CEO from January 2001 until September 2016, when Dell Technologies acquired the company. He was Chairman of the Board of Directors of VMWare, Inc., a cloud infrastructure company, from 2007 through September 2016.

SPECIFIC QUALIFICATIONS AND SKILLS:

The Board has concluded that Mr. Tucci is qualified to serve as a director of the Company due to his extensive executive leadership experience as CEO of EMC. Mr. Tucci has spent over 40 years in the technology industry in senior roles at large, complex, and global technology companies. His experience leading EMC through a period of dramatic revitalization, growth and market share gains, and new product introductions enables him to share knowledge of the challenges a company faces due to rapid changes in the marketplace.

 Joseph M. Velli — Retired Financial Services and Technology Executive

Director since 2007

Current Public Company Directorships:

•  AssetMark Financial Holdings

•  Cognizant Technology Solutions Corp.

•  Computershare Ltd. (Australian Stock Exchange)

Prior Public Company Directorships (Past Five Years):

None

Age: 66

Board Committees:

•  Compensation and Leadership

•  Corporate Development Advisory (Chair)

•  Executive

•  Investment (Chair)

Independent

Mr. Velli currently serves on the Board of Directors of Computershare Limited, a global provider of corporate trust, stock transfer, employee share plan, and mortgage servicing services. He serves on the Board of Directors of Cognizant Technology Solutions Corp., a multinational corporation that provides information technology services. Mr. Velli is also on the Board of Directors of AssetMark Financial Holdings, Inc., a wealth management technology platform for independent financial advisors and their clients. Mr. Velli previously served as Senior Executive Vice President of The Bank of New York and as a member of the Senior Policy Committee until October 2006. During his 22-year tenure with The Bank of New York, he headed Global Issuer Services, Global Custody and Investor Services, Global Liquidity Services, Pension and 401(k) Services, and Retail Banking. He served as Chairman and CEO of ConvergEx Group, LLC (“ConvergEx”), a provider of brokerage, software products, and technology services, from 2006 to 2013, and continued to serve on the ConvergEx Board until 2014. Mr. Velli has been a member of the Board of Trustees of William Paterson University since June 2017. He acts as an advisory council member to Lovell Minnick Partners, a venture capital and private equity firm, and provides advisory services to other private equity firms.

SPECIFIC QUALIFICATIONS AND SKILLS:

The Board has concluded that Mr. Velli is qualified to serve as a director of the Company due to his extensive experience with securities servicing, financial technology, capital markets, business to business, sales and marketing, and mergers and acquisitions matters, as well as his public board experience. He plays a key role in the Board’s discussions of the Company’s investments and liquidity. Mr. Velli has extensive experience with acquisitions and business services, providing valuable insights on potential growth opportunities for the Company.

 Election of Directors 

 Kara Wilson — Senior Advisor at KKR & Co. Inc.

Director since 2017

Current Public Company Directorships:

None

Prior Public Company Directorships (Past Five Years):

•  KnowBe4

Age: 54

Board Committees:

•  Audit

•  Corporate Development Advisory

Independent

Ms. Wilson currently serves as a Senior Advisor at KKR & Co. Inc., a global investment firm that manages multiple alternative asset classes, including private equity, energy, infrastructure, real estate, and credit, with strategic partners that manage hedge funds. She currently serves on a number of private, software solution company boards including Alludo, OneStream, OutSystems, and ReliaQuest. She previously served on the Board of Directors of KnowBe4, a security awareness computer-based training firm that assists companies in strengthening their security through their employees, until it was acquired in February 2023. She was formerly Chief Marketing Officer at Rubrik, Inc., a cloud data management company, a role she held from June 2017 until May 2019. She has over 20 years of experience in driving go-to-market strategies for large, medium, and hyper-growth start-ups. She has held marketing leadership roles with some of the technology industry’s most influential companies, including Cisco Systems, SAP, SuccessFactors, PeopleSoft/Oracle, Okta, and FireEye, Inc. Prior to Rubrik, Inc. from October 2016 to June 2017, Ms. Wilson was Executive Vice President and from August 2013 to June 2017, Chief Marketing Officer of cyber security company FireEye, where she helped launch FireEye’s initial public offering and was responsible for the company’s global marketing initiatives including corporate, product, and technical marketing, global communications, and field enablement.

SPECIFIC QUALIFICATIONS AND SKILLS:

The Board has concluded that Ms. Wilson is qualified to serve as a director of the Company due to her extensive experience in driving go-to-market strategies for enterprise technology companies. The Board can benefit from Ms. Wilson’s marketing experience to help Paychex with the development and execution of go-to-market strategies to effectively differentiate the Company in a highly competitive and constantly evolving industry. Ms. Wilson has experience at global companies and can provide insight on any expansion of the Company’s global presence.

 Director Compensation 

DIRECTOR COMPENSATION

FOR THE FISCAL YEAR ENDED MAY 31, 2024

Name

(a)

Fees Earned

or Paid in

Cash
(b)

Total

Martin Mucci

$195,000

$109,016

$108,990

$413,006

Thomas F. Bonadio

$125,000

$ 92,458

$ 92,498

$309,956

Joseph G. Doody

$112,500

$ 92,458

$ 92,498

$297,456

David J.S. Flaschen⁽¹⁾

$157,500

$ 92,458

$ 92,498

$342,456

B. Thomas Golisano

$272,500

$   —

$   —

$272,500

Pamela A. Joseph

$140,000

$ 92,458

$ 92,498

$324,956

Theresa M. Payton⁽²⁾

$107,500

$138,989

$138,993

$385,482

Kevin A. Price

$117,500

$ 92,458

$ 92,498

$302,456

Joseph M. Tucci

$195,000

$ 92,458

$ 92,498

$379,956

Joseph M. Velli

$132,500

$ 92,458

$ 92,498

$317,456

Kara Wilson

$115,000

$ 92,458

$ 92,498

$299,956

As previously announced by the Company, Mr. Flaschen will not stand for reelection as a director, and his current term will expire at the Annual Meeting.

Ms. Payton was appointed to the Board in January 2023 and began attending Board meetings in the fourth quarter of the fiscal year ended May 31, 2023 (“fiscal 2023”). In July 2023, she received an annual equity award for fiscal 2024 that was enhanced for her service on the Board during fiscal 2023.

 Director Compensation 

Compensation Element

Annual cash retainer

$95,000

Audit Committee member annual retainer

$12,500

C&L Committee member annual retainer

$10,000

N&G Committee member annual retainer⁽¹⁾

$10,000

Investment Committee member annual retainer

$ 7,500

Executive Committee member annual retainer

$ 7,500

Corporate Development Advisory Committee member annual retainer

$ 7,500

Lead Independent Director annual retainer⁽²⁾

$50,000

Audit Committee Chair annual retainer⁽³⁾

$25,000

C&L Committee Chair annual retainer⁽³⁾

$22,500

N&G Committee Chair annual retainer⁽¹⁾⁽³⁾

$17,500

Corporate Development Advisory Committee Chair annual retainer⁽³⁾

$ 2,500

Investment Committee Chair annual retainer⁽³⁾

$ 2,500

Upon Board approval in July 2024, the Nominating and Environmental, Social, and Governance (“ESG”) Committee’s name was changed to the N&G Committee. The primary oversight and responsibilities of the committee remain unchanged.

The Lead Independent Director receives the Lead Independent Director annual retainer in addition to the annual cash retainer.

The committee chair receives the chair annual retainer in addition to the respective committee member retainer.

 Director Compensation 

Grant Date

July 15, 2023

July 15, 2023

Exercise Price

N/A

$120.86

Quantity

See⁽¹⁾

See⁽¹⁾

Fair Value⁽²⁾

$120.86

$27.35

Vesting Schedule

On the first anniversary of the date of grant.

On the first anniversary of the date of grant.

All independent directors, except for Ms. Payton, were granted 765 time-based RSUs and 3,382 stock options. Ms. Payton was granted 1,150 time-based RSUs and 5,082 stock options. Mr. Mucci was granted 902 time-based RSUs and 3,985 stock options.

The fair value of time-based RSUs is determined based on the closing price of the underlying common stock on the grant date. The fair value of stock options is determined using a Black-Scholes option pricing model. The assumptions used in determining the July 15, 2023 fair value of $27.35 per share for these stock options were: risk-free interest rate of 4.0%; dividend yield of 3.1%; volatility factor of 0.25; and expected option life of 7.0 years.

Retirement eligibility for this purpose begins at age 55 or older with ten years of service as a member of the Board.

Stock

Awards

(Shares)

Stock

Options

(Shares)

Martin Mucci

48,582  

1,541,726  

Thomas F. Bonadio

765  

47,866  

Joseph G. Doody

765  

33,847  

David J.S. Flaschen⁽¹⁾

765  

27,431  

B. Thomas Golisano

—  

—  

Pamela A. Joseph

765  

36,007  

Theresa M. Payton

1,150  

5,082  

Kevin A. Price

765  

11,484  

Joseph M. Tucci

765  

65,171  

Joseph M. Velli

765  

65,171  

Kara Wilson

765  

43,462  

As previously announced by the Company, Mr. Flaschen will not stand for reelection as a director, and his current term will expire at the Annual Meeting.

 Director Compensation 

speculatively trade in Paychex stock;

short sell any securities of the Company; or

buy or sell puts or calls on the Company’s securities.

 Beneficial Ownership 

BENEFICIAL OWNERSHIP OF

PAYCHEX COMMON STOCK

each principal stockholder known to be a beneficial owner of more than 5% of the Company’s common stock. This includes any “group” as that term is used in Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”);

each director and nominee for director;

each of the Company’s named executive officers (“NEOs”); and

all directors, NEOs, and executive officers of the Company as a group.

Amount of

Shares Owned⁽¹⁾

Non-vested

Shares of

Restricted

Stock⁽²⁾

Stock Options

Exercisable by

September 29,

2024⁽³⁾

Total Shares

Beneficially

Owned

Percent

of

Class

Principal Stockholders:

B. Thomas Golisano^(4),(5)

1 Fishers Road

Pittsford, NY 14534

37,831,243   

—   

—   

37,831,243   

10.4

%    

Vanguard Group Inc.⁽⁶⁾

100 Vanguard Blvd.

Malvern, PA 19355

30,417,301   

—   

—   

30,417,301   

8.4

%    

BlackRock Inc.⁽⁷⁾

55 East 52nd Street

New York, NY 10001

27,959,696   

—   

—   

27,959,696   

7.7

%    

Capital International Investors⁽⁸⁾

333 South Hope Street, 55th Fl

Los Angeles, CA 90071

18,601,536   

—   

—   

18,601,536   

5.1

%    

Directors:

Martin Mucci

439,476   

—   

1,334,925   

1,774,401   

*

*    

Thomas F. Bonadio

19,615   

—   

47,866   

67,481   

*

*    

Joseph G. Doody⁽⁹⁾

23,758   

—   

33,847   

57,605   

*

*    

David J.S. Flaschen⁽¹⁰⁾

51,302   

—   

17,816   

69,118   

*

*    

80,823   

467   

176,827   

258,117   

*

*    

B. Thomas Golisano^(4),(5)

37,831,243   

—   

—   

37,831,243   

10.4

%    

Pamela A. Joseph

10,881   

—   

36,007   

46,888   

*

*    

1,911   

—   

5,082   

6,993   

*

*    

Kevin A. Price

3,062   

—   

11,484   

14,546   

*

*    

Joseph M. Tucci

54,986   

—   

65,171   

120,157   

*

*    

Joseph M. Velli

70,616   

—   

65,171   

135,787   

*

*    

Kara Wilson

7,365   

—   

43,462   

50,827   

*

*    

Named Executive Officers:

*

*    

John B. Gibson

80,823   

467   

176,827   

258,117   

*

*    

Robert L. Schrader

17,677   

—   

46,706   

64,383   

*

*    

81,437   

—   

391,850   

473,287   

*

*    

Michael E. Gioja⁽¹¹⁾

24,463   

—   

168,114   

192,577   

*

*    

Elizabeth Roaldsen

3,864   

—   

4,054   

7,918   

*

*    

All directors, NEOs, and executive officers of the Company as a group (20 persons)

38,736,832   

467   

2,452,838   

41,190,137   

11.4

%    

 Beneficial Ownership 

Indicates that percentage is less than 1%.

This column reflects shares held of record and Company shares owned through a bank, broker, or other holder of record. For executive officers, this also includes shares owned through the Paychex, Inc. 401(k) Incentive Retirement Plan (the “401(k) Plan”).

This column includes stock awards to independent directors and executive officers that have not yet vested. These non-vested stock awards have voting and dividend rights, and thus are included in beneficial ownership.

This column includes shares that may be acquired upon exercise of options, which are exercisable on or prior to September 29, 2024. Under SEC rules, shares that may be acquired within 60 days are included in beneficial ownership.

Included in shares beneficially owned for Mr. Golisano are: 278,068 shares owned by the B. Thomas Golisano Foundation, of which Mr. Golisano is a member of the foundation’s nine-member board of trustees (Mr. Golisano disclaims beneficial ownership of these shares but does share voting and investment power); 44,323 shares held in the name of family members, trusts, or other entities of Mr. Golisano (Mr. Golisano shares voting and investment power of these shares); and 37,508,852 shares, held in the name of a trust for which Mr. Golisano is the trustee and beneficiary (Mr. Golisano has sole voting and investment power of these shares).

Mr. Golisano has 7,671,875 shares pledged as security. Mr. Golisano’s pledge of these shares has been disclosed since 2007 and, as such, occurred well before the enactment of our updated pledging policy in January 2020.

Beneficial ownership is based on information as of December 29, 2023, contained in the Schedule 13G/A filed with the SEC on February 13, 2024 by Vanguard Group Inc., including notice that it has sole dispositive power as to 28,969,814 shares, shared voting power as to 433,035 shares, and shared dispositive power as to 1,447,487 shares.

Beneficial ownership is based on information as of December 31, 2023, contained in the Schedule 13G/A filed with the SEC on January 26, 2024 by BlackRock, Inc., including notice that it has, along with certain institutional investment managers for which it is the parent holding company, sole voting power as to 25,155,004 shares, and sole dispositive power as to 27,959,696 shares.

Beneficial ownership is based on information as of December 29, 2023, contained in the Schedule 13G filed with the SEC on February 7, 2024 by Capital International Investors, including notice that it has sole dispositive power as to 18,557,035 shares and shared dispositive power as to 18,601,536 shares.

Included in shares beneficially owned for Mr. Doody are 22,997 shares held in the name of a trust for which Mr. Doody is the trustee and beneficiary. Mr. Doody has sole voting and investment power of these shares.

Included in shares beneficially owned for Mr. Flaschen are 12,671 shares held in the name of family members, trusts, or other entities of Mr. Flaschen. Mr. Flaschen shares voting and investment power of these shares.

Included in shares beneficially owned for Mr. Gioja are 3,463 shares held in the name of a trust for which Mr. Gioja is the trustee and beneficiary. Mr. Gioja has sole voting and investment power of these shares.

 Corporate Governance 

CORPORATE GOVERNANCE

We hold ourselves to the highest ethical standards: doing business the right way and conducting ourselves with integrity.

Governance guides us as we strive to deliver long-term success and maximize stockholder value.

Privacy and security of personal and account information are among our top priorities.

We are committed to managing our environmental impact as an integral part of our operations.

Our programs support our employees’ total well-being, professional growth, and sense of community.

We are committed to providing our employees with a safe working environment.

 Corporate Governance 

Our CEO is a signatory of the CEO Action for Diversity & Inclusion Pledge, which demonstrates that DE&I is a top priority of the Company and is supported by Company leadership;

Targeted recruitment activities including using tools such as training of Company recruiters and using dashboards and scorecards to track hiring, mobility, and attrition of diverse applicants;

Training and guidance regarding diversity aimed at increasing awareness with our employees and clients;

Mentorship programs to connect women and people of color to executive leaders, mentors, and promotional opportunities;

Creation of several Employee Business Resource Groups to foster community, development and cultural celebration for employees of underrepresented backgrounds and their allies;

Philanthropic support to organizations that support diverse communities and initiatives that align with our values; and

Established goals related to DE&I and governance, climate and corporate responsibility for executive incentive compensation plans for all executives for fiscal 2024.

 Corporate Governance 

Chairman of the Board and a non-independent director (Mr. Mucci);

President and CEO as a non-independent director (Mr. Gibson);

an independent director serving as Lead Independent Director (Mr. Tucci); and

Audit, C&L, Corporate Development Advisory, Investment, and N&G committees led by independent directors.

 Corporate Governance 

 Corporate Governance 

All members of the Audit Committee, which was established in accordance with Section 3(a)(58)(A) of the Exchange Act, meet the independence, experience, and other applicable Nasdaq listing requirements and applicable SEC rules regarding independence.

All members of the C&L Committee meet the Nasdaq independence criteria for compensation committee members.

All members of the N&G Committee meet the Nasdaq independence criteria for directors overseeing director nominations.

Upon Board approval in July 2024, the Nominating and ESG Committee’s name was changed to the N&G Committee. The primary oversight and responsibilities of the committee remain unchanged.

Mr. Bonadio and Mr. Flaschen each qualify as an “Audit Committee Financial Expert,” as defined by applicable SEC rules.

As previously announced by the Company, Mr. Flaschen will not stand for reelection as a director, his current term will expire in conjunction with the Annual Meeting.

 Corporate Governance 

Audit Committee

Primary Risk Oversight Areas

•  Internal controls;

•  Risk related to financial statement accuracy and reporting;

•  Legal, regulatory, and compliance risks;

•  Risks related to security, technology, privacy, and data protection; and

•  Other operational and fraud risks.

Primary Responsibilities

•  Serve as an independent and objective party to monitor the Company’s financial reporting process, internal control system, and financial risk management processes;

•  Review the performance and independence of the Company’s independent accountants and internal audit department;

•  Provide an open avenue of communication among the independent accountants, financial and senior management, internal audit department, and the Board; and

•  Review significant risk exposures and processes to monitor, control, and report such exposures, periodically reporting on such information to the Board.

Compensation and Leadership Committee

Primary Risk Oversight Areas

•  Risks arising from the Company’s compensation policies and practices for all employees and non-employee directors.

Primary Responsibilities

•  Design and administer the Company’s executive and director compensation programs to ensure furtherance of the Company’s overall compensation objectives;

•  Evaluate and determine compensation for the CEO and senior executive officers and recommend director compensation to the Board;

•  Assist the Board in an annual review on succession planning and evaluating potential successors for executive management positions; and

•  Evaluate compensation policies to determine if they incentivize risks that are reasonably likely to have a material adverse effect on the Company.

 Corporate Governance 

Corporate Development Advisory Committee

Primary Risk Oversight Areas

•  Risk related to the Company’s acquisition and divesture opportunities.

Primary Responsibilities

•  Review and provide guidance to management and the Board with respect to the Company’s acquisition or divestiture opportunities, as appropriate, and review related strategy; and

•  Authority to approve acquisitions or divestitures in accordance with the parameters set by the Board, to the extent permitted by law and the Company’s By-Laws.

Executive Committee

Exercise all the powers and authority of the Board, except as limited by law, between Board meetings and when the Board is not in session.

Investment Committee

Risk related to investing activities.

Review the Company’s investment policies and strategies, and the performance of the Company’s investment portfolios; and

Determine that the investment portfolios are managed in compliance with the Company’s established investment policy.

Nominating and Governance Committee

Risks related to governance, climate, and corporate responsibility matters.

Identify, evaluate, and recommend candidates to be nominated for election to the Board;

Provide oversight of the governance of the Board to ensure that it meets its fiduciary obligations to the Company and its stockholders; and

Provide ongoing oversight of the company’s governance, climate, and corporate responsibility activities and performance.

 Corporate Governance 

Based on information in a Schedule 13G filed on January 26, 2024, Blackrock, Inc. and/or its affiliates (“Blackrock”) is an owner of more than 5% of the Company’s common stock, which makes Blackrock a “Related Person” of the Company under Item 404 of Regulation S-K. Blackrock has been a vendor of the Company since 2011. In fiscal 2024, the Company paid Blackrock approximately $1.8 million for investment management services.

The Company provides payroll and other ancillary services to Eastman Kodak Company (“Kodak”). Pursuant to the agreement between the Company and Kodak, Kodak paid the Company approximately $0.6 million in fees for these services during fiscal 2024. As a director and a beneficial owner of greater than 5% of the Company’s common stock, Mr. Golisano may be deemed to have an interest in this transaction, but is not expected to have any direct identifiable interest in this transaction. In addition to serving as a Board member of the Company, during a portion of fiscal 2024, Mr. Golisano also served as a director on Kodak’s Board of Directors as the designee of GO EK Ventures IV, LLC (“GO EK Ventures”). GO EK Ventures IV, LLC beneficially owns greater

 Corporate Governance 

CODE OF BUSINESS ETHICS AND CONDUCT

 Say-on-Pay Vote 

PROPOSAL 2:

ADVISORY VOTE TO APPROVE NAMED

EXECUTIVE OFFICER COMPENSATION

What am I voting on?

Voting Recommendation

The Board of Directors recommends a vote FOR the advisory vote approving the NEO compensation,

as disclosed in this proxy statement.

NEO compensation is evaluated and determined by our C&L Committee, which is comprised entirely of independent directors. This committee utilizes the services of an independent consultant to advise them on matters of executive compensation.

Our executive compensation program is designed to implement core compensation principles, including alignment with stockholders’ interests, long-term value creation, and pay-for-performance. A significant portion of pay is at risk where the amount realized will be dependent on achievement of financial targets or, in the case of certain time-vested equity awards, the value of the Company’s stock.

A mix of annual and long-term incentive programs creates a balance between short-term and long-term focus, reducing risk in the compensation programs.

Our equity-based, long-term incentive awards include a combination of stock options, time-based stock awards, and performance-based stock awards.

Stock ownership guidelines designed to align the directors’ and executives’ long-term financial interests with those of our stockholders.

Prohibition of hedging of the Company’s stock for both directors and executive officers.

 Say-on-Pay Vote 

Prohibition of pledging Company stock as collateral.

A long-standing insider trading policy.

A clawback policy applicable to our Annual Officer Performance Incentive Program (the “annual incentive program”) and performance-based stock awards.

Non-compete and other forfeiture provisions within our equity-based compensation agreements. These provisions allow the Company to cancel all or any outstanding portion of equity awards and recoup the gross value of any payouts under the annual incentive program, vested time-based stock awards, vested performance-based stock awards, or profits from exercises of options.

The Board recommends a vote FOR the proposal to approve the NEO compensation on an advisory basis,
as disclosed in this proxy statement.

 CD&A 

COMPENSATION DISCUSSION AND ANALYSIS

Name

Title

Total service revenue

Operating income

Diluted earnings per share

Total returned to stockholders⁽¹⁾

Operating income, net of certain items⁽²⁾

Adjusted diluted earnings per share⁽²⁾

Reflects dividends and repurchases of outstanding shares of our common stock.

Operating income, net of certain items and adjusted diluted earnings per share are not United States (“U.S.”) generally accepted accounting principles (“GAAP”) measures. Refer to “Paychex, Inc. Non-GAAP Financial Measures” in Appendix A of this proxy statement for a discussion of these non-GAAP measures and a reconciliation to the most comparable GAAP measure of operating income and diluted earnings per share.

 CD&A 

 CD&A 

We have returned over

$5.9 billion to stockholders over the

past 5 years.

 CD&A 

A significant portion of our NEOs’ annual compensation is “at risk” based on performance. For fiscal 2024, variable pay represented 89% of total target compensation for our CEO, Mr. Gibson, and 80% of total target compensation on average for our other NEOs (excluding Mr. Rivera);

Variable compensation is comprised of an annual cash incentive program and longer-term equity-based incentives. Stock options and time-based stock awards provide value based on our stock price performance. Annual grants of performance-based stock awards provide the opportunity for stock to be awarded if pre-established financial goals are met for a two-year performance period with full vesting provided after an additional one-year service period (i.e., total of three years);