In a Wednesday message to staff, Deloitte Australia CEO Richard Deutsch shared the good news that although the firm had instituted pay cuts earlier in the year when no one really knew how bad things might get, they’re pulling a Mike Ehrmantraut and making their guys (and gals) whole.
Big four consulting firm Deloitte will repay the equivalent of 2.5 months of pandemic-related staff pay cuts after recording better-than-expected results in the first half of the firm’s 2021 financial year.
The move, along with an already-announced 10 extra days of COVID-19 leave for staff, means professionals at the big four firm will be completely repaid the pandemic pay cut – and end up with four days of extra leave on top of that.
It goes without saying that the 20% pay cut announced in May wasn’t too well-received by Down Under Green Dotters, though Deutsch called it “the least worst option” at the time. They went on to cut 700 people — or 7% of its Australian workforce — in June while the lucky remainder left standing were told the pay cut would be in place through September.
May might as well be 20 years ago so in case you’ve forgotten what exactly they cut, it ended up being a 25% cut for equity partners, a pay cut for 250 non-equity partners, an annualized staff pay cut of 8%, and the firm asked staff and partners to take one week of annual leave by June 30 along with an additional 10 days of leave between May and September.
At least one person at Deloitte didn’t like how everything added up (*ahem* no pun) when cuts and layoffs were announced, going to the Sydney Morning Herald to express their profound disappointment in the firm:
One of the Deloitte employees said pay packets should have been immediately reinstated once the company cut jobs. “After all the pay cuts were to avoid job losses.”
“After the redundancies the headcount matched production of the firm and therefore everyone is busy with work – no reason therefore to continue pay cuts. The only reason to continue pay cuts it to protect partner profit.”
Staff signed up to the in-house superannuation scheme also had life insurance payouts reduced by 20 per cent and many claim they were not told about these changes before they were implemented.
The employee said morale at the company had been destroyed as trust in the company’s strategy has been eroded. “This has hit employees hard. The integrity of the firm is gone.”
Wrote Financial Review on Wednesday:
The move was sold to staff as designed to preserve jobs at the firms but also had the effect of offsetting the reduction in partner profits caused by the recession.
Damn, I’m pretty sure they’re not supposed to say that part out loud. Anyhoo, with the reimbursement and the fact that the pay cuts ended earlier than planned, Deloitte Australia staff only lost about six days of paid work. Into the abyss, I suppose.
Deloitte announced its highest revenue to date in September, racking up an impressive $47.6 billion for FY 2020 ending May 31.
Deloitte becomes first big four firm to repay entire pandemic pay cut [Australian Financial Review]
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Didn’t Deloitte in Australia release a heap of people back into the market due to corona? I think they forgot about that lol
I’m pretty sure partners are allowed to protect profits. But good on them for making their guys and gals whole.