On a Friday all-hands call, EYers learned not to expect a bonus from Santa this year. This despite EY having its best year in 20 years.
In September, EY announced revenue of $45.4 billion for the fiscal year ended June 30, 2022, an increase of 13.7% from prior year and the most year-over-year growth the firm has seen in 20 years. The Americas region specifically brought in revenues of $21.1 billion, up 19% from FY21. “EY has achieved significant growth and continues to operate from a place of strength,” said EY Global Chairman and CEO Carmine Di Sibio in the obligatory revenue press release. “We have tremendous momentum right now, and growth means opportunity – for EY people, clients and broader stakeholders.”
So you can understand the disappointment that poured forth when staff heard on Friday that mid-year bonuses would not be coming.
In comments to Financial Times, EY acknowledged that they made a lot of money (YAY EY) but, you know, the economy sucks and all so better to be cautious:
For the past two years, EY US has paid merit bonuses to top performers around this time, on top of the main bonuses awarded at the end of its fiscal year in June, but there would not be funds available for the scheme in 2022, executives said.
“While EY continues to experience strong revenue growth, we have elected at this time not to fund our additional, discretionary mid-year program given the changing economic environment,” EY confirmed in a statement to the Financial Times.
“We remain steadfast in our commitment to being a leader in recognition and rewards. This includes our intention for planned annual performance-based bonuses and ongoing recognition awards,” it said. The mid-year scheme could be resurrected in future years.
Predictably, Redditors at competing firms are offering referrals to any unhappy folks at EY.
Some are assuming the firm is tightening its belt in anticipation of significant one-time costs that will arise should partners vote to move forward with the Project Everest split. A spun-off consulting arm could cost in the hundreds of millions of dollars to get off the ground.
As a reminder, this is what staff heard from up high this past February when EY issued its year-end compensation update (word for word from the email):
- As a result of our strong business performance, we allocated additional funding to our RAC program this year, allowing our partners to recognize more people for their individual performance and contribution. In addition to our RAC program, beginning next year in FY23, we plan to implement a discretionary mid-year recognition bonus program. This program will be separate from our annual PBB and will be funded based on firm performance as of mid-year. This provides an opportunity for our partners to recognize individuals based on their extraordinary performance and contributions throughout the year. We will share more about this program in the months ahead.
- Thanks to our strong year-to-date results and projections through year-end, we anticipate fully funding our PBB program for FY22. And similar to FY22, we expect FY23 compensation increases to be strong, competitive in the markets and aligned with the cost of living. You’ll receive notification of your base salary increase and applicable bonus amounts in your compensation statement on August 5.