Deloitte has cut about 250 employees in the UK who were deemed to be underperforming, marking at least the third time in the past 13 months that the Big Four accounting and consulting firm has axed staff.
The firm embarked on a round of job cuts affecting staff across its advisory divisions in recent weeks without announcing them across the business or within individual service lines, people familiar with the matter told the Financial Times.
The latest cull targeted about 250 staffers, or 1 per cent of Deloitte’s UK workforce, and came as a result of the firm’s “performance management processes”, the people said.
The move comes less than a month after Deloitte announced that its 749 UK equity partners took home more than £1 million (€1.2 million) on average for a fourth straight year, despite the firm suffering a sharp slowdown in sales growth during its latest financial year.
Richard Houston, Deloitte’s UK senior partner and chief executive, said at the time that the firm had to “carefully consider our cost base and make some difficult choices this year”.
The latest UK job cuts followed a warning by Deloitte in September last year that it was planning to make 800 employees redundant owing to a slowdown in demand for its services. In February, it axed 100 roles as part of a restructuring of its corporate advisory business.
The latest cuts within Deloitte’s advisory divisions underline the prolonged slowdown affecting the UK’s broader consulting market.
Revenues at Deloitte’s consulting division – its largest service line – declined by 1 per cent during the year to the end of May, while sales at its financial advisory practice declined by 2 per cent during the same period.
Deloitte and its Big Four rivals – EY, KPMG and PwC – significantly increased the size of their workforces to cope with a surge in demand during and after the pandemic, but all have cut jobs in the past year to cope with a market slowdown.
Deloitte has not made any firm-wide or division-wide announcements about the latest job cuts and some departing staff have had to sign non-disclosure agreements, said one person familiar with the matter. Affected staff received “appropriate payments for notice”, another person said.
The discreet nature of Deloitte’s cuts echoed a round of “silent lay-offs” at rival PwC earlier this year, when the firm told affected staff that they must not inform colleagues why they were leaving and had to follow a “suggested wording” if they wanted to send leaving messages to colleagues.
Deloitte has overhauled its operations in the UK in recent months as part of a global reorganisation of the firm’s service lines. Its main business units have been reduced to four – audit and assurance; strategy, risk and transactions; technology and transformation; and tax and legal – from the five the firm has had for the last decade.
Deloitte declined to comment. – Copyright The Financial Times Limited 2024
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