PwC Australia sacks 366 staff after tax scandal
The embattled accounting and advisory firm will slash 329 staff and up to 37 partners as part of a major restructure following its tax scandal.
At least 329 PwC Australia staff will lose their jobs and a further 37 partners will leave the embattled accounting and advisory firm as part of a “simplified, efficient and centre-led” restructure.
PwC Australia chief executive Kevin Burrowes beamed into an all partners call on Wednesday, to outline plans to shake up the management of the company in the wake of moves to dump its government consulting arm.
Mr Burrowes read partners a letter later sent to staff outlining the firm’s plans, but declined to take any questions or give further details on the teams on the chopping block, said a person on the call.
Soon after, partners and staff started getting tapped as PwC walked the halls under plans to remove the 366 members of the firm, with the cuts slated to be completed over the coming nine months.
PwC said all its staff who will lose their roles will be “contacted in the coming days”, with the firm noting they would be invited for new roles which will be advertised internally.
The 366 job cuts come amid earlier rumours of up to 430 losing their roles in the restructure.
Sources indicated the cuts would largely be confined to PwC’s consulting and risk practices, which have suffered in the wake of a last year’s tax leak scandal.
However, others said all practice areas at PwC would see job cuts. In a statement put out by PwC soon after, Mr Burrowes said he would “acknowledge that days like today are especially difficult for those affected”, marking the second time the recent entrant has presided over deep headcount cuts at the firm.
“I can assure you that we will work closely with impacted individuals to ensure they are aware of their options and next steps,” he said. “At its heart, this reorganisation will make the firm a more simplified, efficient and centre-led business, enabling us to continue delivering the highest quality of service to our corporate and private sector clients.”
A PwC spokesman said the job cuts were coming after a review of the firm’s operations, which identified “the need to take proactive steps to reorganise and reshape areas of the firm to ensure it has a simplified, efficient and centre-led structure”.
The firm also announced it would reconfigure its management structure, including adding a chief financial officer and chief information officer.
This comes in the wake of a major review of PwC’s governance structure by corporate veteran Ziggy Switkowski.
Among the casualties of Tuesday’s cuts are understood to be several partners in PwC’s consulting, legal, and risk practices.
Included among them are PwC’s high profile chief economist Jeremy Thorpe, who remained with the firm after the split of its government consulting arm in a $1 deal with Allegro Funds.
This saw PwC’s government consulting business rebranded Scyne Advisory.
But PwC is understood to be pressing on with new partner promotions in July and is expected to embark on a roadshow in the coming months to unveil its new strategy to clients.
The firm is also holding its graduate program open for new starters.
This comes after PwC delayed appointing new partners in October last year, also offering new starters up to $10,000 to push back their start dates by up to 12 months.
The cuts come after PwC faced a pullback from new business after it was revealed last year, PwC’s tax practice misused confidential government briefings to front-run new tax laws in 2016.
Greene Senator Barbara Pocock said she was concerned to see PwC partners and staff lose their jobs “while most of the very highly paid partners who were part of the partnership that saw the tax leaks scandal unfold, to this day, are protected”.
“The PwC leadership has shielded so many Australian and international partners from real consequences,” she said.
“Throughout this scandal, I have heard from so many PwC employees, horrified by what they have learned and witnessed within the firm.”
“They deserve better. They deserve ethical leadership and decent working conditions – and I hope they find them in their post-PwC chapters.”
The cuts will come as the second winnowing of the firm’s headcount, which was slashed to 7200 last year after PwC sold its government consulting arm for $1, and the firm made two rounds of cuts.
PwC slashed almost 350 staff from the firm late last year, with several partners also pushed to early retirement.
The firm closed its Skilled Services Hub in Adelaide in the move, axing 141 jobs as a result.
The firm has moved to force several partners to retire early from the firm in the wake of the scandal.
Most recently, PwC’s chief operating officer Liza Maimone announced she would retire on Tuesday.
Mr Burrowes told partners Ms Maimone would retire on Tuesday, with PwC confirming she would leave after 16 years at the firm. Her role will not be replaced.
However, Ms Maimone will continue with the firm for several months as part of a handover.
She joins several other senior leaders at PwC who have left in recent months. PwC’s long time head of consulting David McKeering gave notice in February he would leave the firm after its horror 2023.
This came after a string of other retirements of senior leaders at the firm in the wake of the tax scandal.
The move to slash headcount comes as PwC finalises the tax obligations for hundreds of partners after the firm trimmed payments to partners in the wake of its revenue collapse last year.
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