Coronavirus: EY defers partner promotions amid pandemic
EY has told partnership candidates that promotions will be delayed until October, Sky News learns.
Wednesday 13 May 2020 16:56, UK
EY, the big four accountancy firm, is delaying partner promotions by three months as part of a response to the coronavirus pandemic which has seen it commit to retaining its entire 17,000-strong UK workforce.
Sky News understands that EY told partnership candidates this week that their potential elevation would not take place as planned in July, but would be deferred until early October.
The decision is understood to have been made in alignment with its global firm, and is the latest in a series of measures taken by the big beasts of the accountancy profession as they grapple with COVID-19's financial impact on some areas of their business.
EY, which is also preparing for a change at the top of its firm in the UK and Ireland, said in mid-April that it "would continue with a number of critical internal promotions to partner as usual in July".
That position is understood to have been superseded in recent days with the notification to prospective equity partners and associate partners.
They are also said to have been informed that fewer people than originally anticipated would reach the partnership this year.
In 2019, EY promoted 57 people to partner status.
The disclosure comes four weeks after the firm vowed that it would make no redundancies, would not use the government-subsidised furloughing scheme and would retain employees on their current salaries - although partner profit distributions will be cut by 20% to save money.
EY also said that it would press ahead with its annual apprenticeship and internship programmes.
The firm has been drafted in to advise the government on its 'return to work' strategy - a key plank of helping the UK economy back to its feet.
Like other members of the big four, however, it faces a challenging period across parts of its business such as transaction services.
Rival KPMG has told partners that they face pay cuts worth hundreds of thousands of pounds as it seeks to conserve cash.
PwC has said it would delay partner promotions and bonuses, while Sky News revealed last week that Deloitte was consulting on reducing the contributions it makes to UK-based employees' pension pots.
EY declined to comment.