PwC asks staff to take unpaid leave to cut costs: Here’s how you can do it too

Accounting giant PricewaterhouseCoopers has asked 5000 full-time staff to take up to three weeks of unpaid leave in an attempt to save costs.

Chief executive Mark Johnson said in an email to staff that the requests are a “temporary initiative to respond to temporary times”, and that redundancies are a last resort.

“We are comfortable with our staff levels in the medium to long term, but we need to manage our costs,” he told The Australian Financial Review.

“We see lots of upside – it’s a responsible way to deal with cost reduction and keeps our workforce intact to deal with a pick up…we have a very skillful workforce and our ambition is to keep them for the upturn.”

The firm says it will not ask its 483 partners to take unpaid leave. Staff working in insolvency and restructuring areas are also immune due to increased workloads.

Principal of CCI Victoria Legal Peter Vitale says that employers wanting to ask staff to take unpaid leave must be careful not to breach contract obligations.

“Any employer that wants to implement measures of this nature should ensure the terms are very clearly documented and agreed with employees,” he says.

“There’s no mechanism of the law for people to take unpaid leave unless there are circumstances in which a stand-down is permitted under the Workplace Relations act. Basically, ongoing economic difficulty doesn’t meet that test,” he says.

“Basically it’s that you’re asking people to vary their contract of employment. So if the business sees that as a viable way of saving costs and the employee is agreeable, then legally there’s no problem with it.”

Vitale also says that asking staff to take unpaid leave may be a better outcome for both parties than shifting to a nine-day fortnight.

“If you think about 10 to 15 days of unpaid leave as opposed to the concept of a nine-day fortnight, which would end up being about 26 days for the year, in a sense it’s a comparable proposal.”

Related stories:

• Companies look to force staff to take unpaid leave – here’s how to do it
• My employee has no work. Is unpaid leave an option?