He said it was “imperative” that salary costs be cut via the proposed 20 per cent reduction in staff and non-equity partner pay.

“It is therefore imperative that our salary costs are reduced immediately, otherwise our equity partners, based on the modelling we have done, could see their earnings halved,” he told partners.

Equity partners are expecting a cut to pay of at least 25 per cent for the year.

The first Zoom partner-only meeting, which ran for more than 40 minutes, reached its 500 participant capacity within two minutes. An all-staff broadcast was done at 4pm that day.

"These measures are designed to protect jobs, safeguard the overall health of the business, with our primary concern the wellbeing of all our employees and partners,” said Deloitte CEO Richard Deutsch.

The firm's partners are equally split between salaried non-equity partners and equity-owning partners who share in the profits of the firm. There are about 10,000 staff at the firm.

The staff pay cut, like the approach of rival KPMG, will not involve a commensurate cut to working hours, but no employee will have their salary fall below $65,000 a year.


The firm will also give every staff member an additional 10 days of leave to be used by the end of January.

Deloitte staff have been given until Monday afternoon to opt-out of the cut but the firm has not specified what will happen if too many staff members refuse to take the cut.

At KPMG, which has already cut 200 staff, employees were told that modelling by the firm requires all staff to take the pay reduction or more job cuts may be required.

Mr Griffiths said the level of utilisation of staff at the firm, a measure used in professional services firms to measure billable hours out of total working hours, was tracking lower in every division except for audit and assurance.

The firm’s overall utilisation rate dropped from about 71 per cent in the last week of March to about 66 per cent in the first two weeks of April. This was against a planned rate of 72 per cent.

Audit and assurance was a bright spot for the firm, with “strong utilisation” of 78 per cent, a rate the division expected to hold. This is due to clients still having to employ auditors to look over their financial books regardless of the economic environment.

Mr Griffiths said the consulting division expected utilisation to drop to 60 per cent in May.


This meant that, as of April, about one in three consulting staff at the firm had no client work to do while the firm was still paying their salary.

Mr Griffiths said the utilisation had dropped to as low as 61 per cent across the firm’s financial services, risk advisory and tax divisions. The firm expected utilisation to continue dropping in May.

He noted that partners had done a good job of billing clients and implored them again to ensure they were quickly invoicing clients.

“Please, please, please partners, bill now. We need another billing month like March if we are to continue [the upward cash flow trend].”