KPMG Ends Overtime Pay for UK Junior Auditors Amid Cost Management and Workflow Shift

Global accounting giant KPMG has discontinued its overtime pay scheme for junior auditors in the UK, a move that has reportedly caused significant discontent among staff and highlighted the financial pressures within the audit profession. The change affects junior employees who previously qualified for extra compensation during the traditionally demanding 'busy season.'

The policy change abolishes the firm's previous "recharges" system. Under this scheme, junior auditors were eligible for additional compensation when their weekly workload surpassed 50 hours. Given that many staff could often work in excess of 70 hours a week during peak periods, these payments served as a crucial source of supplementary income.

The extra compensation, often amounting to between £1,000 and £2,000 annually for junior auditors, was a significant incentive, particularly given the profession’s demanding hours. The sudden removal of this pay has unsettled employees who relied on the expected top-up to their earnings. One junior auditor noted that the decision makes it difficult for staff to feel incentivised to remain with the firm long-term.

KPMG Justifies Move with Efficiency Drive

KPMG is reportedly implementing the change as part of a dual strategy: to manage costs and, ostensibly, to reduce the need for excessive overtime. Sources indicate that the firm is aiming for a fundamental shift in its audit workflow.

The firm has drastically front-loaded its auditing process, with approximately 70% of the audit work for major listed clients now scheduled to be completed before the traditional peak period begins. This represents a substantial increase from just 45% two years prior and is intended to significantly limit the necessity for protracted "busy season" hours. The company believes its current staffing levels are sufficient to handle peak demands without requiring junior staff to work excessive, compensable hours.

Growing Disparity in Earnings

The policy adjustment comes while a stark difference in earnings persists between junior staff and the firm's leadership.

Role	Salary/Remuneration (Last Year)
Junior Auditor (London Graduate Starter)	£32,500
Average UK Partner Remuneration	£816,000 (Following a 9% increase)

Critics note the irony of cutting a vital pay mechanism for the lowest-paid staff while partner profits continue to rise. This growing pay disparity is likely to fuel ongoing debates regarding staff retention and workload management across the Big Four firms, particularly in the high-stakes sectors of audit and tax compliance. KPMG has yet to issue a public statement regarding the change in its overtime policy.

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