Ernst & Young, one of the big four accounting firms in the world, has launched a one-month unpaid leave program in China to reduce labor costs in the economic downturn.
The "leave of absence program" (LAP) encourages all staff members to take up to four weeks of voluntary unpaid leave by June 30. Meanwhile, employees are encouraged not to work overtime during the peak season from January to April.
"The LAP allows us to balance our long-term commitment to develop our people with the short-term need to control costs during the downturn. Over 90 percent of staff has joined the LAP and made leaving plans in advance," said Ernst & Young China's Chairman David Sun.
"We prefer to keep our people together to withstand the crisis rather than making deep job cuts in a knee-jerk decision," said Sun.
It has been reported that Ernst & Young downsized their professional teams in China in November 2008.
"We usually review staff's performance twice a year. Those whose performance is not satisfactory will not get promoted and may consider other career paths. The turnover rate is about five percent every year. We keep the best talent to deliver quality service to our clients," Sun said.
Ernst & Young wants to be the market leader in China by 2011 and has pursued an aggressive expansion plan since 2005.
The company has 9,000 employees in China. It recruited 1,500 people in 2008 and plans to hire 2,000 people in 2009, including 1,500 new graduates.
"China is still one of the most promising markets and Ernst & Young plans to invest more than $300 million in China over four years. In 2008, our revenue in China increased about 30 percent and we are predicting double-digit growth in 2009," Sun said.
The firm has seen strong demand for tax, transaction and risk advisory services, and recently recruited 14 partners to lead the advisory teams and plans to hire more experienced experts this year, Sun said.
"We are also actively preparing for the recovery of initial public offerings and plan to help about 20-30 clients to go public in the overseas market at the end of this year or earlier next year," Sun said.