EY apologises for workplace culture following Senate grilling

***UPDATED****

EY has apologised for its workplace culture which, a review last year found was negatively impacting staff and pushing many to consider quitting.

Last year, the firm engaged Elizabeth Broderick & Co to review its workplace culture. Its final report identified a range of troubling behaviours, with a special emphasis on a culture that incentivised excessive working hours.

It was the most comprehensive review of workplace culture ever conducted in the Australian professional services industry, according to EY, which accepted all recommendations made by the review.

In answer to questions on notice from a Senate consulting inquiry, Leigh Walker, EY Oceania risk and independence leader, apologised that the working experience at the firm is not always positive.

“The report findings highlighted that a significant majority of our people have a positive experience at EY. However, this is not the experience for everyone, and for that, we are sincerely sorry,” said Walker.

The Broderick review found that nearly one-third of EY staff routinely work 51 or more hours per week and that 61-hour weeks are the norm for around one in 10.

A further 46 per cent of the firm’s personnel said they had suffered negative impacts as a result of the long working hours, while 42 per cent had considered resigning because of the long working hours.

The review was commissioned after EY’s senior auditor Aishwarya Venkatachalam was found dead in the firm’s Sydney office. The event raised serious questions about the workplace culture of the firm and professional services more broadly.

Fronting the Senate last November, Broderick said a perceived culture of overwork was a “very strong theme” in the surveys and one-on-one interviews conducted as part of the review.

A majority of surveyed staff told the Broderick review that they believed EY had the power to enact meaningful change on issues including bullying, sexual harassment, and racism.

However, comparatively few believed the overwork culture was something that could be readily addressed.

Broderick said the overwork problem affects the entire professional services industry, not just the visible case of EY.

“I think most professional services firms would have these types of long working hours. Part of that is the way the whole system operates – it’s time billing,” she said.

“The model is you are selling time. Not only that, but a lot of roles and assignments that professional services firms get asked for are highly complex.”

Overwork may be more prevalent in professional services, but it exists well beyond the industry.

Last November, a SuperFriend survey found that 59 per cent of Australian employees believed their workloads were inappropriate. It also found that job performance correlated negatively with heightened workloads.

Broderick said working excessive hours was a social norm in Australia, one that portrays the ideal worker as “someone always available 24/7.”

In professional services, however, there is often an additional layer of pressure where working hard is not just an expected part of the job, it’s a selling point.

“As one of the interlocutors said to us in our review, ‘I didn’t sign up for easy,’ and I think anyone who goes to a professional services firm would say that,” said Broderick.

“In professional services, we’re selling time and people are rewarded according to that, so I do think it is an exacerbator of long working hours culture.”

Both the Broderick review and PwC’s Switkowski review found that negative cultures can emerge where employees lack the “psychological safety” to speak up.

“[Switkowski] pointed to a number of areas where, if people had felt safe to speak out, some of these issues might not have ended up where they did,” said Broderick.

“We saw a similar issue at EY, particularly where people weren’t speaking up about sexual harassment or racism or, indeed, most importantly the long-working-hours culture.”

Recently, Federal Parliament cleared the ‘right to disconnect’ bill, which will give employees an enforceable, qualified right to switch off from work-related communications outside of work hours.

In workplaces where employees are afraid to speak up about overwork, it is difficult to imagine many staff will invoke their right to disconnect.

Recently, however, Jamie MacLennan, senior vice president and managing director APAC at TELUS Health told Accounting Times that focusing on whether employees will enforce the right misses the point.

The right to disconnect reform revived a conversation about work/life balance, the same conversation that the Broderick review contributed to.

EY said it has implemented a “time-owed-in-lieu pilot” and is “making strong progress” on other recommendations made by the review.

"We know that long working hours are a critical issue for professional services firms, and that the impact of that is not experienced equally. The use of time-off-in-lieu is not new to many parts of the EY business, such as Assurance. However, we are now running pilot programs with other service lines - as part of the recommendations coming from the Elizabeth Broderick & Co Report - to explore new ways to help our people create sustainable ways of working," said Kate Hillman, EY Oceania people, place, and culture leader.

"Beyond tools like time-off-in-lieu, we are most interested in addressing the root cause of long working hours and finding solutions that secure our people’s wellbeing. Over the past year we have seen encouraging signs that experimental pilots in how we structure work, AI and automation technology, and our approach to scoping and resourcing projects are having a positive impact. And we will look to scale the successful experiments into other parts of the business."