KPMG and Deloitte offer enhanced redundancy packages to cut UK headcount

Big Four giants offer redundancy packages that go beyond the legal minimums

KPMG and Deloitte are offering UK staff bumper redundancy packages as they look to reduce headcount and cut costs, City AM can reveal.

The two accountancy firms, along with PwC, have all increased payouts to employees following a slowdown in the sector’s traditional "attrition model," where around 15–20 per cent of staff typically leave each year. A tight jobs market has resulted in far fewer staff departing voluntarily.

All three firms have been forced to lay off staff this year. Between KPMG, Deloitte, and most recently PwC, approximately 600 audit middle-tier jobs have been on the chopping block so far in 2025.

KPMG Ditches Statutory Cap

In March, it was revealed that KPMG UK planned to cut over 500 staff across its auditing and advisory divisions, including roughly 440 assistant manager roles in the audit business and 120 roles in advisory.

Staff affected were informed of the redundancy consultation that same month, and those who signed the settlement have since left the firm.

According to an internal memo seen by City AM, KPMG stated that all affected employees would receive a minimum of eight weeks’ basic salary, including any statutory redundancy pay (SRP).

Under English employment law, employees must have at least two years of continuous employment to qualify for SRP, but the firm waived this requirement.

The law also calculates SRP using a strict formula based on age and length of service. The government caps "a week’s pay" for this calculation, currently set at £751. However, KPMG removed the £751 statutory cap and calculated the payout based on the employee’s actual weekly salary.

The package KPMG staff received also included payment in lieu of notice or garden leave where applicable, but it stated that employees would not be eligible for any full-year 2026 bonus.

Clare Brennan, employment partner at Hunters Law, explained: "In practice, enhanced redundancy payments are often offered in conjunction with a settlement agreement, giving employees an incentive to waive potential claims in return for a payment that is usually significantly higher than their statutory redundancy entitlement."

However, according to a close KPMG source, some staff who had been at the firm for over eight years were unhappy with the offer because junior staff were receiving packages similar to those of more senior, long-serving employees.

Deloitte Dangled Eight-Month Payouts

Deloitte was revealed in June to be laying off nearly 200 audit roles as part of a voluntary redundancy round.

It was understood at the time that as many as 175 auditors, including managers and assistant managers, would be on the chopping block, representing less than three per cent of its audit and assurance business and less than one per cent of the UK firm.

Under English law, accepting voluntary redundancy is still legally classed as a dismissal. Therefore, the baseline legal rules governing a voluntary package are based on the same statutory minimums as those for compulsory redundancies, though employers usually offer enhanced terms to incentivise staff to leave.

It is understood that Deloitte put a highly generous package on the table, including eight months of full pay.

City AM understands that those who wanted to accept the package had to do so by 10 July, and that if they accepted, they would leave the firm by the end of the month.

Deloitte is not the only firm to have offered a voluntary redundancy round. City AM revealed last week that PwC reduced its audit division through a "small number of targeted voluntary exits."

KPMG and Deloitte were approached for comment.