Ernst & Young sacks half US in-house team

INTERNATIONAL chartered accountancy firm Ernst & Young has surprised the legal world by slashing its US in-house department by more than one half.

Thirty-seven of the firm's 65 lawyers were called in on the 10 October Columbus Day holiday and dismissed.

The firm's national director of public communications, Mort Meyerson, says although staff had no notice of the retrenchments, they received "generous" severance packages, including between six and 12 months' pay, "outplacement counselling" and the use of offices.

He denies claims that the lawyers were met by uniformed guards and told to empty their desks and leave immediately.

Meyerson says the decision to scale down the team was reached because Ernst & Young had a legal department more than double the size of competitors.

"We had the largest staff of in-house lawyers among the Big Six. We made the change because it made sense in the past to have a large in-house staff, but now it seems law firms are more responsive to cost-effective, value-added legal services," he says.

Meyerson says Ernst & Young, which carried out most of the dismissals in its New York office, also let go more than 200 other staff.

"This is not the significant move it may appear to be," he says.

A spokeswoman for Ernst & Young in the UK says the firm has no plans to dismiss lawyers in its offices here.