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PwC has told 40,000 staff in the US that they can work remotely from anywhere in the country but risk a pay cut if they move to locations with a lower cost of living.

The decision to allow staff to work remotely on a permanent basis is the most radical response from a Big Four firm to the changes wrought by the Covid-19 pandemic.

Under the plan, client-facing employees will be allowed to opt in to “virtual” roles, working from home except when they are occasionally needed in an office for team meetings, client visits or other key events, PwC said.

Staff who choose to work remotely would be required to come to the office no more than three days a month, Yolanda Seals-Coffield, PwC’s deputy US people leader, told Reuters, which first reported the move.

Cutting the pay of employees who move to cheaper locations mirrors the approach taken by tech companies such as Facebook, Twitter and Google.

PwC said it was the first professional services firm in the US to allow employees to work remotely from any part of the country.

The decision to allow professionals to work primarily from home on a long-term basis is likely to force competitors, including Big Four rivals Deloitte, EY and KPMG, to consider whether they will need to do the same in order to retain staff.

“We have learned a ton through the pandemic, and working virtually, as we think about the evolution of flexibility, is a natural next step,” said Seals-Coffield.

“If you are an employee in good standing, are in client services, and want to work virtually, you can, full stop,” she said.

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PwC expects 30 to 35 per cent of eligible staff to opt in to permanent remote working. Partners managing staff who come to the office regularly will not be allowed to work completely remotely.

The policy does not cover PwC’s 15,000 back-office staff, including functions such as human resources and IT support, most of whom are already able to work remotely.

PwC has left the door open to reversing the policy if permanent remote working is not a success. “While these are not short-term moves and are intended to be ongoing options for our people, we will continue to evaluate and innovate — as we do with all of our policies, benefits and flexibility,” it said.