Belfast Telegraph

Bid to block AIB bonuses 'too late'

Controversial bonuses could end up being given to some 90 Allied Irish Banks staff despite Government attempts to block the pay-outs, it has been suggested.

The Labour Party said the workers have taken court action over the money and questioned whether the Government could legally intervene.

AIB withdrew 40 million euro of bonuses to 1,460 executives after Finance Minister Brian Lenihan wrote to bank bosses threatening to hold back state support.

But the Labour Party cited a court case from 1950 where the Oireachtas was barred from stepping in where proceedings have begun.

Leader Eamon Gilmore said: "If that's the case then we're in territory that the minister sent his letter, but bonuses will still end up having to be paid. Are we in a situation that the minister is shutting the door after the bonuses have bolted?"

He said the Government was shamed into sending the letter.

Taoiseach Brian Cowen confirmed 91 staff have taken legal action, with the Government unable to stop payment to trader John Foy, who won the initial challenge.

But he added: "The others, while maybe in process, have not been paid as yet as I understand it and therefore it would be important for us to deal with this matter as expeditiously as possible to provide as much legal justification as possible for the decision that we are seeking to have effected."

The Credit Institutions Bill, due to be debated in the Dail on Wednesday, will underpin Mr Lenihan's pledge that much-needed money will only be given to Allied Irish Banks if the controversial 40 million euro bankers' bonuses to workers are scrapped. It is understood Mr Lenihan consulted with the Taoiseach and the Attorney General, who backed the move, at the weekend.

The High Court last month ordered AIB to pay backdated bonuses to selected staff after the bank failed to enter a defence against a case taken by Mr Foy. AIB said it had received strong legal advice that it was obliged to pay these bonuses.


From Belfast Telegraph