High Court orders bank to pay bonus

ALLIED IRISH BANKS, which is facing majority state control, will have to pay a €160,000 bonus to an employee of its capital-markets unit after losing a court case.

The lender withheld the payment, due on John Foy’s 2008 performance, since February 2009 after scrapping discretionary bonuses in the wake of the Government guarantee of the country’s financial system the previous September. Edmund Holohan, master of the High Court, ruled against the bank in a summary judgment yesterday.

A lawyer for Foy told the court he is acting “for a number of employees” with similar cases. As many as 90 employees in AIB’s capital markets division have issued similar legal proceedings against AIB in the courts.

An AIB lawyer said the bank was not denying the bonus payment was due and owing. AIB spokeswoman Catherine Burke was not immediately available to comment.

AIB executive chairman David Hodgkinson said on Monday that it’s “highly likely” the Government will own a significant majority stake in AIB following a share sale starting by the end of the month.

The state currently controls an 18.7% stake in AIB.