Department of Finance had 'no objection' to bonuses for call centre staff at AIB

THE DEPARTMENT of Finance approved bonus payments to call centre staff at Allied Irish Banks, which is now almost fully nationalised, for the first half of 2009, according to correspondence seen by The Irish Times.

The department said in a letter to AIB in June 2009 that it had “no objection” to the payments being made under the direct banking bonus scheme for staff in the bank’s 24-hour banking division.

“It is noted that arrangements have been put in place to ensure that relevant payments under the scheme are reflected in the appropriate payroll,” wrote Alan Zambra in the department’s financial services division to AIB general manager Philip Brennan.

The bank declined to comment.

Part of the payments are reflected in a payment of €2.4 million disclosed by the department in response to a parliamentary question last December.

Some of the payments due to staff at the bank’s call centres in Swords, Naas and Belfast were withheld following a decision by the Minister for Finance to write to the bank making the non-payment of bonuses a condition of any future State funding of the bank.

However, bonuses for the first half of 2009 were paid to call centre staff who receive part of their pay, estimated at about €1,000 each, based on the number of customer calls they handle.

The bonuses appeared as salary payments in the payslips of the staff but fall under the bank’s direct banking bonus scheme and are regarded as “salary at risk” covering performance on the handling of AIB customer calls.

Internal records show that the department approved payment of 2008 pre-existing contractual bonuses to staff outside Ireland.

The bank approved payment of bonuses to call centre staff in Naas and at First Trust in Northern Ireland, as well as well Polish staff at AIB’s Polish subsidiary and staff covered by the bank’s allied Irish-America bonus scheme.

The department wrote to the bank in November 2009 saying that the Minister, Brian Lenihan, would consider the payment of similar bonuses to staff in Ireland based on applications from AIB but not to senior executives.

In July 2009, the department noted that the bank had a legal obligation to pay performance-related bonuses to AIB capital markets staff for 2008 and said it had no role in approving the bonuses.

Mr Lenihan later blocked the bonuses, making their non-payment a condition of further State funding to AIB, which has received €7.2 billion from the government.