St George Bank settles staff bonus conflict
(11 April 2012 – Australia) St George Bank agreed to pay seven former staff the "retention incentive bonus" promised to key staff nearly four years ago.
More than 100 former staffers of St George could be eligible for the cash bonanza with the legal backdown by the bank in the Federal Court that could cost it more than A$3 million.
The bonuses were promised by then-St George chief executive Paul Fegan on 18 June, 2008, and were aimed at keeping the senior executives at the bank during the group's merger with Westpac.
Many of the staff were currency traders and money market dealers who were in high demand at rival banks.
If the staff agreed to stay at the bank during the merger, and the bank achieved its earnings per share growth target in 2007-08, they would be paid a bonus.
The bonus was worth between A$30,000 and A$50,000 each and was equal to 25 percent of their bonus the previous year. The staff believed the target was between 8 and 10 percent earnings per share growth, and the bank achieved 8.3 percent in October 2008.
But the target was changed to 10.1 percent without staff knowledge, the court heard.
The bank yesterday agreed in court to pay the seven former executives.
The legal backdown comes two years after a group of staff sued the bank over the bonus and redundancy payouts.
Those to settle last week, include St George's former head of group tax Lucky Poulos, former St George foreign exchange trading manager Stuart Moore and former manager of institutional fixed-income sales Danielle Lavars.
The bonuses were promised by then-St George chief executive Paul Fegan on 18 June, 2008, and were aimed at keeping the senior executives at the bank during the group's merger with Westpac.
Many of the staff were currency traders and money market dealers who were in high demand at rival banks.
If the staff agreed to stay at the bank during the merger, and the bank achieved its earnings per share growth target in 2007-08, they would be paid a bonus.
The bonus was worth between A$30,000 and A$50,000 each and was equal to 25 percent of their bonus the previous year. The staff believed the target was between 8 and 10 percent earnings per share growth, and the bank achieved 8.3 percent in October 2008.
But the target was changed to 10.1 percent without staff knowledge, the court heard.
The bank yesterday agreed in court to pay the seven former executives.
The legal backdown comes two years after a group of staff sued the bank over the bonus and redundancy payouts.
Those to settle last week, include St George's former head of group tax Lucky Poulos, former St George foreign exchange trading manager Stuart Moore and former manager of institutional fixed-income sales Danielle Lavars.
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