Commerzbank ordered to honour bonus promised to 104 bankers | Irish Sun

Commerzbank ordered to honour bonus promised to 104 bankers

Irish Sun Wednesday 9th May, 2012

• The unpaid bonus totaling 42mn pounds was promised four years back

• Judge said Commerzbank had breached its legal duties by failing to honour the payouts

• The bonus for 2008 calendar year was to have been paid from the guaranteed minimum bonus pool

LONDON - A High Court judge has ruled that over 100 ex-London employees of Dresdner Kleinwort, now owned by Germany's second largest bank Commerzbank, were entitled to claim unpaid bonuses totaling 42 million pounds even though the bank had made huge losses.

In his ruling Wednesday, High Court judge Robert Owen said that the 104 former employees of Dresdner Kleinwort should be paid the bonus promised to them four years ago.

The judge said the bank had breached its legal duties by failing to honour the payouts, which came from a guaranteed annual bonus pool in 2008, calling them "binding and enforceable contractual promises".

Commerzbank, which has twice been bailed out by German taxpayers, had argued that it is now integrated into the Dresdner Kleinwort investment banking subsidiary and as such was obliged to slash 2008 bonuses because of its huge losses.

Lawyers for the bankers said the case hinged simply on a brazen attempt by an employer to break promises made to staff, who had been persuaded to remain loyal to the bank in uncertain times with the promise of financial reward.

They said the pool was created in August 2008 in order to retain staff and was formally communicated to them by Dr Stefan Jentzsch, then chief executive of Dresdner Kleinwort Investment Bank.

Page 1 of 3 | Next