Saturday 17 March 2018

Ex boss of PTSB in bid for €866,000 severance

David Guinane, former chief executive of Permanent TSB
David Guinane, former chief executive of Permanent TSB

Tim Healy

FORMER Permanent TSB chief executive David Guinane claims he is entitled to a severance payment of over €866,000 following his departure from the bank in 2012.

In a High Court action, Mr Guinane, who worked for PTSB for more than 25 years, made several claims against the bank, including that it is in breach of contract, and that it denied him fair procedures during his departure. He also claims he has a contractual right to a payment under the bank's severance scheme known as Voluntary Severance Scheme (VSS).

He further claims his reputation was damaged by his former employer, that the bank was in breach of its duty towards him, and was negligent.

State-owned PTSB denies the claims and said Mr Guinane received what he was entitled to when he was made redundant.

Opening the case yesterday, Paul Anthony McDermot SC, for Mr Guinane, said his client was chief executive of PTSB when it was part of Irish Life & Permanent Group.

After the group was recapitalised by the State with €4bn (€3.7bn) in 2011 the banking section was separated from Irish Life as part of the restructuring of the organisation.

As part of the restructuring, all senior positions in the banking entity were advertised.

Counsel said this was a process where Mr Guinane, who had always been highly professional and a dedicated employee, had been left humiliated.

Many others in the organisation knew the position had been advertised before Mr Guinane did, counsel said.

Mr Guinane applied for the role of chief executive in the new bank, and went through two interviews, the second of which counsel said was "an illusion".

The position was given to English banker Jeremy Masding in January 2012. Counsel said Guinane "found out by accident" he had not got the job.

Due to his departure from the bank, Mr Guinane said he was entitled, like other senior employees at PTSB, to a payment under the VSS. This entitlement was "the key issue" in the case, counsel said.

Counsel said payments under the VSS were based on the person's salary and the number of years they worked at the bank.

In Mr Guinane's case the payment he said he is due has been estimated at €866,000.

However, his client was offered a payment of €175,000 plus 11.5 months salary by the bank, which he refused.

Counsel said he was told that due to re-capitalisation the Finance Minister had capped severance payments to senior staff. Counsel said that while Mr Guinane was told that any severance payment would have to be approved by the Minister it had appeared from the discovery of documents that the Minister was never asked about any payment to his client.

The bank denies Mr Guinane is entitled to a payment under the VSS after he was made redundant.

The case before Ms Justice Leonie Reynolds continues.

Irish Independent

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