HSE faces €350m bill for breaking salary agreement with consultants
The Health Service Executive is facing a massive payout of hundreds of millions of euro to compensate hospital consultants for the State's failure to pay them higher salaries agreed eight years ago.
The figure, which was set at €700m in a worst-case scenario, is likely to come to at least €350m.
It follows the decision of the HSE not to appeal a case brought by consultants arising out of the non-payment of part of their salaries.
In January 2015, the Employment Appeals Tribunal ruled in favour of two hospital consultants, anaesthetist Thomas Hogan and endocrinologist John McDermott, who argued that the HSE had breached their 2008 employment contracts.
The tribunal found the non-payment of portions of the doctors' salaries amounted to an unlawful deduction under the Payment of Wages Act.
The HSE has appealed the ruling to the High Court and the appeal was due to go ahead early this year.
However, it is understood the Attorney General advised the HSE to settle the cases.
Previously the HSE had indicated publicly that the cost could be about €350m or even higher when legal bills were added.
However, sources suggested that this represented a net rather than gross figure.
Under the 2008 contract, consultants agreed to major work-practice changes, including the restriction and in some cases the elimination of private practice, weekend working and extended rosters.
In return, then health minister Mary Harney offered them salaries of between €170,000 and €240,000, with increases to bring the rate up to these levels to be paid on a phased basis.
The first payment was made, but not the second, following the collapse in the public finances.
Subsequently the State cut consultants' pay by 15pc.
The Irish Hospital Consultants Association last night confirmed the appeal was withdrawn.
President of the association Tom Ryan said last night however that no offer of repayment has yet been made.
He said it is unclear what the full financial implications will be.
He said as yet the withdrawal of the appeal by the HSE to the High Court only applies to the two doctors who took cases at the Employment Appeals Tribunal.
It is unclear how many doctors would potentially benefit as a number have retired and gone abroad.
"The issue of the recruitment and retention of consultants has to be addressed. There are 350 posts vacant," he warned.
The HSE was unavailable for comment.