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 last year 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The HSE appealed the ruling to the High Court and it was due to go ahead early this year but it has now been withdrawn.
However, it is understood the Attorney General advised the HSE to settle these 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, the then minister for health 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 15 pc.
The Irish Hospital Consultants Association confirmed the appeal was withdrawn and said it welcomed the development.
The HSE was unavailable for comment.