The Irish Times has reported AIB staff are set to receive a 3.0% pay increase under new proposals with pay unions.

The average increase is set to apply to c.80% of employees across the bottom three staff levels covered by the collective bargaining agreement, with a portion performance-related and the balance fixed to cost of living.

The details emerged after the bank and unions had the proposals considered by the Workplace Relations Commission and union members will now be balloted on the proposals. The 3.0% rate is a slight increase on the prior 2.75% arrangement in place for the past 2 years.

With c.80% of staff potentially qualifying for this figure plus there is a performance component, Goodbody Stockbrokers believe the actual wage inflation rate will average c.2.75%, up from the estimated average 2.5% figure they have built into their models.

Accoding to Goodbody Stockbrokers, "This 25bps drift will add c.€3m to our FY20f wage bill compared with our €1.07bn pretax profit estimate, so whilst not zero, it is a small 0.3% impact, plus it is helpful the new agreement is in place as the new CEO takes the reins in the next few months."

Source: www.businessworld.ie