1. Non-bankers are livid that "bonuses" are to be paid to employees of organisations that are losing money
2. Bankers or other city types point out that most employees of these banks are expecting a bonus as part of their remuniation package, as they were not responsible for the spectacular failings of the investment arms of their banks.
These two perspectives are not incompatible! Let me explain. Aside from executive level, all bank staff will be paid a basic salary. For anyone working directly for the bank, this salary will be quite acceptable, thank-you very much. Even PAs and basic IT support admins will be on 40k or more.
Then, as part of their contract, there will be a bonus eligibility, which will be expressed as a percentage. This may be 10-20% or so, the exact number relating to their position, what was negotiated as part of their contract etc.
Each year, a corporate performance reward scheme will be put in place. This will set out how much of the of this agreed % will relate to personal target achievement, how much will relate to corporate success, and there may be other factors in the mix too.
So if we take 10% as bonus potential, it may be that 6% is personal, 3% corporate and 1% if the bank achieves some specific goal. Thus if the employee completes all of his objectives for the year, agreed at the beginning and reviewed at the end, he will get that 6%. If the company makes large profits, he will get the 3%, and the 1% will come if the bank breaks into the new target market, or opens a certain number of new branches.
The huge fuss in the media focusses purely on employees getting "bonuses". What all will agree, I suspect, is that the corporate part (the 4% in my example) of their bonus should not be paid. Individually though, they still deserve the portion of their "bonus" associated with delivering on their personal objectives (or not as the case may be!). Indeed contractually I suspect one could not not pay this part of their package.
Yet another example of the media blowing a story out of proportion to sell more print. Does it help us as a society though? Probably not.