Get ready for some more noise. According to The Washington Post American International Group plans Wednesday to pay another round of employee bonuses worth about $100 million, a year after similar payments at the bailed-out insurance giant infuriated many Americans and inflamed Washington.
“My clients are looking forward to getting paid their contractual entitlements.”
American International Group plans Wednesday to pay another round of employee bonuses worth about $100 million, said several people familiar with the matter, The Washington Post reports.
This week’s retention payments will go only to employees at the company‘s Financial Products division who agreed recently to accept 10 to 20 percent less money than AIG had initially promised them years ago. In return, they are receiving their payments more than a month ahead of schedule.
The company is still scheduled to pay out tens of millions of dollars more in March, mostly to former employees who did not agree to the concessions.
AIG executives have been scrambling to hammer out a compromise before March 15, when the firm faces a deadline to pay nearly $200 million in bonuses to employees at Financial Products, the unit whose risky derivatives deals brought the insurer to the brink of collapse in 2008. Government and AIG officials have been eager to avoid a repeat of the public furor that erupted last March when an earlier round of payments — worth $168 million — went to the same set of employees.
People familiar with the negotiations said about 97 percent of current employees at Financial Products division agreed last week to forgo 10 percent of their upcoming bonus in return for early payment. Participation rates have remained far lower — about 35 percent, two people said — among former employees, who were asked to surrender 20 percent of their bonuses.
Andrew Goodstadt, a New York lawyer who represents more than a dozen current and former Financial Products employees, said he hoped the deal would be a step toward normalcy. “My clients are looking forward to getting paid their contractual entitlements,” he said, “and resolving this matter once and for all.”
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