Sales credits fuel bonus ire

The former head of Italian sales at Nomura is taking the bank to court over the alleged misallocation of sales credits at the bank. With the size of the bonus pot likely to be bigger than ever this year, one headhunter says similar disputes are likely.

"Business growth, with larger transactions and therefore larger bonus expectations, means this is becoming more of an issue," says Lee Thacker, partner in the financial services team at search firm Highland Partners. "Banks try to allocate credit fairly, but it comes down to lobbying and politics. This is certainly a management issue for sales and trading."

In the case of Nomura, it would seem to be a legal issue too. The Japanese bank, which is already fighting bonuses-related cases on several fronts, faces a 3m claim from Piero Burragato, its former head of Italian sales.

Burragato resigned in July after receiving a 53,000 bonus instead of the 2m payout he was expecting. According to his lawyers, he attributes the shortfall in part to the way sales credits were allocated.

Justin Murray, of law firm Ferguson Solicitors, is representing Burragoto. He tells us banks can avoid similar cases by making their system of credit allocation clearer. "The key thing is transparency, so that employees can see where P&L is being allocated, and if it's being fairly allocated to the proper individuals who have done the work."