It is becoming too expensive to make senior bankers redundant

One reason senior civil servants have always enjoyed immunity to redundancy is their enormous pay offs.

In the good old days, civil servants could get anything from three to six years' salary if their career was curtailed inopportunely. Because of this, their careers were never curtailed inopportunely and there are lots of them.

Senior bankers are not as expensive to dispense with, but they are expensive. And heavily deferred bonuses are making them more expensive still.

In most cases of redundancy, the individual being evicted is permitted to cash in all deferred bonus payments immediately. "Unless there's been an incidence of gross negligence or misconduct good leavers [anyone not joining a competitor] are usually allowed to take the deferred element with them," says Ronnie Fox at Fox Lawyers.

Now that anything from 40-60% of previous years' bonuses are being deferred, this can be costly, particularly when the deferrals are in cash. It can also make redundancy strangely appealing.

The head of the markets division at one international headhunting firm, says clients are increasingly asking him to 'reverse headhunt' people rather than making them redundant.

"Clients often ask if I can find one of their people an alternative role elsewhere," he says. "The client doesn't want to make them redundant because they don't want to pay, but they know that if the individual leaves voluntarily for a rival he'll have to give up his deferred bonus and it will be far less costly.

"Reverse headhunting is often difficult to pull off," he muses. "If someone's rubbish, no one wants them. The danger is that they'll just stay on the books forever."