ICC Bank employees are to vote on a new share option scheme that will give them a 14.9 per cent stake in the State-owned bank. This is conservatively estimated as being worth £100,000 (€126,974) for each employee. The employee share option scheme (ESOP) will go ahead whether the bank is privatised or not, but will be worth much more if the sale goes ahead.

In return for the ESOP deal staff are being asked to accept significant changes in work practices to make it a more attractive proposition to potential buyers. The most radical changes are an extension of the working week from 32.5 hours to 36.5 hours, which is the norm for most banks and staff are also being asked to make a 5 per cent contribution from salaries to the pension fund. This is currently non-contributory.

Last year an attempt to sell ICC failed because of a lack of interest by financial institutions. Only Bank of Ireland expressed interest in acquiring it.

Although the total value of the ESOP is being put at £29.8 million, staff will only have to raise £4 million. Some 5 per cent of the company is being given to the employees in return for a transformation agreement on more flexible work practices. The remaining 9.9 per cent, valued at £19.8 million, will be funded by a variety of means.

According to figures in Industrial Relations News the value of the pension fund contributions is being put at £6.5 million, the longer working week at £2.8 million and most of the remaining cost will be met from funds generated from a new profit sharing scheme. Staff will use their 5 per cent share of profits to service a £4 million loan.

MSF union official Mr Brian Gallagher said: "We think the deal is better than the one we negotiated last year when the sale of ICC fell through." A major new element is to bring forward payment of the first 5.5 per cent phase of the Programme for Prosperity and Fairness to October 1st. It is not due until next April.

While the ESOP is not dependent on an ICC sell-off, Mr Gallagher said the thinking behind it is to give staff an incentive to make ICC a more efficient and profitable organisation. Even if profit margins do not rise, he estimated it should be possible for staff to finance their stakeholding through extra income flow that will arise from the ESOP.

Balloting on the ESOP package will begin shortly. It is expected to conclude within the next three weeks.