Kenneth Feinberg 'to lift AIG salary cap'

8 December 2009

Government pay czar Kenneth Feinberg is willing to reverse his $500,000-a-year salary cap for some of the top executives at American International Group (AIG), according to company insiders.

Late last week, five high-ranking AIG employees threatened to quit the company in protest at potential cuts to their salaries.

Mr Feinberg is set to issue a ruling on pay for its top 75 highest earners next week, reports Bloomberg.

While the salary cap has applied to everyone at AIG with the exception of chief executive officer Robert Benmosche, who receives $7 million a year, it is believed that Mr Feinberg may be prepared to relax the remuneration restrictions currently in place.

More than 50 managers have left the firm since the bailout and Mr Benmosche and the AIG board have warned the government that the salary cap is making it uncompetitive.

Last month, Mr Benmosche himself threatened to leave the firm if he was not allowed to pay his executives more.

By Tony Aynsley

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