The recommendation ruling followed a pay claim brought by trade union Siptu against three local job initiative schemes, which had argued that they were unable to pay benchmarking because Fas had not supplied the funds.

The ruling is the latest in a series of findings made against the agency and the community organisations that operate its programmes arising from a government decision to block staff running Fas programmes from receiving the payments.

Although most Fas employees received salary increases as a result of the controversial programme, the Department of Enterprise, Trade and Employment decided that, because staff employed by community bodies on Fas activities were not directly employed by Fas, they shouldn't receive the payments.

Sources have indicated that the latest ruling, which affects around 80 team leaders, will cost the agency several hundred thousand euro a year, as well as significant amounts in back payments to each worker involved.

"The problem is Fas was not given funding for benchmarking for these programmes because the money has to be approved by the Department of Finance, " said a source.

"Since then, these payments have come into effect on a programme-by-programme basis as they have been kickstarted by Labour Court recommendations."

A spokesman for Fas said the agency had noted the recommendation but that it had to receive sanction from the department before it could allocate benchmarking payments.

"We will review the job initiative programme payments with the department in light of the recommendation, " he said.

Meanwhile, a spokeswoman for the department declined to comment on why the agency had been refused funding for benchmarking for those operating its programmes but said that Fas was working on implementing the recommendation.

She said, however, that Fas "must take cognisance of the requirement that benchmarking payments can only be made where the increases that are awarded are linked to an agreement on modernisation and change. Once this process has been completed a formal submission for approval of the benchmarking increases will be processed by Fas."