AIB is facing claims for millions in pay increases and bonus payments from staff at the loss-making bank. The Irish Bank Officials Association (IBOA) is preparing to make legal claims on behalf of its AIB members in the Republic of Ireland, Northern Ireland and Britain to recoup the money that the union claims are due to employees.

The union is understood to be gathering information from members in an attempt to quantify losses they have incurred due to the non-payment of increments and bonuses before lodging the claims.

Salaries were frozen and bonuses eliminated at AIB as part of its rescue deal with the government in 2009, when the state put €3.5bn into the bank to stabilise its capital base. Some deferred bonuses were paid last year at AIB and other banks after legal advice said pay agreements predating the bail-out could not be voided.

AIB said it is in frequent contact with the IBOA, but would not comment on the coming claims.

The IBOA failed to respond to requests for comment.

The move comes as AIB prepares plans for up to 1,000 redundancies in its Republic of Ireland operations, the largest staff cuts in the guaranteed bank since the financial crisis began.

It is understood human resources managers at the bank are working out the details of the job cuts this month, ahead of AIB's interim results announcement on 11 August. The cuts are expected to start in September, informed sources said.

"While we have no doubt AIB is making contingency plans for various possible scenarios given the current uncertainties over these sales, the demands of the EU viability plan, and the prospects for a rights issue, the bank has yet to engage IBOA in talks on any job losses as it is obliged to do under the current Partnership Agreement between the parties and, indeed, under employment legislation," the IBOA said in a memo to members last week.

AIB is already committed to selling its British business under orders from the European Commission according to state aid rules.