The HSE has been told to pay senior nursing staff performance bonuses of up to €7,400 even though finance minister Brian Lenihan has urged the termination of all bonuses for public servants because of the perilous state of the public finances.

The controversial recommendation by a Rights Commissioner now threatens to upend Lenihan's policy to curb the €18bn public sector paybill.

The claim was taken under a little-used piece of legislation – the Payment of Wages Act – which prevents employers from docking wages without the employees' consent.

Though the claim was taken on behalf of just 23 directors of nursing – members of the nurses union, the INMO – on salaries of up to €84,900, it is understood that more cases are pending within the HSE.

As this is the first major successful claim taken under the act, similar claims from workers throughout the public and private sector cannot be ruled out.

"The HSE is considering the Rights Commissioner's recommendation and will decide over the next few weeks whether to appeal to the Labour Court," a HSE spokeswoman said last week.

Given the potential impact of the decision on the government's public sector pay policy, an appeal by the HSE is extremely likely.

High-profile figures in the HSE such as chief executive Brendan Drumm agreed to forgo bonus payments last year of up to €80,000 as did senior civil servants, agency chief executives as well as the Garda Commissioner and the Defence Forces chief of staff.

This followed a request from finance minister Brian Lenihan last May for all government departments and agencies to suspend all bonus payments until 2012 at the earliest in a bid to ease the pressure on the public finances.

The review body on pay for top public servants had also urged the suspension of bonus payments.

But the 23 directors of nursing involved argued that the bonus payments of between €6,800 and €7,400 each, or around 10% of basic pay, were agreed almost 10 years ago as part of their contract of employment. As such the bonuses could not be cut without their consent.

The Inmo added that the payments were for performance assessed in 2008 with payment due in 2009. But before payment was made, the HSE suspended all bonus payments without checking with the nurses.

The HSE argued that it was following stated government policy on pay and that it would be "inappropriate" for the HSE to depart from Lenihan's guidelines.

But the Rights Commissioner said that the performance bonuses were part of the legal definition of wages and were properly due to them.