* New bonus body aims to resolve disputes within 3 months
* Lawyer warns of big hurdle in coming up with hard evidence
By Huw Jones
LONDON, May 1 (Reuters) - Bankers who see rivals breaking bonus rules will get the chance to demand redress through an international supervisory body, if they can come up with hard evidence.
Bank bonuses have sparked public outrage in the United States and Europe as people face a squeeze on their income and share prices of lenders are stuck in the doldrums.
Leaders of the world's top 20 economies (G20) agreed limits on bank pay in 2009 and its regulatory task force, the Financial Stability Board (FSB), monitors how the rules are applied.
"Compensation practices at large financial institutions were a key contributing factor to the global financial crisis," the FSB said in a statement late on Monday.
The FSB said it has set up a Bilateral Complaint Handling Process (BCHP) for bankers to complain to their supervisor about rivals not applying the G20 rules.
"A difference in the level of pay should not in itself be deemed to be evidence of an uneven playing field," the FSB said, saying banks with a grievance must come up with "detailed evidence" of inconsistent implementation of the rules.
EVIDENCE HARD TO OBTAIN
The G20 rules limit how much of a bonus can be paid upfront in cash, and the balance must be in the form of shares that can only be cashed in over several years with a clawback mechanism if rewarded performance turns out to be illusory.
Banking industry officials were nervous about commenting in public about the FSB initiative, not wanting to be seen defending bankers who feel they are missing out on a bigger pay packets at such a sensitive time.
More than a quarter of shareholders at Credit Suisse and UK bank Barclays voted down the bank's pay plans last week.
In practice , Paul Fontes, head of employment at Eversheds lawfirm in London, says the evidence is often hard to come by. He recently advised a client hiring a team from a competitor bank.
The offer met the G20 rules restricting guaranteed bonuses to only one-year ahead.
"The client lost the team to a rival who offered guaranteed bonuses over three years. We contacted the regulator which said they would only be prepared to take action if we could produce firm evidence, such as a letter making the offer. In practice, that was impossible for our client to obtain," Fontes said.
"The challenge is getting the hard evidence and persuading the regulator to take prompt action to prevent the offer being made. Even if the regulator is prepared to take action in the future, that is probably going to be too late to hire the staff you want or retain your existing staff," Fontes said.
The FSB said if there is enough evidence of unfair competition, a bank's supervisor would take up the issue with the supervisor of the rival bank suspected of bending the rules.
The BCHP will allow supervisors to share confidential data on pay packets with the aim of resolving a complaint within three months. (Reporting by Huw Jones; Editing by Elaine Hardcastle)