Permanent TSB is to give its staff €1,000 each in recognition of the current cost of living pressures they face.

The bank said the payment will be in the form of a One4All gift voucher, with staff being encouraged to use the voucher to support local businesses and suppliers within their community where possible.

The Government extended the Small Benefit Exemption in the Budget, doubling to €1,000 the amount that employers can give workers by way of tax-free vouchers a year.

The gift exemption is a popular way for businesses to incentivise and reward staff.

Earlier this month, Bank of Ireland and AIB said they will also pay staff an additional financial support payment to help them to deal with the rising cost of living.

Brian McGuire, Head of People Operations and Reward at Permanent TSB, said, the bank recognised that staff and their families have had to cope with significant increases in food, energy and fuel prices in recent months and it wants to help alleviate that pressure.

"We have been engaging extensively with Employee Representative Bodies in relation to this initiative and want to acknowledge their support in putting it in place," Mr McGuire said.

The bank said the payment will be made to staff from Level 2 to Level 5 inclusive.

It follows a number of initiatives to support staff in recent months, including a 6.5% 2-year pay deal for 2022 and 2023 inclusive, and increased entry-level salaries.

Gareth Murphy Head of Industrial Relation and Campaigns with the Financial Services Union said the union had secured payment of the €1,000 from Danske Bank, Bank of Ireland, AIB and Permanent TSB. "This is good news for staff and the banking sector," he said.

John O'Connell, General Secretary of the FSU commented the payment should not be seen as a replacement for annual pay rises. "The FSU is very cognisant that our members are really struggling, like everyone else with the rise in costs of heating, food, and other essential items. We will continue to work through issues with all the Banks to ensure that our members interests are supported and protected."