The Commonwealth Bank has had an appeal dismissed in the Federal Court and must now pay even more damages to a former executive.

The case stems from former executive manager Stephen Barker, who was made redundant in 2009 after more than twenty years with the Commonwealth Bank.

The Adelaide-based executive lodged legal action against the redundancy, saying the bank was in breach of its own policies by failing to inform him of other options.

The Courts found in favour of Mr Barker, saying the Bank had breached an implied term of mutual trust and confidence in his contract. Mr Barker was initially awarded $317,500 in damages.

The Commonwealth Bank has just lost its appeal of the initial decision; it had tried to convince the Court to reassess the contractual terms. The rejection came with more damages to be paid to Mr. Barker, now topping $335,000.

Law-firm Pace Lawyers says the judgment could have far-reaching implications. They believe a precedent has been set for company policies to become binding and carry the full force of the law.