News of the pay-off came as Barclays Bank prepared to tell shareholders of a pounds 5m pay and compensation package for Bill Harrison, who quit as chief executive of Barclays' investment banking offshoot after just 13 months in the job.
Details of these record executive compensation packages are bound to re-ignite the confrontation between shareholders and board members over excessive pay. Barclays is expected to tell shareholders of the pounds 5m package for Mr Harrison in its annual report, due to be published on Wednesday.
Mr Fifield, who is known in the City as "Lucky Jim" for his sky-high rewards, was being groomed to take up the post of group chief executive of EMI, a new position set up with him in mind, after 10 years at the helm of the music division.
However, non-executives last month opposed his appointment after Mr Fifield allegedly demanded total control of the business and a compensation package worth pounds 10m a year. Mr Fifield's demands were rejected, and he has been expected to quit ever since.
Mr Fifield, who has worked for EMI since 1988, has collected more than pounds 34m in the last five years. An American with three children who travels constantly, he previously worked for CBS/Fox and General Mills, the food group.
Much of his compensation is performance-related. EMI's profits are now 10 times their level when he arrived. In the last decade EMI has acquired Virgin Records and signed lucrative acts such as Blur and the Spice Girls.
EMI is expected to justify the package by pointing to savings which the company will enjoy when it closes Mr Fifield's New York office, which costs more than pounds 10m a year to run.
Sir Colin Southgate, chairman of EMI, who is believed to have had a strained relationship with "Lucky Jim" recently, has now scrapped the plan for a group chief executive, according to sources close to the company.
Instead, the position will be split between Ken Berry, head of EMI's record label business, and Martin Bandier, head of music publishing. Sir Colin will remain as executive chairman. Previously he was to have taken a more back-seat role as non-executive chairman.
The Barclays annual report is expected to reveal that Bill Harrison received total pay for his brief spell at BZW of around pounds 5m. He joined in September 1996 with a mandate to build the Barclays subsidiary into a global business but resigned in October last year after Barclays reversed its strategy.
Barclays' annual report is expected to show that Mr Harrison was paid salary and benefits of more than pounds 1m in the nine months between January and October last year. In 1996, he earned pounds 2.85m in salary and bonuses. Part of his compensation package was designed to compensate him for bonuses forgone when he left Robert Fleming, where he was head of investment banking.
He is also known to have been given 133,000 share options which can be exercised at pounds 9.07p each. With the share price standing at over pounds 18, his options are likely to be worth more than pounds 1m. He is also understood to have earned a further pounds 150,000 from another executive reward scheme in 1996. In total this adds up to pounds 5m.
Nicknamed "Attila the Brum" for his belligerent approach and West Midlands background, he was hired at least partly because of a reputation for driving companies ahead and motivating employees.
However, staff at BZW became concerned when Mr Harrison set about firing bankers and bringing in new staff from rival investment banks.