City banker's 'liars' outburst

Stephanie Villalba, 43, says the executives deliberately misled an industrial tribunal and "must be held to account".

She made the extraordinary claims as she attempted to recover £600,000 in legal costs.

Her tribunal last year was Britain's biggest sex discrimination case and one of the most bitterly fought of recent years. It was told she had been "bullied and belittled" and told to serve drinks to clients on a plane like a stewardess,

Ms Villalba, who was a senior banker at the US group's London office, said today her bosses conspired to pervert the course of justice.

She told a Croydon hearing that the executives had lied when they denied that a crucial meeting she relied on for her case had ever happened.

Three managers, Raymundo Yu, Ausaf Abbas and Sean Woodroffe, all insisted that Ms Villalba had never complained to human resources manager Pauline Cahill of discrimination and Ms Cahill backed them up.

Ms Villalba said all four had not told the truth. She said: "Firms, however large and profitable, must be held to account for their senior executives lying on oath. Women should not be discouraged from bringing valid claims for fear of crippling costs made more so by the deliberate obstruction of their employer.

"This would make a mockery of the protections afforded by this country's employment laws."

Ms Villalba had sued Merrill Lynch claiming she was forced out of the firm. During her evidence at the original 50-day tribunal she told how she was described as being "high maintenance" before being fired.

In December the tribunal rejected Ms Villalba's claims for sex discrimination and unequal pay but upheld her case for unfair dismissal.

She can now expect compensation estimated at about £50,000 for her sacking but is today locked in a battle with her former employers to try to recover up to £600,000 in costs arising from her case.

Acting for Ms Villalba, Dinah Rose told the tribunal that her client was entitled to a massive costs award because of the managers' lies and the behaviour of the firm's solicitors in the case.

She pointed to the tribunal's ruling issued in December,

which found the four managershad lied about the meeting-between Ms Villalba and Ms Cahill. The ruling stated: "Put brutally, why did they lie about the Cahill meeting if they had nothing to hide?"

Miss Rose also said costs should be awarded following

tribunal's ruling that the Merrill Lynch solicitors had "delayed and prevaricated" in providing documents. Ms Villalba had worked for the bank's private client business in Europe investing funds for some of Merrill's most important customers.

But in August 2003 her employers told her she had no future in the company and made her redundant. Merrill Lynch denied her claims and said she was relieved from her post because of extensive losses the firm was suffering in her department.

The hearing continues.