Coalition Lauds PUC's Rejection of Utilities' Attempt to Lay Off Frontline Workers; Decision a Victory for Reliable Energy Service Delivery to Consumers.

Business/News Editors

SAN FRANCISCO--(BUSINESS WIRE)--March 15, 2001

A coalition of utility workers lauded the Public Utilities Commission's (PUC) approval today of an order by an administrative law judge rejecting a move by California's two major utilities -- Pacific Gas & Electric (PG&E) and Southern California Edison (SCE) -- to lay off more than 3,000 workers.

"As California's leaders work to find solutions to the current crisis, delivering reliable energy to California homes and businesses has to be among our highest priorities," said Jack McNally, chair of the Coalition of California Utility Employees (CUE), representing 35,000 employees at California's investor-owned and municipal-owned utilities. "The utilities are in part in desperate financial trouble because of high prices charged by generators. Laying off employees won't solve that problem. Even if every employee were laid off, it would not save enough money to pay the generators.

"Today's PUC decision is not just a victory for utility workers. It's a victory for every company and every individual consumer who has the right to receive dependable electric service," said McNally.

Administrative law Judge John Wong, who issued the proposed order approved by the PUC, had concluded that the cuts would affect the reliability of electricity and reduce customer service to levels below what is "adequate, efficient, just and reasonable." He noted that hundreds of layoffs already have occurred, affecting response times to service outages and customer calls.

McNally, CUE's chair and the business manager of IBEW Local 1245, a union representing 13,500 PG&E employees, said the PUC did the right thing by approving the layoff ban. "The amount of money the utilities would save from the layoffs is just a drop in the bucket compared to the huge financial problems they're having. Getting rid of workers isn't a solution-in fact, it would create more problems."

A CUE leader representing thousands of Southern California Edison workers agreed, noting that had the layoffs gone forward, it would have led to an erosion of service unacceptable to consumers.

"People are mad enough now about their high bills," said Patrick Lavin of IBEW Local 47, which represents 4,000 SCE employees. "Can you imagine how they'd react if the utilities don't have enough people on the job to keep the lights on? Frankly, going ahead with these layoffs would have been a disaster for consumers."

In his finding, Judge Wong quoted passages from the utilities' own documents warning about the direct impacts of layoffs. The utilities admitted that they would have to cut back on customer response levels at call centers, make customers wait longer for new connections, cut back on overtime to respond to service outages, reduce infrastructure replacement work, and stop reading meters on a monthly basis and substitute "estimated reads" instead.

Wong said he was especially "concerned that some of the layoffs that have occurred, or that will occur shortly, are taking place during the winter."

Earlier this month, residents in the Santa Cruz Mountains were without power for two days after an unusual snowstorm. Already having cut back on workforce resources, including overtime, PG&E did not send employees out to respond to the problem because the utility said the outage was not an emergency.

Southern California Edison has laid off at least 600 of its 13,000 regular and contract employees and announced plans to lay off 1,450 more. PG&E has "pink slipped" at least 400 of its 19,000 employees and has proposed laying off 600 more.

Under the order, the utilities are required to restore all of the positions cut so far, prohibit future layoffs, and reinstate the use of overtime.