Pacific Power slashes workforce

Pacific Power — the Portland-based investor-owned electric company — laid off 84 workers in June, including 50 members of International Brotherhood of Electrical Workers (IBEW) and Utility Workers Union of America (UWUA).

The news hit union members hard, particularly since some had left other jobs, and relocated from other states with their families, for what they thought would be secure careers at a utility.

A journeyman lineman from Medford-based IBEW Local 659, who asked not to be named, said the layoff hit home when his young son asked why he wasn’t heading to work. “My little girl said, ‘No, daddy doesn’t have a job.’”

Thirty non-union workers at the company’s Lloyd Center Tower headquarters in Portland were the first to learn of the layoffs, at the beginning of June. Then company managers told Local 659 officers June 5 that 24 members would be laid off June 8: 18 journeyman linemen and six pre-apprentices. Four members of UWUA Local 197 in Coos Bay were also let go. Then June 11, 20 members of Portland-headquartered IBEW Local 125 were notified their positions were eliminated effective immediately, including service coordinators, apprentice and journeyman estimators, and a utility specialist.

All the workers were paid through June 25, with health insurance benefits paid through the end of June.

Pacific Power said the layoffs were necessary because of reduced revenue from declining electricity sales, minimal new hookups, and flat forecasts for future revenue. A company spokesperson even spun the layoffs as a customer-friendly act — saying it would reduce the utility’s need to ask for future rate increases.

But Local 659 business manager Ron Jones rejected that, pointing instead to a decision by company owners to reduce Pacific Power’s operating budget and increase profits.

Pacific Power — a regulated electric monopoly with 700,000 customers in Oregon, Washington and California — has a legally-specified rate of profit built in to the rates it charges users. The company is one of three divisions of PacifiCorp; the others are Rocky Mountain Power in Utah, Wyoming and Idaho; and PacifiCorp Energy, which mines coal and generates electricity which is sold to the other divisions and on the open market. PacifiCorp itself is a wholly-owned subsidiary of by Mid-American Energy Holdings Company of Iowa, which is controlled by the Berkshire Hathaway conglomerate, whose primary shareholder is the world’s third richest man, Warren Buffett. Profits flow up. Over the last five years, PacifiCorp terminated pension benefits for most of its 3,800 union employees, replacing them with 401(k) plans. Last year, PacifiCorp paid its owners $550 million in dividends. Another $50 million in dividends went out in February 2012.

“We’re the ones that do the work that generates the money,” said another laid-off lineman. “Why are we the ones let go?”

Because linemen are the workers who restore customer power during outages, Jones said the layoffs could slow response to power-outs during winter storms. The layoffs also suggest Pacific Power is failing to plan ahead to replace an aging workforce. Under the collective bargaining agreement, layoffs start with the least senior workers, and all the laid off Local 659 members had been hired since April 2011.

Local 125 also criticized the layoffs, in a press statement. Pacific Power continues to contract out some work, the union said, failed to eliminate any front-line management positions, and gave the unions no opportunity to negotiate over the layoffs.

Given such an opportunity, the unions might have suggested less disruptive measures, such as incentives for older workers to retire early.

Local 659 has filed a grievance protesting the layoffs, saying that the company violated its obligation under the union contract not to lay off its own workers while outside contractors remain employed. Under the contract, the grievance could end up in binding arbitration, but Jones said it could take eight months to a year to get to that stage.

“Linemen, union workers, we’re pretty tight,” said a laid-off worker who had moved to take a job at Pacific Power. “We kind of hold a grudge when it comes to stuff like this.”

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