Merging Utah Power & Light Co. and PacifiCorp may have shareholders and ratepayers pleased with prospects of the $2 billion deal, but UP&L employees remain worried and wondering about their future in a new company.
The merger promises shareholders ownership in a stronger company and lower power bills for ratepayers. And although the company has committed to honor its contracts with union workers and has promised job opportunities because of the merger, rumors of job cuts have persisted among workers since the merger was announced 16 months ago."Employees are very unsettled, and there is a lot of unrest about the merger," said Blaine Newman, business manager for the International Brotherhood of Electrical Workers Local 57, which represents more than 3,000 UP&L employees.
Newman said the contract between IBEW and UP&L expires in January - when the merger is scheduled to take place - causing additional uncertainty among employees. He said employees at PacifiCorp's other electric subsidiary, Pacific Power & Light, are also represented by IBEW.
Rumors of layoffs also circulate among non-union middle management employees. The latest speculation is that UP&L will cut its top-heavy management ranks by 300 positions after the merger.
"We hear about it (rumored job cuts) every so often. But we are so in the dark we don't know what is related to the merger and what isn't," said one employee who asked not to be identified.
Lack of information from headquarters about the merger and its impact on jobs appears to be causing most of the concern among workers.
"Basically, most of the information I get is from rumors," Newman said. "I have had some meetings with management, but they say they are restricted in what they can tell me."
But UP&L spokesman Dave Mead said the company is doing all it can to get information out to employees. Mead said he believes much of the unrest stems from the utility's aggressive austerity program that has cut hundreds of jobs in the past three years. "They were the first layoffs in 50 years and so the employees' concerns are real. There is an uneasy feeling around.
"We acknowledge that it's been hard on the employees. It's been 16 months since the merger was announced and that is a long time to be held in suspense."
To allay fears, Mead said, UP&L uses newsletters, video tapes and a hotline to disseminate information on the progress of the merger and what it will mean to become a division of PacifiCorp, based in Portland, Ore.
Anonymous letters and phone calls from concerned UP&L employees have poured into the offices of the Utah Public Service Commission, Gov. Norm Bangerter and the state's congressional delegation, PSC chairman Ted Stewart said.
Both companies testified before the PSC that employees would be guaranteed a job after the merger. "That may mean relocation or retraining, but they will be provided a job," Mead said, noting that transition teams are now working on how to merge UP&L into the PacifiCorp operation.
To ensure that guaranty of employment, the PSC conditioned its merger approval on "no employee shall lose his or her job as a result of the merger," and labor reductions will be a result of attrition.
The PSC also requires the merged company to keep relocation and retraining at a minimum and that employees be treated fairly and reasonably if asked to relocate.
In another recent ruling on the merger, the commission said that in recent hearings UP&L and PP&L officials said they were "willing to abide by the spirit and intent of the conditions and expectations."
But, Newman said, although the company says there is nothing to worry about, nobody knows how it will interpret the PSC's conditions and expectations.
He said he has heard UP&L wants to "drastically change" their IBEW contract in 1990. But, Newman said he didn't know what those changes will be.
Negotiations for the new IBEW contract start in January.