The Paducah Sun
The Paducah Sun

Lawyer: fewer USEC job cuts
Severance packages will pay about $17,500 for the average plant worker.

By Joe Walker

USEC Inc. will cut 225 fewer uranium enrichment plant jobs this year than previously announced and the Department of Energy will offer about $17,500 in enhanced severance for the average worker, according to a Washington lawyer for the atomic workers' union.

Union policy analyst Richard Miller said DOE upper management briefed him Wednesday and will make the announcement today. On Monday, a department spokesman said news of enhanced severance would come by the end of the week, but details still were being ironed out.

USEC, which operates DOE-owned plants at Paducah and near Portsmouth, Ohio, will cut 550 jobs in July and another 75 by the end of the year, Miller said. Earlier, USEC said there would be 850 jobs eliminated roughly 425 at each plant to cut costs amid serious financial trouble.

"I don't have an allocation between the plants for the 625, but we know there will be 350 salaried and 275 bargaining unit people eliminated," Miller said. "That's about a quarter less than what USEC announced."

He said there still could be layoffs in 2001 to fill out the 850 quota. Miller said he had not been briefed by USEC, but understands the firm will entertain voluntary reductions from Friday until May 24.

USEC had said it would pay only normal severance and any additional help would have to come from DOE. In lieu of regular severance, the department will pay a lump sum of $12,500 for workers hired after July 1993 and $17,500 for those hired before then, Miller said.

"Clearly, for the most junior people, this is a much more generous arrangement," he said. "If you're more senior, it doesn't tend to favor you."

Miller said newer union workers would be better off to take $12,500 instead of the regular three to seven weeks' pay, depending on tenure. But those with 20 years or more service probably would come out ahead taking regular severance, he said.

Normal severance for union workers ranges from 3 to 26 weeks, and from 4.3 to 30.4 weeks for salaried employees, depending on length of service.

"The package is roughly 50 percent of what got offered last year," he said, referring to the completion of about 500 previous job cuts starting in 1998, almost half of which were at Paducah. The earlier package included double severance pay plus generous health insurance benefits.

DOE's new offer is to pay the full employer's share of company health insurance for one year after severance and 50 percent of the share in the second year, Miller said. The package offers more expensive transitional insurance called COBRA in the third year.

Miller said the offer falls well short of what displaced workers deserve, considering the burden placed on them by the federal government.

"Our concern is it seems that DOE and USEC cannot find a way to reach common ground to help people in these communities who were victims of the Russian deal or USEC's privatization," he said. "Either way, they're victims of administration initiatives through no fault of their own and yet they're given inequitable treatment compared with other DOE sites."

Under a government-endorsed nuclear disarmament plan, USEC is buying enough Russian uranium to equal the production of one of the plants at prices lower than plant production costs. Since it was privatized almost two years ago, USEC has plummeted financially and is considering closing a plant. Miller testified before Congress last month that he expects both plants to close within three years unless the government bails out the corporation.

Miller said the severance package is particularly hollow in light of the $3.6 million "golden parachute" that USEC President and Chief Executive Officer William "Nick" Timbers will receive if he is fired.